friday update

SHORT TERM: market continues to edge higher to end month, DOW +4
Overnight most of the Asian markets were higher. Europe opened higher and closed +1.35%. US index futures were relatively flat overnight, and today’s Congressional testimony by FED governor Duke was released last night: http://www.federalreserve.gov/newsevents/testimony/duke20100226a.htm. At 8:30 the first revision to Q4 GDP was reported higher: +5.9% v +5.7%. The market opened around SPX 1104 after closing at 1103 yesterday. At 9:45 the Chicago PMI was reported improving: 62.6% v 61.5%. By 10:00 the SPX pulled back to 1098, the low for the day. Also around 10:00 Consumer sentiment was reported unchanged: 73.6% v 73.7%, and Existing homes sales were reported at a lower annual rate: 5.05 mln v 5.44 mln. The market then started to rally and hit the OEW 1107 pivot at 10:30. The market eased back off the pivot until 1:00 when the SPX hit 1101. At 1:30 FED governor Tarullo’s speech was released on financial regulatory reform: http://www.federalreserve.gov/newsevents/speech/tarullo20100226a.htm. The SPX then tried to rally into the close. A retest of SPX 1107 occurred around 3:30 and it closed at 1104.
For the day the SPX/DOW were +0.10%, and the NDX/NAZ were +0.25%. Bonds gained 6 ticks, (they were up all week), Crude rose $1.50, Gold rallied $9.00, and the USD was lower. Support for the SPX remains at 1090 and then 1061, with resistance at 1107 and then 1133. Short term momentum stayed between neutral and slightly overbought all day. February ends the month with the SPX +2.9%, and the DOW +2.6%.
The continuation of yesterday’s rally from SPX 1086 completes the second week of consolidation between the 1090 and 1107 pivots. All the major indices are now close to confirming new uptrends. The leaders since Oct 08, China and Hong Kong, are also close to confirming a new uptrend. It appears OEW is suggesting there is more work to be done on the upside from the Mar 09 lows. The SPX still needs to break through the OEW 1107 pivot, while the 1090 pivot continues to hold support. It does appear, unless there is a meaningful sharp reversal next week, probabilites favor higher prices ahead. Best to your weekend! 
MEDIUM TERM: downtrend in jeopardy
LONG TERM: bear/bull inflection point

About tony caldaro

Investor
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25 Responses to friday update

  1. x says:

    Tony, Yes. even better. Learn more each time I think about the SC. The 37-38 rally should have been 2 years long, like 73-74 and the current time frame retracement rally. However, we retested the lows because WW II imposed its will. A retest is not required. The 1937-38 rally was cut short. We never came close to retesting the lows after the 73-74 rally. However, after the retracement rally there should be a consolidation period of 4-8 years as the commodity bull market continues (same as 42-50 and 76-82), perhaps, less depending upon global events. We could then expect a monster move of 5-10X off the lows, depending upon which index and who flourishes in the next bull market. Well that is how I see right it anyway. Thanks.

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  2. jason says:

    ryanmuch appreciated! i will have to take a look at the charts.

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  3. Amos says:

    $SPX Feb 24 Produced (Inside Day) With close near the upper high. Feb 25th Open Gap down, with lower new low then close at upper highs. Feb 26th Closed the Gap. Very narrow trading range day. Prices close at upper highs again. Next week trading will be 6th week or 29th trading day. Observe daily and weekly chart of 1987 crash set-up. 6th week.http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=spx&sid=0&o_symb=spx&freq=1&time=4

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  4. Impulsive says:

    another quake

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  5. Ryan says:

    Jason,Roger D explained the 28 days to me earlier this week and it has some merit. If you look at the Dow chart of 1987 the wave count is as follows:Wave 1= 2747-2494Wave 2 then played out as an irregular flat (2635, 2468, 2662)From the peak of wave 1 to wave 2 in 1987 it lasted 28 days and retraced just more than 62% of the gains (2747-2469). One could argue that we are in the same wave count now on the SPX and Monday will be the 28th day although thus far the high already occurred 5 trading sessions ago.Hope this answers your question.

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