On Tuesday Oct 17 2017, the Dow Jones pushed to the 23,000 level and closed just below it. The Nasdaq was essentially flat and the S&P gained less than 2 points.
S&P 500 Index Close
The S&P index ended up 1.72 to 2559.36
Dow Jones Index Close
The Dow Jones ended up 40.48 to 22,997.44
NASDAQ Index Close
The NASDAQ closed down -0.35 to 6623.66
Stock Market Outlook
Stock Market Outlook review of Tue Oct 17 2017
Chart Comments At The Close:
On Tuesday the S&P continued moving in a sideways direction. By the close of the day the candlestick was bearish for Wednesday but with earnings underway it is doubtful the index will move lower.
All the major moving averages and the 21 day moving average are moving higher which is bullish. The Upper Bollinger Band is also moving higher, again bullish for the market.
Stock Market Outlook: Technical Indicators:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is positive but continuing to slip.
MACD Histogram: For MACD Histogram, I am using the Fast Points set at 13, Slow Points at 26 and Smoothing at 9. MACD (Moving Averages Convergence / Divergence) issued a buy signal on Aug 31. The buy signal is still eroding. One more sideways day and it could issue an unconfirmed sell signal.
Ultimate Oscillator: 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. The Ultimate Oscillator is positive, no longer overbought but back rising.
Slow Stochastic: 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. The Slow Stochastic is extremely overbought. It is wavering between up and down signals. For Tuesday it is was signaling down. For Wednesday it is signal up. Overall though the signal is sideways.
Relative Strength Index: The relative strength index is set for a period of 5 which gives it 5 days of market movement to monitor. It often is the first indicator to show an overbought or oversold signal. The RSI signal is showing the market is still overbought and it is trending sideways but keeping a slight bias up. Prices should move higher.
Rate of Change: 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. The rate of change signal is positive but trending sideways which indicates prices are not expected to change much.
Support Levels To Be Aware Of:
The S&P has light support at 2480. It has light support at 2450 and good support at 2425. There is also light support at 2400, 2380, 2350 and 2300.
Stock Market Outlook for Tomorrow – Wed Oct 18 2017
You can see there is some weakness showing in the technical indicators but it is light. Instead what we are seeing is sideways action in an overbought market, while investors watch the latest earnings numbers come in from various companies.
Overall the earnings on Tuesday were good and beat estimates from those companies reporting, aside from Harley-Davidson Stock (HOG) which finished higher, but whose earnings were downright awful.
Wednesday there is still a sideways outlook in focus with a slight bias up, however we could just as easily see a slight negative close.
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