wednesday update

SHORT TERM: market decline continues, DOW -97
Overnight the Asian markets were mostly lower. Europe opened higher, however, and closed +0.15%. US index futures were mixed overnight, and at 8:15 the ADP employment index displayed less net monthly jobs created: 13K v 55K. Just after 9:00 FED governor Duke’s speech on credit was released: http://www.federalreserve.gov/newsevents/speech/duke20100630a.htm. The market opened lower at SPX 1038 but immediately started to rally, it had closed at SPX 1041 yesterday. At 9:45 the Chicago PMI was reported slightly lower: 59.1% v 59.7%. The market continued higher until about 10:00 when the SPX hit 1047. A small pullback followed to 1042 by 11:00, and then the market rallied to a slightly higher high at SPX 1048 by noon. That was the high for the day. After that high the market headed south. During the last hour of trading the SPX broke through the OEW 1041 pivot and hit the 1032 pivot on its way to SPX 1029 – the low for the day. A small bounce followed and the market closed at SPX 1031. 
For the day the SPX/DOW were -1.00%, and the NDX/NAZ were -1.30%. Bonds were up 3 ticks, Crude dropped 70 cents, Gold was flat, and the USD was flat. Support for the SPX drops to 1018 and then 1007, with resistance at 1032 and then 1041. Short term momentum was extremely oversold, bounced to near neutral during the day, and finished oversold again. Tomorrow, weekly Jobless claims at 8:30. Then Construction spending, ISM manufacturing and Pending homes sales at 10:00. In the afternoon monthly Auto sales.
The decline from the Major wave B high at SPX 1131, a week ago monday, continues. The market has already lost 102 SPX points in just eight trading days. The speed and the depth of this decline is in line with the Intermediate wave declines during this correction. The OEW short term charts continue to display this decline as one wave. The ten minute chart suggests we are still in wave 3 of the decline, with wave 1 at SPX 1068 and wave 2 at SPX 1083. Should this decline continue to fit within the characteristics of the previous Intermediate wave declines. We would expect a test of the OEW 1007 pivot before we get any sizeable rally. Best to your trading!
MEDIUM TERM: downtrend low at SPX 1029
LONG TERM: bull market in correction

About tony caldaro

Investor
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48 Responses to wednesday update

  1. R says:

    s2: thanks!

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  2. tony says:

    Welcome Sid,If the 1007 pivot holds the SPX could rally about 80 points … back to our friendly swing pivot at 1090.

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  3. C says:

    Hey Wig, you are the intuitive guy here, right? 🙂 Now what?…maybe the market is starting to notice the muni time bomb? or IL debt ?Thanks S2, Tony, everyone!

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  4. S2 says:

    RB, I use hourly RSI5 and RSI14. Over a couple weeks or more (like 1131–>1011 has been), hourly RSI14 is more meaningful but both offer insights.

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  5. Wiggin says:

    Tony may have mentioned a possible significant bounce from the 1008 pivot. Thanks TONY!

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  6. Wiggin says:

    CB – dollar had an March 2009 type move .. hmm

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  7. C says:

    around 24 May, despite multiple +d on RSi, the market didn\’t start to rally significantly until Macd +d kicked in ,though (60min chart) ..instead itbounced toward the 34 MA first, sold off again, and then set up macd +D . 34 ma now is 1052.46

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  8. C says:

    Tony marked +d on RSI 60 min

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