SHORT TERM: nice rally today afterall
Stock indices gapped up at the open, then pulled back to close the gap by around 10:30AM, after that the market added to its gains most of the day and into the close. The NDX twelve day lower low streak was broken, a good sign. The DOW managed to take out tuesday’s highs by a marginal amount, and the other three major indices rallied right to that point and closed there. The five waves down into the lows in Europe’s DAX/CAC/MIB led that market to a 1.5% – 2% rally before we closed. This had to help our fives wave down indices, mentioned yesterday: SPX/DOW/R2K/TRAN as well. The EW pivot points have been aiding in determining the current short term path: NAZ 2109..2153..2177, NDX 1539..1571..1611 and SPX 1240..1254..1268 and DOW 11,039. Yesterday, as the indices were establihing their lows they vacillated around their midpoint pivots. Today these same pivots provided support, and the SPX/NAZ even managed to break through their higher level pivots, with the NAZ exceeding even another pivot at 2190. Even though the NDX fell short, it has still managed to rally 3% from it’s lows, the best it’s done since the decline began a few weeks ago. Let’s step them up a notch: NAZ 2153..2177..2190, SPX 1254..1268..1281 and retain the NDX 1539..1571..1611. All pivots are posted on the respective daily charts. Short term momentum is somewhat overbought, with the 60min charts about at neutral and the daily charts still oversold. Lets see if this oversold rally can continue overnight. TGIF!
INTERMEDIATE TERM : downtrend
LONG TERM: bullish