Stock Market Outlook for Thu Mar 24 2022 – Weakness, Choppy, Dips Likely

On Wednesday as Treasury yields rose and oil prices climbed, stocks came under pressure. Markets are very overbought so investors were looking for reasons to sell and on Wednesday they found more than one.

The S&P closed down 55 points, which wiped out Tuesday’s gain.

The NASDAQ lost 186 points, giving back 68% of Tuesday’s rally.

While the losses may seem large, they did not change the trajectory of the market at present. Let’s review the close on Wednesday to see what we should expect for Thursday on the markets.

Stock Market Outlook Chart Comments At The Close on Wed Mar 23 2022 

The index dropped back on Wednesday and closed at the 100 day moving average. The Upper Bollinger Band is still moving higher and the Lower Bollinger Band is still falling, indicating further upside is expected.

The closing candlestick on Wednesday is negative for Thursday.

The 21 day moving average is turning higher which is bullish.

The SPX still has 4 down signals in place.  The 200, 50 and 100 day moving averages are still falling lower.

The chart is more bullish again on Wednesday and indicates the index is still overbought which means more selling on Thursday is likely.

Stock Market Outlook review of Wed Mar 23 2022

Stock Market Outlook: Technical Indicators Review:

Momentum: Momentum is falling and positive.

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

MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal Wed Mar 16 2022. On Wednesday the MACD signal remained strong but did dip back. The MACD histogram still has a very strong reading.

• 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 falling and leaving overbought signals.

• 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 weak down 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 and leaving overbought readings.

• 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:

4500 is resistance

4490 is light resistance

4475 is light resistance

4450 is light support

4400 is support

4370 is light support

4350 is light support.

4300 is good support

4290 is light support

4270 is light support

4250 is good support

4225 is light support

4200 is good support

4150 is good support

4000 is good support

 Stock Market Outlook for Tomorrow – Thu Mar 24 2022 

The selling on Thursday was not a surprise. The rally has been huge but left markets very overbought. On Wednesday some of the overbought signals began to weaken. That leaves Thursday with a chance for a lower day, at least in the morning. There is still a chance the index will close positive. Dips on Thursday may end up being deeper than expected.

Stock Market Outlook Archives

Stock Market Outlook for Mon Nov 18 2024 – Choppy – Possible Bounce Attempt

Prior Trading Day Summary: For Friday semiconductor stocks were leading the markets lower. By the close the S&P was down 78 points to 5870. For the week the index lost ....... Read More

Morning Investing Strategy Notes for Fri Nov 15 2024

For FullyInformed Members the morning Investing Strategy Notes for Fri Nov 15 2024 review the outlook for stocks following a lower close on Thursday. There are a number of stocks ....... Read More

Stock Market Outlook for Fri Nov 15 2024 – Choppy With Bias Lower

Prior Trading Day Summary: For Thursday I had expected the index to dip a bit deeper than previous but to recover and close flat to higher. Instead the index slipped ....... Read More

Stock Market Outlook for Thu Nov 14 2024 – Choppy – Dips Possible But Higher Close

Prior Trading Day Summary: On Wednesday stocks tried to climb but found ready sellers who took advantage of each jump higher in individual stocks. By the end of the day ....... Read More

Morning Investing Strategy Notes for Thu Nov 14 2024

For FullyInformed Members the morning Investing Strategy Notes for Thu Nov 14 2024 review the outlook for stocks as weakness continues to dominate trading. There are a number of stocks ....... Read More

Morning Investing Strategy Notes for Wed Nov 13 2024

For FullyInformed Members the morning Investing Strategy Notes for Wed Nov 13 2024 review the outlook for stocks following a lower close on Tuesday. There are a number of stocks ....... Read More

Stock Market Outlook for Wed Nov 13 2024 – Choppy Trading Bias Lower

Prior Trading Day Summary: On Tuesday the week long rally finally ran into too many sellers and stocks slipped lower. The SPX fell 17 points and closed at 5984. Volume ....... Read More

Morning Investing Strategy Notes for Tue Nov 12 2024

For FullyInformed Members the morning Investing Strategy Notes for Tue Nov 12 2024 review the outlook for the rally as signs of it slowing are being reflected by the technical ....... Read More

Stock Market Outlook for Tue Nov 12 2024 – Overbought – Dips Likely But Bullish

Prior Trading Day Summary: On Monday investors continued the rally but while the closes were slightly higher, selling is taking place more often as some investors are scaling back on ....... Read More

Morning Investing Strategy Notes for Mon Nov 11 2024

For FullyInformed Members the morning Investing Strategy Notes for Mon Nov 11 2024 review the outlook for the start of the second week of November. There are a number of ....... Read More

Stock Market Outlook for Mon Nov 11 2024 – Overbought – Higher Still

Prior Trading Day Summary: On Friday investors continued the rally and pushed above 6000 before closing just below it at 6995 for a 22 point gain. For the week the ....... Read More

Morning Investing Strategy Notes for Fri Nov 8 2024

For FullyInformed Members the morning Investing Strategy Notes for Fri Nov 8 2024 review the outlook for the final trading day of what has been an incredible week for stocks.. ....... Read More

Stock Market Outlook for Fri Nov 8 2024 – Overbought – Dips Likely But Higher Close

Prior Trading Day Summary: On Thu Nov 7 2024 investors continued to pour capital into stocks as the Fed cut interest rates a quarter point as expected. The S&P rose ....... Read More

Morning Investing Strategy Notes for Thu Nov 7 2024

For FullyInformed Members the morning Investing Strategy Notes for Thu Nov 7 2024 review the outlook after Wednesday's massive post election rally. There are a large number of stocks discussed ....... Read More

Stock Market Outlook for Thu Nov 7 2024 – All About The Fed – Higher

Prior Trading Day Summary: On Wed Nov 6 2024 investors poured money into stocks that had been sitting on the sidelines waiting for a resolution to the Presidential election. The ....... Read More