SHORT TERM: stocks gap down on overnight selling, but recover
Overnight the Asian markets were all lower, with China’s SSEC dropping 6.5% as the government continues to try to cool that market. Europe came in about 0.95% lower, and our stock index futures were under pressure all night. At the open stocks gapped down with the SPX hitting 1510 within the first few minutes. The market then took hold as the Techs started to rally, led by GOOG and AAPL, (which made a new high). At the lows of the day, thus far, short term momentum was still at neutral. It never did get oversold. Bonds are up several ticks, Crude is 30 cents higher, Gold is $.00 lower, and the Euro continues to go lower. At 2:00 the FOMC minutes will be released. Earlier this morning ADP reported a slightly lower than expected rise in employment in May. The government releases its employment report on friday. Marking yesterday’s high of SPX 1522 as the end of a B wave, wave A was posted at 1505. If this pullback is certainly going to turn into a correction this would be a good place to get going to the downside. Best to your trading!
MEDIUM TERM: neutral, targets hit
LONG TERM: bullish.