SHORT TERM: gap up opening market ends mixed, DOW +66
Overnight the Asian markets were mostly lower, but gained 0.4%. European markets opened higher and gained 0.9%. US index futures were higher overnight. At 8:30 Personal income was reported lower: +0.2% vs +0.3%, but Personal spending was higher: +0.8% vs +0.2%. PCE prices came in lower: +0.1% vs +0.2%. The market gapped up at the open to SPX 1408, and continued to 1410 in the opening minutes. Around 10:00 the Chicago PMI was reported lower: 62.2 vs 64.0, but Consumer sentiment was reported higher: 76.1 vs 74.3. The market hit overbought right after the open and then pulled back to SPX 1401, closing the opening gap. After that it started to rally again. Around noon the FED released: http://www.federalreserve.gov/releases/g17/revisions/Current/DefaultRev.htm. The rally continued into the afternoon. At 3:00 the FED released the following: http://www.federalreserve.gov/newsevents/press/bcreg/20120330a.htm. The market also hit the high for the day, SPX 1411, around this time. A small pullback near the close hit SPX 1407, and the market ended the week at 1408.
For the day the SPX/DOW were +0.45%, and the NDX/NAZ were -0.20%. Bonds lost 15 ticks, Crude added 30 cents, Gold rose $8.00, and the USD was lower. Support for the SPX remains at the 1386 and 1372 pivots, with resistance at the 1440 and 1499 pivots. Short term momentum rallied to overbought after yesterday’s positive divergence. Last night the FED reported a decline in the Monetary base, but rises in the M1-multipier and New home prices. Today the WLEI reached an even 50%, after slipping to just below 40% in October. The economy continues to improve.
The market gapped up this morning, retreated to close the gap, and then rallied back to the high for the day. After 1:00 the market went sideways, in a 4 point range, while reaching SPX 1411. Overseas markets are weakening again. We currently have 7, of the 20 international indices we track, in confirmed downtrends. This is up from 4 just a few days ago. Four other indices are quite close to confirming downtrends as well. We will cover this new development, and other observations, in the weekend report. Best to you and yours!
MEDIUM TERM: uptrend high SPX 1419
LONG TERM: bull market