Weekend Stock Market Outlook – May 02 2021

Stock Market Outlook entering the Week of May 2nd = Uptrend

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

The stock market outlook shows an uptrend in place to kick-off the month of May.

Technical analysis of daily SPX prices

2021-05-02-SPX Trendline Analysis-Daily

Another fairly flat week for the S&P500($SPX). We again start the week in basically the same position as the past 2 weeks: the index trading ~5% above the 50-day, roughly same distance to the lower trendline.

The ADX still shows a strong bullish trend in play. The index picked up another pair of distribution days last week, so the count is back at 5. Trading volume remains below average, so I’d guess it’s more a sign of profit taking than outright liquidation.

Technical analysis of daily SPX prices

2021-05-02-SPX Elliott Wave Analysis-Daily-Primary1

For Elliott Wave, I’m still not sure if the 4th wave ended. Price action remains weak; declining RSI, MACD, and a MACD crossover align with the flat price action we’ve seen lately. Hopefully you’re taking the opportunity to readjust your holdings.

So far, about half of the S&P has reported earnings, and by far the majority of those companies beat the estimates. That’s not too surprising, given how bad earnings were a year ago, but still a welcome sign. GDP is recovering, as is consumer spending (which accounts for ~70% of the U.S. economy). Stimulus checks may have helped…just a little. But even businesses were getting in on the act increasing their investment levels by 10% or so.

In other words, it appears the market’s are still in buy-the-dip territory if/when another correction comes our way.  Almost looking forward to it…almost.

Best to Your Week!

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