SHORT TERM: market rebounds after short term oversold condition, DOW +53
Overnight all the Asian markets were lower. Europe opened lower and closed -0.75%. US index futures were higher overnight and the market opened higher trading up to SPX 1191 in the first few minutes. By 10:00 the market pulled back to SPX 1185, then rallied again hitting 1193 nearing 11:30. A sharp pullback followed, in a short period of time, to yesterday’s low at SPX 1182. That was again the low for the day. After that the market started to rally into the FOMC statement. Just past 2:00 the FED released its statement: http://www.federalreserve.gov/newsevents/press/monetary/20100428a.htm. The market continued to rally hitting SPX 1195 by 2:30. Then it eased back on the day to close at SPX 1191.
For the day the SPX/DOW were +0.60%, and the NDX/NAZ were +0.05%. Bonds lost 17 ticks, Crude added 80 cents, Gold rallied $6.00, and the USD was higher. Support for the SPX rises back to 1187 and then 1176, with resistance at 1222 and then 1240. Short term momentum was extremely oversold at today’s low and moved to neutral during the day. Tomorrow, the weekly Jobless claims at 8:30.
After yesterday’s 2.3% decline the market responded well today. When it hit SPX 1182 yesterday it got quite oversold short term. Today’s early rally, and then the retest of that low with another rally was a positive sign. Daily momentum touched oversold during yesterday’s decline and edged higher today. A good sign medium term. With the SPX toggling the 1187 pivot today it continues to create support. The next test will come over the next fews days into the beginning of May. As long as the OEW 1176 pivot holds the uptrend can continue. Intermediate wave two can then conclude within the lower range (3.5% – 6.5%) of the significant pullbacks. Best to your trading!
MEDIUM TERM: uptrend in jeopardy
LONG TERM: bull market