SHORT TERM: gap down opening, DOW -170
Overnight the Asian markets lost 1.5%. Europe opened lower and lost 1.7%. US index futures were lower overnight as well. At 9:00 Case-Shiller was reported higher: +12.1% vs +12.2%. The market gapped down at the open to SPX 1643 and continued lower. The SPX had closed at 1657 yesterday. In the first few minutes the SPX hit 1640, and then rebounded to 1646 by 10:00. At ten Consumer confidence was reported higher: 81.5 vs 80.3. The market then took out the SPX 1639 downtrend low, hitting 1638 by 11:00. Then after a bounce to SPX 1644 by 11:30 the market headed lower yet again. Around 2:30 the SPX hit 1631, bounced to 1636 by 3:00, then hit 1629 just before a 1630 close.
For the day the SPX/DOW were -1.35%, and the NDX/NAZ were -1.15%. Bonds gained 23 ticks, Crude rallied $2.90, Gold rose $14, and the USD was lower. Medium term support remains at the 1628 and 1614 pivots, with resistance at the 1680 and 1699 pivots. Tomorrow: Pending home sales at 10:00.
The market gapped down at the open today, following yesterday’s last hour decline. Within the first few minutes the SPX had already declined to within one point of the downtrend low. Quite a slide of 30 SPX points in less than 24 hours of trading. We were expecting the market to find support around SPX 1648-1649, then rally a bit higher to complete Intermediate wave B. The market obviously had other intentions.
Right after the open we marked yesterday’s high as a tentative Int. B with Int. C underway. The recent rally from SPX 1639-1670 fell a bit short of the 1680 pivot range: (1673-1687). It did get extremely overbought, but it did not quite reach the other technical parameters we were tracking. Nevertheless, the straight down decline is now the largest since the downtrend began at SPX 1710. Suggesting more downside ahead in the coming days.
Short term support is now at the 1628 and 1614 pivots, with resistance at SPX 1636-1640 and SPX 1648-1649. Short term momentum is extremely oversold. The short term OEW charts remain negative with the reversal level now SPX 1657. Best to your trading!
MEDIUM TERM: downtrend
LONG TERM: bull market