SHORT TERM: market gaps down, DOW -124
Overnight the Asian markets declined 0.3%. European markets opened lower and closed -1.4%. US index futures were lower overnight, and at 8:30 the Payrolls report came in lower than expected: +80K vs +69K. The Unemployment rate remained at 8.2%. The market gapped down at the open to SPX 1359 and continued to decline. The SPX had closed at 1368 yesterday. Around noon the SPX had declined to 1349 and tried to rally. The rally ended up as a bounce to SPX 1353 by 1:30. Then the market headed back down. Around 2:30 the SPX hit 1348 and tried to rally again. Heading into the close the SPX hit 1356 and end the week at 1355.
For the day the SPX/DOW were -0.95%, and the NDX/NAZ were -1.30%. Bonds gained 11 ticks, Crude lost $3.05, Gold dropped $20, and the USD was higher. Support for the SPX drops to the 1313 and 1303 pivots, with resistance back again at the 1363 and 1372 pivots. Short term momentum was quite oversold at the lows, then bounced with the rally. Today the WLEI upticked for the first time in quite a while: 47.1% vs 46.4%.
The market resumed its pullback today after the monthly Payrolls report came in lower than expected. After a gap down opening the market declined steadily to SPX 1349, with only 2-3 point bounces along the way. An attempted rally around noon could only gather four points to the upside. Then the market headed back towards the lows.
The SPX had cleared the OEW 1363 support pivot minutes after the open, and headed toward the 1342/47 support zone. It found support just one point above at SPX 1348 around 2:30, and then rallied into the close. This 27 point pullback fits well with what was expected. Short term momentum got quite oversold during the decline, and the market held support. Once the SPX clears 1358 the uptrend should resume. Best to your weekend!
MEDIUM TERM: uptrend
LONG TERM: bull market
Tony
5 min SPX bear market had a corrective abc pattern that ended at the lod, when falling further would have been statistically significant on the flattening out 50 ma. Same as the old bear market ended. A new 5 minute bull market is underway.
thx
I’m not an EW expert by any means … as a matter of fact, I plan to enroll in OEW Tutoring this September with Tony.
That being said, if this is the kickoff to wave three of anything, it is the ugliest, lamest, choppiest wave three I have witnessed.
I think that if the Dow is the index to follow, then the alt count applied there is likely operative and what we have just witnessed was yet another B wave uptrend in this most difficult to track bull market.
The close last week saw sentiment become very bullish very quickly, to the point of becoming too bullish too quickly. As a result, the market stalled and churned at its highs before finally heading lower in earnest. The market would seem to be in Wave C down to finish major 2 …
Actually, believe it or not, this uptrend is tracking quite well.
Today was either a nice washout or the start of something bigger. I closed many of my shorts (puts for hedging and a few covered calls) and added to my longs cautiously.
IMO, it is important to see how Monday unfolds. Yesterday we got a clear reversal candle, and hedging has paid off well, but closing near the high of the day after the gap on a bullish reversal candle is a clear warning shot to all the bears. We need to recapture the 1363 quickly and maintain it to keep the bull case alive, or we could see a further drop to 1330ish first.
thanks TAC, agree
Thx Tony. Nice call on the supports. ES took it 10 points into lock up. Very efficient bots.
them Doozie Bots
Thanks R2D3!
+ uno H D!
u call this sun?
good for cooking outdoors without a flame