Tuesday saw further selling which took the S&P down to the 21 day moving average. That brought in buyers who by the close turned the losing trade into a positive finish. The S&P ended the day up 7 points to 4690. The index is once more on the verge of attacking the 4700 level which continues to confounds the bulls.
The NASDAQ fell deeply during the day but recovered much of the loss and closed down 79 points to end the day at 15,775.
Let’s see what the closing technical indicators from Tuesday can tell us about Wednesday’s market, ahead of Thanksgiving holiday on Thursday and a half day of trading on Friday.
Stock Market Outlook Chart Comments At The Close on Tue Nov 23 2021
In the chart you can see the candlestick for Tuesday which fell to the 21 day moving average. From there a rally was sparked. On Wednesday we may see that same level touched again in choppy trading but the closing candlestick is advising that a bounce is expected.
The Lower Bollinger Band is still rising above the 50 day which is bearish. The Upper Bollinger Band is trending sideways which is bearish. A Bollinger Bands Squeeze is starting which could send the index higher or lower. At this point there is no clear signal up or down from the squeeze.
The 21, 50, 100 and 200 day moving averages are all climbing. This is bullish.
For Wednesday the chart is more bullish than bearish for Wednesday.
Stock Market Outlook review of Tue Nov 23 2021
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is rising and back positive.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Wed Nov 17 2021 . On Tuesday the down signal gained more strength.
- Settings: For MACD Histogram, I am using the Fast Points set at 13, Slow Points at 26 and Smoothing at 9.
Ultimate Oscillator: The Ultimate Oscillator is rising.
- Settings: The Ultimate Oscillator settings are: Period 1 is 5, Period 2 is 10, Period 3 is 15, Factor 1 is 4, Factor 2 is 2 and Factor 3 is 1. These are not the default settings but are the settings I use with the S&P 500 chart set for 1 to 3 months.
Slow Stochastic: The Slow Stochastic has a down signal for Wednesday.
Settings: For the Slow Stochastic I use the K period of 14 and D period of 3. The Slow Stochastic tries to predict the market direction further out than just one day.
Relative Strength Index: The RSI signal is rising.
- Settings: The relative strength index is set for a period of 5 which gives it 5 days of market movement to monitor. It is often the first indicator to show an overbought or oversold signal.
Rate of Change: The rate of change signal is falling.
- Settings: Rate Of Change is set for a 21 period. This indicator looks back 21 days and compares price action from the past to the present. With the Rate Of Change, prices are rising when signals are positive. Conversely, prices are falling when signals are negative. As an advance rises the Rate Of Change signal should also rise higher, otherwise the rally is suspect. A decline should see the Rate Of Change fall into negative signals. The more negative the signals the stronger the decline.
Support and Resistance Levels To Be Aware Of:
4700 is resistance
4655 is resistance
4600 is good support
4550 is light support
4525 is light support
4500 is support
4490 is support
4475 is support
4450 is support
4400 is support
4370 is light support
4350 is light support
4300 is light support
Stock Market Outlook for Tomorrow – Wed Nov 24 2021
For Wednesday the technical signals are more mixed but there are indications that the closing candlestick could be right, that a bounce could be in the works for Wednesday.
Historically the day before Thanksgiving has been positive almost 90% of the time and the Friday following has been positive and higher 95% of the time.
The day will see some weakness and there is even a chance the index might try to slip back to the 21 day moving average again, but a bounce looks likely with a higher close ahead of Thursday’s Thanksgiving holiday.
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