SHORT TERM: pullback should be over.
After a very strong opening, a negative divergence again appeared between the growth group NAZ/NDX (which was making new highs for this rally), and the cyclical group SPX/DOW (which failed to do so). When combined with the short term overbought condition, the market was then ripe for a pullback, which it did. This, by the way, is the third time that the SPX has hit 1310, and the third time the market pulled back as soon as it occurred. The next time should be different.
Looking at each of the four indices: the NAZ made a new high for the bull market and does not have ANY resistance EW pivots until it hits NAZ 2593. Naturally it will be subjected to the activities of the other indices that do. Short term momentum is at neutral. The NDX made a new high for this rally hitting EW pivot 1717 and then pulling back to test NDX 1700 a few times today. It’s next overhead EW pivot is 1735. Short term momentum here is also at neutral, which is a normal pullback area during uptrends. The SPX again hit SPX 1310 and then pulled back to the EW 1300 pivot area. Overhead resistance is at EW pivot 1316, short term momentum here is also at neutral. The DOW has been acting a bit sloppy as it does on occasion. Still its EW support pivot 11140 has held every downturn thus far, overhead resistance remains EW pivot 11350. Short term momentum is displaying positive divergences in the RSI/MACD. Thus, expecting it to rally from here. Overall, the market continues to act constructively considering the downward pressure the Bond market has been placing on it, by making new lows every day for three days now. Looking for the rally to continue.
INTERMEDIATE TERM: uptrend
LONG TERM: bullish