SHORT TERM: consolidation day in the SPX, DOW +46
Overnight the Asian markets were mixed. Europe opened lower and closed -0.10%. US index futures were lower overnight. At 8:30 the weekly Jobless claims were lower: 457K v 462K, the CPI was reported slightly higher: +0.1% v -0.1%, and the Current account deficit expanded: -$115.6 bln v -$108.0 bln. The market opened relatively unchanged at SPX 1165. By 10:00 the SPX hit 1168 when the Leading indicators were reported: +0.1% v +0.3% and the Philly FED was reported expanding: 18.9 v 17.6. After that the market started to pullback. Around 12:30 the SPX hit its low for the day at 1161. Then the market rebounded a bit to close at SPX 1166.
For the day the SPX/DOW were mixed, and the NDX/NAZ were +0.25%. Bonds were down 9 ticks, Crude lost 85 cents, Gold added $2.00, and the USD was higher. Support for the SPX remains at 1146 and then 1136, with resistance at 1168 and then 1176. Short term momentum headed lower early after yesterday’s overbought condition and then rebounded. Tomorrow is Options expiration day.
The market tried to rally today but stalled again at the OEW 1168 pivot. The DOW did manage to make marginal new highs, yet negative divergences are starting to build in that index. It appears we could be getting close to an Intermediate wave one top. Possibly another new high in the SPX along with another negative divergence might do it. The daily RSI, as noted yesterday, continues to be extremely overbought. We checked the wave structure in Sept 95, which is the last time this type of overbought level occurred. It was during Micro 3 of Minute iii of Minor 3 of Intermediate iii of Major 3 of Primary III of Cycle  from the 1974 Cycle  low. For this type of overbought condition to appear during this uptrend helps to confirm the Major wave 3 of Primary III scenario. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bullish