SHORT TERM: stocks open slightly higher in choppy session
Overnight the Asian markets were all higher, as China’s SEC posted another bull market high. Europe was marginally higher. At 8:30 several economic numbers were released; the Core PCE rose to an annualized 2.4%, Consumer spending increased 0.4%, Wages rose 0.6%, and Unemployment claims rose to the highest levels in over a year. Stock index futures were higher before the reports, and pulled back on the news. At the open stocks managed to open higher, pulled back for 15 minutes and then turned higher again, in a choppy session. In the first 5 minutes the NYA posted a marginal new all time high. This uptrend just won’t quit! Bonds are again rallying (+1/2 point), need to take another look at that market. Crude appears to have bottomed, and I am now started to label the waves to the upside for the first time in four months. Gold is rallying as well, up over $10 so far today, as it enters a third wave. At 10:00 the Chicago PMI was released, and it displayed a marginally negative reading (49.9%) for the first time in three years. Anything below 50% is a contraction in this manufacturing index. Stocks responded by heading lower again. Thus far, we’re down about 0.50% across the board.
Technically, the negative RSI divergences on the 15min/60min charts came into play this morning. The failure of the NDX/NAZ to post late afternoon highs yesterday also factored in to this mornings pullback. I continue to view all the recent activity, from last wednesdays highs, as corrective. Gold looks good, and Crude appears ready to apply inflationary pressure again. Best to your trading!
MEDIUM TERM: neutral … major indices appear to have completed their uptrends
LONG TERM: bullish.