SHORT TERM: market recovers to close mixed, DOW +20
Stocks gapped down at the open this morning on overnight selling. By 10:00 the SPX hit support as it neared 1506, held, and then rallied. The rally was short lived as the SPX topped within the next hour at 1518. Then the rest of the day was spent going sideways in a narrow 1512 – 1517 range, until a small pop nearing the close. At the close the SPX/DOW were mixed, and the NDX/NAZ were 0.75% higher. Bonds were about 5 ticks lower, Crude lost $1.45, Gold lost about $1.00, and the Euro was higher.
High cap Tech stocks, especially those with strong growth, continue to lead this market. Stocks like AAPL/BIDU/CELG/GOOG/RIMM and VMW have been making new highs the last couple of days. Lower rates are good for growth, as the NDX made a new bull market high again today. The SPX, with its financial sector overweighting, has been lagging somewhat. Support remains at 1506 and then 1484, with resistance at 1530 and 1556. Short term momentum was oversold this morning, but is now beginning to rise. A durable goods orders report tomorrow, and that’s it. Should be a technical day. Best to your evening!
MEDIUM TERM: bullish
LONG TERM: bullish.