SHORT TERM: consolidation day, DOW -33
Overnight the Asian markets lost 0.3%. European markets opened lower, but closed +0.7%. US index futures were higher overnight, and the market opened at SPX 1413, touched 1414, and then pulled back. At 10:00 the FED issued the following: http://www.federalreserve.gov/newsevents/press/bcreg/20120827a.htm, and this: http://www.federalreserve.gov/newsevents/press/other/20120827a.htm. At 11:00 the SPX hit 1410 and then tried to rally. The rally carried the SPX to 1416 by 11:30 and another pullback followed. At 1:00 the FED issued this: http://www.federalreserve.gov/newsevents/press/bcreg/20120827b.htm. The pullback continued throughout the afternoon as the SPX hit 1409 just before, a 1410 close.
For the day the SPX/DOW were -0.15%, and the NDX/NAZ were +0.15%. Bonds gained 8 ticks, Crude slipped 55 cents, Gold slid $6, and the USD was higher. Medium term support for the SPX remains at the 1386 and 1372 pivots, with resistance at the 1440 and 1449 pivots. Tomorrow, Case-Shiller at 9:00, then Consumer confidence at 10:00.
The market opened slightly higher today, pulled back to SPX 1410, bounced to 1416, and then pulled back again. The action looked like a consolidation day after friday’s rally. From the friday low at SPX 1398 the market has rallied 18 points. This is the best rally since the recent SPX 1427 bull market high last week. And today’s rally stopped right at SPX 1416, last wednesday’s interim rally during the SPX 1427 – 1398 decline. Once the SPX clears 1416 the current rally should resume.
Short term support slips to SPX 1402/03 and the 1386 pivot, with resistance at 1413/15 and 1422/27. Short term momentum has started to decline after getting overbought. The short term OEW charts remain positive with the swing point now at SPX 1410. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market