SHORT TERM: market resumes rally, DOW +177
Overnight the Asian markets that were open were all lower, and Europe came in lower as well. US index futures were sold overnight, but gradually improved as the market prepared to open this morning. At the open the market bounced around for about a half hour, hitting a low of 1322 right after the Commerce Dept reported new home sales dropped 5% in December, and 26% for 2007. Then the market rallied on the news. By 11:30 the SPX hit 1343, 1349 by 2:30, and then hit 1354 nearing the close. For the day the SPX/DOW gained 1.6%, and the NDX/NAZ added 0.95%. Bonds closed a few ticks higher, Crude was up 30 cents, Gold continued its rally up $18.00, and the Euro was higher. Support for the SPX notches up to 1344 and then 1327, with resistance at 1364 and then 1383. Short term momentum barely reached oversold this morning, but closed slightly overbought in the afternoon. Expecting this rally to continue to the targeted 1410 – 1438 area. Tomorrow the FED starts its two-day FOMC meeting with the results to be announced at 2:15 on wednesday. Also tomorrow, Dec. durable goods order will be announced before the open, and a consumer confidence reading at 10:00. Best to your trading!
MEDIUM TERM: market bottomed at 1270, rallying
LONG TERM: bear market