It was quite the day on Tuesday with investors dropping out of stocks at the open thanks to North Korea firing a missile over Japan. But by the close investors had jumped into the day’s weakness and pushed stocks back higher.
S&P Index Close
The S&P index ended up 2.06 to 2446.30.
Dow Jones Index Close
The Dow Jones ended up 56.97 to 21,865.37.
NASDAQ Index Close
The NASDAQ closed up 18.87 to 6301.89
Stock Market Outlook
Stock Market Outlook – review of Tue Aug 29 2017
Chart Comments At The Close:
The S&P on Tuesday bounced near the 100 day moving average but closed below the 50 day moving average. Overall the move on Tuesday Aug 28 was bullish but we have seen this type of action before.
The 231 day moving average is still falling but has not fallen below the 50 day moving average which is also bullish. The closing candlestick is bullish. The Upper Bollinger Band continues to slow fall lower but it is not overly bearish.
Overall the chart looks more like sideways than up or down.
Stock Market Outlook: Technical Indicators:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is negative and shows no signs of climbing higher at present.
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 sell signal on Aug 3. The sell signal lost more strength again on Tuesday and the MACD histogram is also rising. Both are signs the market’s may be gathering some strength.
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 negative but moving sideways more than up or down.
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 has a buy signal in place for Wednesday.
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 rising slightly.
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 still negative and but is now indicating that prices may rise.
Support Levels To Be Aware Of:
The market had developed light support at 2450 and good support at 2425. There is also light support at 2400, 2380, 2350 and 2300.
Normally we should see the market try to hold the 2425 at the start of the week.
Stock Market Outlook for Tomorrow – Wednesday Aug 30 2017
Technically there are a few signs that the market is starting to gather some strength. The new buy signal from the Slow Stochastic was nice to see and the continued weakening of the MACD sell signal. Overall though indicators are still overly negative.
But the rally on Tuesday did alert the chart somewhat.
For Wednesday the outlook is more sideways than up or down. Overall looking at the chart pattern and the technical indicators they indicate there is a better chance of the market being slightly higher on Wednesday than lower, but often this means a sideways day.
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