Weekend Stock Market Outlook

Stock Market Outlook For The Week of
September 22nd = Uptrend

INDICATORS

ADX Directional Indicators: Uptrend
Price & Volume Action: Uptrend
Objective Elliott Wave Analysis: Uptrend

COMMENTARY

The stock market outlook rolls into week 3 of the latest uptrend; the ADX, Price & Volume, and OEW remain bullish.

Investors shrugged off the attack on Saudi Arabian oil facilities, instead focusing on monetary decisions from the Fed and the ECB.

Technical analysis of daily SPX prices

2019-09-22 - SPX Trendline Analysis - Daily

For the second Thursday in a row, the S&P ($SPX) tried and failed to breach resistance near 3028.

The ADX line is below 20, which also highlights the weakness of our current trend. Weakness doesn't signal a trend change; we'll wait for the DMI's on that one. It does suggest the S&P sees “sideways” price action.

And it looks like an ascending triangle price pattern is in the works, so you could use those lines as support/resistance estimates.

The market gets a pass for Friday's high volume sell-off, thanks to options expiration. Trading volume tapered off as prices tested recent high prices, which isn't the greatest trading action.

Technical analysis of weekly SPX prices

2019-09-22 - SPX Trendline Analysis - Weekly

The Fed cut rates a quarter point, citing slowing global growth and U.S.-China trade war uncertainty. There was also some drama in the overnight lending market...call it a mini liquidity crisis. The Fed was able to address the issue. Did it impact your stock holdings? Probably not. But it didn't back when it happened in 2007 either. Instead, in both instances, these mini-crises indicate problems beneath the surface of the U.S. economy.

Whack-A-Mole
Image Courtesy of Valerie Hinojosa


 Like a game of whack-a-mole, it's easy to take care of one or two problems in the beginning of the game.

But as time passes, more and more surface...often at the same time...making it difficult to react.

In the financial world's version of whack-a-mole, the solution to one problem often makes two or three more pop-up.

All of this is outside of your control. What you can control is your risk of loss.

Position and portfolio sizing, capital preservation, and asset allocation are all aspects of your process that you can use to minimize that risk.

Best to your week!


If you find this research helpful, please tell a friend. If you don't find it helpful, tell an enemy. I share articles and other news of interest via Twitter; you can follow me @investsafely. The weekly market outlook is also posted on Facebook and Linkedin.

Charts provided courtesy of stockcharts.com.

If you're interested in learning more about the relationship between price and volume, or how to find and trade the best stocks for your growth strategy, check out this book on Amazon via the following affiliate link: How to Make Money in Stocks: A Winning System in Good Times and Bad. It's one of my favorites.

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.

Once a year, I review the market outlook signals as if they were a mechanical trading system, while pointing out issues and making adjustments. The goal is to give you to give you an example of how to analyze and continuously improve your own systems.

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