Stock Market Outlook for Thu Jun 24 2021 – Mixed Outlook But Still Bullish

Wednesday morning saw the SPX within a point of the all-time high before sellers sent the index lower. By late in the afternoon another rally was pushing the index to 4254 before selling picked up for the final half hour and the index slipped back to close down 4 points at 4241.

Let’s review Wednesday’s close to see what Thursday may bring for investors.

Stock Market Outlook Chart Comments At The Close on Wed Jun 23 2021 

Wednesday saw the S&P end the day above the 21 day moving average and again just below the Upper Bollinger Band. The closing candlestick is another doji which often signals another negative day on Thursday.

The Bollinger Bands Squeeze is still underway without any clear signal which way stocks will move out of the squeeze.

The 50, 100 and 200 day moving averages are climbing. These are bullish signals.

At the close on Wednesday there are two bearish signals to contend with for Thursday but the rest remain bullish.

Stock Market Outlook review of Wed Jun 23 2021

Stock Market Outlook: Technical Indicators Review:

Momentum: Momentum is unchanged and positive.

• Settings: For momentum I use a 10 period when studying market direction.

MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal Thursday June 17 2021. The down signal on Wednesday was slightly weaker again which is bullish for stocks.

• 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 unchanged.

• 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 an up signal in place.

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 falling.

• 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:

4250 is resistance

4225 is resistance

4200 is light support

4175 is light support and just below the 50 day moving average

4150 is light support

4100 is light support

4070 is very light support

4050 is light support and is where the 100 day moving average rests

4000 is good support

3900 is support

3850 is support

3800 is support and just below the 200 day moving average

3750 is good support

3700 is light support

3680 is light support

3600 is strong support

 Stock Market Outlook for Tomorrow – Thu Jun 24 2021 

For Thursday the technical signals are more mixed with a number of signals falling and others turned sideways. Only one signal is rising, the Slow Stochastic.

Expect a mixed day on Thursday but the overall bias is still bullish. Once again the technical indicators are advising investors should not expect a large move up or down on Thursday but the index is still close to making a new all-time high.

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