SHORT TERM: consolidation continues, DOW +4
Overnight the Asian markets lost 0.2%. European markets opened lower and lost 0.3%. US index futures were relatively flat overnight. At 8:30 Q2 GDP was revised upward: +1.7% vs +1.5%. The market opened one point higher than yesterday’s SPX 1409 close. In the first few minutes it bounced to SPX 1412, and then started to pullback. At 10:00 Pending home sales were reported higher: +2.4% vs -1.4%. Around 11:00 the SPX reached 1407, was short term oversold, and started to rally. The rally continued until 2:00 when the SPX hit 1414 and the FED released the beige book: http://www.federalreserve.gov/monetarypolicy/beigebook/beigebook201208.htm. After that the market pulled back into a SPX 1410 close.
For the day the SPX/DOW were +0.05%, and the NDX/NAZ were +0.10%. Bonds slipped 3 ticks, Crude dropped $1.25, Gold slid $11 and the USD was higher. Medium term support for the SPX remains at the 1386 and 1372 pivots, with resistance at the 1440 and 1499 pivots. Tomorrow: weekly Jobless claims, Personal income/spending and PCE prices all at 8:30.
The market opened slightly higher again today, pulled back to within one point above yesterday’s SPX 1406 low, rallied to yesterday’s 1414 high, and then pulled back again into the close. The consolidation continues, despite the Q2 GDP report and the FED’s beige book. Over the past four trading days the SPX has closed at 1411, 1410, 1409 and now 1410. We may now need to wait until after Labor day to resume the uptrend.
Short term support remains at SPX 1402/03 and the 1386 pivot, with resistance at SPX 1413/15 and 1422/27. Short term momentum dipped to oversold today, bounced above neutral, then dipped down again. The short term OEW charts are now at neutral with the swing point still SPX 1410. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market