SHORT TERM: market manages to post some reasonable gains ahead of the GDP/FED tomorrow.
The market gapped up at the open this morning, but quickly eased back to fill that gap by 10:00. As the day progressed, the cyclicals moved higher despite the lagging tech sector, which made a lower low for the day at 1:00. And neglected, the sharp rally in Crude, which rose to nearly $57, the area from which it broke down earlier in the month. Bonds were up a few ticks ahead of the FED, Gold was up $3.50, and the Euro also rose. The NYA (NY Composite index) made gradual progress throughout the day, indicative of the cyclical rally. Just as Apple traded flat to lower most of the day, indicative of the action in the tech sector. If you recall, over the weekend I suggested to observe both of these this week, for signs of the market’s direction. At the close the SPX/DOW gained 0.40%, and the NDX/NAZ rose 0.20%. Tomorrow the markets receive a virtual worldwind of economic data. The Q4 GDP and ADP employment report at 8:30, Chicago PMI and Construction spending at 10:00, then the FED’s statement at 2:15, only to be followed by Google’s earnings after the close. Thursday and friday more economic data. Should get quite wild right into the weekend. Technically, short term indicators are neutral to slightly overbought. The short term wave patterns in the techs are sloppy, but the cyclicals look fairly constructive. Expecting some wild volatile action, as usual, after the FED releases its statement tomorrow. This could carry over into thursday, before the market begins to settle. Expecting the uptrend to resume shortly.
MEDIUM TERM: bullish
LONG TERM: bullish.