SHORT TERM: market spikes in last hour as the month ends, DOW +97
Overnight the Asian markets were all higher. Europe opened higher and closed +0.45%. US index futures were higher overnight and at 8:30 the first revision of Q1 GDP was reported at -5.7% v -6.1%. The market opened slighly higher and reached resistance at SPX 912 in the first few minutes. While the SPX started to pullback to 904 by 10:00, the Chicago PMI was reported at 34.9% v 40.1% and Consumer sentiment was 68.7% v 67.9%. The market then rallied back to the resistance pivot by 10:30 and that ended the range for the day until the very last hour of trading. At 3:00, with the SPX near the lows for the day (904) the SPX spiked to 920. At the close the SPX/DOW were +1.25%, and the NDX/NAZ were +1.20%. Bonds gained over one point, Crude rose $1.35, Gold rallied $17.00, and the Euro was higher. Support for the SPX jumps to 912 and then 848, with resistance at 935 and then 961. Short term momentum was getting overbought at the close.
It’s been an interesting month in many markets. While the SPX/DOW rose 4.5%, Bonds were -2.8%, Crude +27%, Gold +8% (Silver +23%), and the USD -5%. Equities remain in an uptrend but have been looking vulnerable. Bonds and the USD remain in downtrends, while Crude and Gold remain in uptrends. For all but the first day of the month the SPX has remained range bound: 879 – 930. Typically, this type of activity after an uptrend, usually leads to selling in the first week of the new month. Enjoy the weekend!
MEDIUM TERM: uptrend, but cautious
LONG TERM: bear market