The Stock Market Outlook for Tuesday was for stocks to largely move sideways and either close slightly lower or slightly higher. Instead stocks rose on Tuesday and all 3 indexes moved higher.
The rally though was not broad-based and volumes were heavily biased to the downside, despite the markets advancing.
Stock Market Outlook Chart Comments At The Close on Tue Sep 11 2018
The S&P ended the day above the 21 day moving average although during the early morning it fell back to just below it and then advanced. The close was not at the high which leaves the market open to a continuation of the rally on Wednesday, however the outlook is not for a rally but for the markets to either close unchanged on Wednesday or slightly lower.
The closing candlestick on Tuesday was bullish.
All the major moving averages are still climbing which is bullish. The 21 day moving average is also rising.
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is negative and continuing to fall.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Thu Sep 6 2018. The down signal was still strong on Tuesday.
- 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 signal is positive and 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 in place but the pullback is slowing..
- 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 rising.
- 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 Levels To Be Aware Of:
2830 is light support
2795 is light support
2745 to 2750 is light support
2725 is light support.
2700 is support.
2675 is light support.
2650 is light support
2620 is light support
2600 is strong support.
There is good support at the 2550 level from where the market bounced back from the recent correction low on Feb 9.
The S&P has light support at 2480. It also has light support at 2450 and good support at 2425. Below that there is some support at 2400, 2380, 2350. 2300 has the most support at present but would represent a full correction as a drop to this level would be 20% and just 5% away from a potential bear market signal.
Stock Market Outlook for Tomorrow – Wed Sep 12 2018
For Wed Sep 12 2018 the S&P technical indicators are pointing to a sideways day and a chance for the index to end the day slightly lower.
There will be dips during the day but overall the technical indicators are not showing any signs of stress but instead are pointing to the S&P closing slightly lower on Friday.
Stock Market Outlook Archives
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