SHORT TERM: new day, new highs DOW +47
Overnight the Asian markets were mostly lower again. That’s every day this week. Europe opened lower and closed +0.50%. US index futures were higher overnight. At 8:30 Personal income, (+0.5% vs +0.4), and spending (+0.6% vs +0.5%), were both reported higher. PCE prices were positive: +0.1% vs +0.2%, but the Q1 employment cost index rose +0.6% vs +0.4%. The market opened about unchanged at SPX 1360. Within the first few minutes the market rallied to SPX 1362 and then began to pullback heading into 10:00. During this time the Chicago PMI was reported lower: 67.6 vs 70.6, and Consumer sentiment was reported slightly higher: 69.8 vs 69.6. The pullback ended around 10:00 at SPX 1359 and the market started to work its way higher again. At 12:30 the FED released chairman Bernanke’s speech: http://www.federalreserve.gov/newsevents/speech/bernanke20110429a.htm. Around 2:30 the market hit a new high at SPX 1365, pulled back to 1361 by 3:30, and then ended the day at SPX 1364.
For the day the SPX/DOW were +0.30%, and the NDX/NAZ were mixed. Bonds gained 7 ticks, Crude rose $1.00, Gold rallied $28.00, and the USD was lower. Support for the SPX jumps to 1363 and then 1313, with resistance at 1372 and then 1386. Short term momentum continues to display a double negative divergence. Last night the FED reported the M1-multiplier was still declining, and the Monetary base is still making record highs. Today, the WLEI came in slightly lower at 55.5% vs 55.7%.
Despite the double negative divergence in short term momentum this market continues to work its way higher with very small pullbacks. Short term support is now at 1363, 1351 and then the 1313 pivot, with resistance at 1372 and then 1386. We’ll cover all the charts in the weekend update. Best to you and yours!
MEDIUM TERM: uptrend new high at SPX 1365
LONG TERM: bull market