monday update

SHORT TERM: FED rally continues, DOW +187
Overnight the Asian markets open were mixed, and Europe was closed for the holiday. Nevertheless US index futures rallied overnight, then bounced around into the morning. Nearing the opening, when rumors surfaced that JPM would raise its bid for BSC to $10/share, the index futures again moved higher. At the open the market gapped up, rallying right into the 1342 level by 10:00. Just at the time, the NAR reported that existing home sales for February rose 2.9%, beating expectations. The SPX continued the rally on the news, breaking through the 1344 pivot, and rallying close to the next EW pivot at 1364 by 1:00. After hitting SPX 1360 the market then eased back into the close. At the close the SPX/DOW were +1.50%, and the NDX/NAZ were +3.30%. Bonds lost nearly two points, Crude dropped $1.85, Gold was $3.00 lower, and the Euro was lower as well. Support for the SPX now notches up to 1344 and 1327, with resistance at 1364 and 1383. Short term momentum was overbought at the highs, with a slight negative RSI divergence, and backed off a bit into the close. The techs were strong today, the TRANsports confirmed a new uptrend, and with the break through SPX 1342 the major indices will likely do so as well. Tomorrow Case-Shiller home prices at 9:00, and the OFHEO home prices at 10:00, with a consumer confidence reading. Near term indicators today, reached the most overbought they have been since the bear market began. The downtrend was likely aborted, without reaching its target, again by FED intervention near the SPX 1270 level, as noted in the weekend report. Best to your trading!
MEDIUM TERM: downtrend likely aborted
LONG TERM: bear market

About tony caldaro

Investor
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16 Responses to monday update

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  3. tony says:

    Hi Booker … it certainly can.
    Made some notes of the expected potential for this rally in tonight update.
     
    Hi McKennedy … just like they unloaded their IPO on the public and an SWF.
     
    Hi Praveen … certainly it can.
    But I think you will find in the next week or two, the bulls outnumber the bears.
     
    Hi Joe … funny you should ask.
    I posted that pivot level (1383) this evening, along with the 1410 pivot.
     
    Hi McKennedy … I have AAPL in an uptrend. First one since the December top.
    And it appears to be trying to close that January gap down.

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  4. MCKennedy says:

    Sorry, 50 week MA

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  5. MCKennedy says:

    AAPL\’s up against its 20wMA at $142.87.  Needs to break that for market to continue this afternoon\’s advance.

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  6. Prakash says:

    Hi Tony,One problem with the indices reaching 1400+ in S&P, 13000 in DOW is that a pattern of higher highs will be extremely clear and would definitely create more confidence in people\’s minds. On the other hand, topping out 1382/84 in S&P, 12750 in DOW, QQQQ at 46 seems to keep bearish case intact. From 1270 bottom on jan 23, S&P rallied 126 points. adding 126 points to 1256 bottom in mid march also gives 1382. Volume has been extremely poor for all this bottom calling, COT showing commercials are getting out as fast as they can for 3 consecutive weeks support the cause. Is top around 1383 a possible scenario ? Joe

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