SHORT TERM: market pulls backs after two day rally, DOW -171
Overnight the world’s markets continued their rebound as most of the Asian markets were up sharply. Quite a volatile week in that region: Australia was down 10% by tuesday only to close the week up 1.5%, and Hong Kong was down 14% by tuesday to close the week off just 0.3%. Europe had a roller coaster ride as well, as England ended the day flat, and the week with a slight loss. The US markets started on a positive note as the index futures were traded higher overnight. A gap up opening pushed the SPX to 1369 in the opening minutes, the level (1364) from where the bull market broke down. The higher opening was immediately met with steady selling throughout the day. By 2:00 the SPX hit 1328 which held for an hour, then rallied to 1340, only to fall back going into the close. After a 100 point rally in two days, a one day 40 point pullback doesn’t seem too unreasonable. At the close the SPX/DOW lost 1.50%, and the NDX/NAZ were 1.75% lower. Bonds rallied over one point, Crude gained $1.30, Gold added $9.00, and the Euro was sharply lower. Support for the SPX is at 1327 and then 1316, with resistance at 1344 and then 1364. Short term momentum turned lower after getting overbought this morning. After possibly a little more downside pressure monday morning, expecting this rally to resume. Best to your weekend!
MEDIUM TERM: market bottomed at 1270
LONG TERM: bearish