SHORT TERM: rally fades on weak economic reports, DOW -89
Overnight the Asian markets were mixed. Europe opened higher and closed +2.10%. US index futures were higher overnight. At 8:30 the weekly Unemployment claims hit 667K v 631K, and Durable goods orders dropped -5.2% v -4.6%. Nevertheless the market rallied at the open hitting SPX 776 within the first few minutes. A pullback followed to 769 by 10:00 when New homes sales were reported at a record low 309K v 344K. The market strangely rallied on the news hitting SPX 779 by 11:00. That would end up being the high as the market headed lower for the rest of the day. Just past 3:00 the SPX hit 752 and then bounced around into the close. For the day the SPX/DOW were -1.45%, and the NDX/NAZ were -2.65%. Bonds were flat, Crude rallied $1.75, Gold lost $19.00, and the Euro was higher. Support for the SPX drops back down to 734 and then 717, with resistance at 768 and then 789. Tomorrow, the first revision to Q4 GDP at 8:30, then the Chicago PMI and a Consumer sentiment reading around 10:00. For now, we’re going to mark todays high as the end of Minor wave 4, and expect Minor wave 5 to unfold next. Still expecting fibonacci support between SPX 680 to 725, pivots 696 and 717. Best to your trading!
MEDIUM TERM: downtrend
LONG TERM: bear market