SHORT TERM: M & A helps the market move higher, DOW +124
Overnight the Asian markets were all lower. Europe opened higher and closed +2.25%. US index futures were higher overnight and the market opened higher on several merger and acquistion announcements. Within the first few minutes the SPX traded to 1048, and then continued higher hitting the OEW pivot at 1061 by 10:30. After a small pullback the market moved higher to SPX 1065 by 1:30. That was the high for the day. By 3:00 the market had pulled back to SPX 1061 and then started to edge higher into the close. For the day the SPX/DOW were +1.55%, and the NDX/NAZ were +1.85%. Bonds were up 9 ticks, Crude gained $1.00, Gold was flat, and the Euro was lower. Support for the SPX notches up to 1061 and then 1041, with resistance at 1090 and then 1107. Short term momentum continued to rise from friday’s extreme oversold level and is slightly overbought. Tomorrow, Case-Shiller will be reported at 9:00, and then Consumer confidence at 10:00.
Today the market spiked off the OEW 1041 pivot right up to the 1061 pivot. It then ran into a bit of resistance in this area after such a quick rise. This is quite normal. Minor wave 4 appears to have completed at the recent SPX 1041 low, avoiding the potential diagonal triangle scenario. It’s still possible for a retest of that level, which would be similar to the Minor wave 4 of the last uptrend, until the SPX trades above 1069. That would clear the pivot and signal that the uptrend was resuming. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bear market