SHORT TERM: consolidation monday, DOW -50
Overnight the Asian markets were relatively flat -0.1%. European markets opened lower but also finshed about flat. US index futures were lower overnight. At 8:30 Retail sales were reported lower: -0.5% vs -0.2%, but the NY FED was reported higher: 7.4 vs 2.3. The market opened lower at SPX 1354 and continued to decline. The SPX had closed at 1357 on friday. By 10:00 the SPX hit its low for the day at 1349. Also at ten Business inventories were reported: +0.3% vs +0.4%. The market then rallied near friday’s high, hitting SPX 1357 at 11:30, before pulling back to 1351 by 12:30. Another rally attempt followed, which also ended at SPX 1357 by 2:30. Then the market dipped into a SPX 1354 close.
For the day the SPX/DOW were -0.30%, and the NDX/NAZ were -0.35%. Bonds gained 7 ticks, Crude rose $1.25, Gold added $1, and the USD was lower. Support for the SPX remains at the 1313 and 1303 pivots, with resistance at the 1363 and 1372 pivots. The market has remained between these pivots for nearly six weeks now. Short term momentum declined from being quite overbought on friday to neutral today. Tomorrow, the CPI at 8:30, Industrial production at 9:15, and the NAHB housing index at 10:00. Also, FED chairman Bernanke testifies before the Senate at 10:00.
The market opened lower today, traded down to SPX 1349, rallied to 1357, and then stayed in that range for the rest of the day. It was a fairly quiet day despite the lackluster report in retail sales. The SOX index, which has been sliding since its early July high, is getting close to confirming a downtrend. When this occurs that index should be on its way into the two-year Tech cycle low scheduled for this summer. When it bottoms the upsurge in the cycle should give quite a lift to the general market.
Short term support remains at SPX 1342/47, 1334/38, and 1324/27. Overhead resistance is at the 1363 and 1372 pivots. Short term momentum ended the day above neutral. The short term OEW charts remain positive with the swing point at SPX 1348. Best to your trading!
MEDIUM TERM: choppy uptrend continues
LONG TERM: bull market