SHORT TERM: gap down opening reversed, DOW -33
Overnight the Asian markets gained 0.4%. European markets opened higher, but lost 0.8%. US index futures were lower overnight and the market gapped down at the open to SPX 1554. The SPX had closed at 1564 yesterday. In the first few minutes the SPX dropped to 1552, and then began to rally. At 10:00 Pending home sales were reported lower: -0.4% vs +4.5%. Also at the 10:00 the FED released this: http://www.federalreserve.gov/newsevents/press/other/20130327a.htm. The rebound continued until noon when the SPX hit 1561. A small pullback followed to 1558 by 1:00, then the market moved higher again. At 2:00 the FED released this: http://www.federalreserve.gov/newsevents/press/other/20130327b.htm. At 3:30 the market closed the gap hitting SPX 1564, then dipped to close at 1563.
For the day the SPX/DOW were -0.15%, and the NDX/NAZ were +0.10%. Bonds gained 14 ticks, Crude added 15 cents, Gold rose $7, and the USD was higher. Medium term support remains at the OEW 1552 and 1523 pivots, with resistance at the 1576 and 1614 pivots. Last night the FED reported New home sale prices rose: $313.7K vs $295.2K, nearing a record high. Tomorrow: Q4 GDP (est. +0.3%) and weekly Jobless claims at 8:30, then Chicago PMI at 9:45.
After three successive gap up openings the market gapped down at the open today. That makes it 7 gap openings in 8 days. Do not recall seeing this type of opening action since 2011. The pullback took the market right down to the 1552 pivot, and then the market reversed higher. Despite all these gap openings the market has remained in the SPX 1539-1565 range, after topping at 1564 before all this activity began. Today’s trading kept the SPX within that contracting triangle we noted yesterday. With QE 3 GDP tomorrow morning it could be a key day. If not we may need to wait until monday.
Short term support remains at the 1552 and 1523 pivots, with resistance at the 1576 and 1614 pivots. Short term momentum did not make it to oversold before rising. The short term OEW charts are still vacillating positive/negative with the reversal level now up to 1556. Best to your trading!
MEDIUM TERM: uptrend high SPX 1565
LONG TERM: bull market