Stock Market Outlook for Tue Dec 24 2024 – Weakness With Possible Dip But Still Bias Up

Prior Trading Day Summary:

Monday saw investors try to resume the bounce from Friday. The day started with a dip which was expected. The dip brought in buyers and the rally restarted. By the close the SPX had climbed 43 points. For the past two days the index has recovered 107 points or 60% of Wednesday’s plunge but also 89% of last week’s total loss of 120 points. Volume was light at 3.7 billion shares traded, which was expected ahead of Christmas Eve and Christmas Day. New highs were just 19 and new lows were 133 but 49% of all stocks were rising which is a good sign for later this week when the Santa Claus Rally is anticipated to start.

The NASDAQ rose 192 points. Over the past two trading days the NASDAQ has recovered 392 points which is 54% of Wednesday’s 716 point plunge. However it does recover all of last week’s 354 point total loss. Volume fell to a respectable 7 billion shares traded but just 46% of all stocks on the NASDAQ were rising. 51% were falling.

There is weakness present despite two days of a fairly strong rally and with a half day of trading on Tuesday, we could see a flat to slightly higher or lower close.

Whatever happens today shouldn’t impact stocks for after the Christmas holiday.

Let’s review the technical indicators at the close on Mon Dec 23 2024 to see what to expect Tue Dec 24 2024.

Stock Market Outlook: SPX Closing Chart For Mon Dec 23 2024

The index closed above the 50 day moving average and below the 21 day. This is  bearish but with a bullish bias.

The closing candlestick has a long shadow which signals a good chance for a dip on Tuesday and even a potential for a lower close.

The 21 day moving average is up slightly at 6019. This is bearish.

The 50 day moving average is higher at 5930. The higher move is just 3 points and signals the plunge has turned the outlook bearish.

The 100 day moving average is rising and closed at 5786. The higher move is just 3 points and signals the plunge has turned the outlook bearish.

The 200 day moving average is in an uptrend and closed at 5536 which is bullish.

The Lower Bollinger Band is below the 50 day and trending sideways which is bearish but also signals a move higher could be coming. The Upper Bollinger Band is turned sideways which is neutral.

The S&P chart is still more bearish than bullish for Tuesday with signals advising Tuesday could end lower.

SPX Stock Market Outlook review of Mon Dec 23 2024

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Tue Dec 24 2024 

A second bounce on Monday was a bit broader in scope than Friday’s bounce. Volumes though were a lot lower which often exaggerates the move intraday. This is some of the reason why the technical indicators are signaling some weakness to the rally is present and there is a chance for a dip on Tuesday.

For a half day the outlook still is bullish. Even a slightly lower close won’t change the overall higher trajectory for stocks once the Christmas holiday ends and trading resumes on Thursday and Friday. For Tuesday then, expected low volume with a potential dip but often low volume favors the bulls, especially after a strong two-day rally.

Potential Economic and Political Market Moving Events

Monday:

10:00 Consumer Confidence unexpectedly fell to 104.7 from 112.8 prior

8:30 Durable goods orders unexpectedly fell to -1.1% from 0.8% prior

10:00 New home sales missed estimates but still rose to 664,000, up from 627,000 prior

Tuesday:

No reports