friday update

SHORT TERM: gap up opening is faded, DOW +35

Overnight the Asian markets gained 0.1%. Europe opened higher and gained 1.2%. US index futures were higher overnight, then rallied after the Payrolls report was released. Payrolls gained: +114K vs +96K, and the Unemployment rate fell: 7.8% vs 8.1%. The market then gapped up at the opened to SPX 1467 and continued to rally. The SPX had closed at 1461 yesterday. By 10:30 the SPX hit its high for the day at 1471, then began to pullback. At 12:00 FED governor Duke’s speech was released:  http://www.federalreserve.gov/newsevents/speech/duke20121005a.htm. The pullback continued into the afternoon, closing the upside gap nearing 3:00. Around this time Consumer credit was reported higher: $18.1 bln vs -$3.3 bln. Heading into the close the SPX hit 1457, then ended the day at 1461.

For the day the SPX/DOW were mixed, and the NDX/NAZ were -0.50%. Bonds lost 16 ticks, Crude dropped $1.75, Gold slid $10, and the USD was higher. Medium term support remains at the 1440 and 1386 pivots, with resistance at the 1499 and 1523 pivots. Last night the FED reported a decline in the Monetary base: $2.589 tln vs $2.656 tln. Today the WLEI was reported higher yet again: 54.7% vs 53.8%.

The market continued yesterday’s rally early today, pushing the recent advance up to SPX 1471. Then it reverted back to the monday/tuesday action of rallying early and pulling back for the rest of the day. The rally from the SPX 1431 Intermediate wave iv low continues to display these starts and stops. But is still impulsing.

Short term support remains at the 1440 pivot and SPX 1422/27, with resistance still at SPX 1463/64 and the 1499 pivot. Short term momentum again hit quite overbought this morning, and then declined to nearly oversold during the pullback. The short term OEW charts remain positive with the swing level now around SPX 1453. Best to your weekend!

MEDIUM TERM: uptrend

LONG TERM: bull market

CHARTS: http://stockcharts.com/public/1269446/tenpp