SHORT TERM: pullback continues, DOW -50
Overnight the Asian markets lost 1.2%. Europe opened lower and lost 0.6%. US index futures were also lower overnight, and the market opened two points below Friday’s SPX 1710 close. The market continued to pullback until just before 11:30 when the SPX hit 1697. Then from an extremely oversold condition the market tried to rally. By 2:00 the SPX had reached 1705. A pullback to SPX 1701 followed by 3:30, then the market bounced to end the day at 1702.
For the day the SPX/DOW were -0.40%, and the NDX/NAZ were -0.20%. Bonds gained 9 ticks, Crude lost $1.35, Gold slipped $4, and the USD was higher. Medium term support remains at the 1699 and 1680 pivots, with resistance at the 1779 pivot. Tomorrow: Case-Shiller and the FHFA housing index at 9:00, then Consumer confidence at 10:00.
The market opened slightly lower today. Then declined nearly completely back to the recent pre-FOMC low at SPX 1695. All of the no-tapering FED announcement rally has been completely retraced, and then some. Thus far the uptrend is unfolding as expected: Int. i SPX 1662, Int. ii SPX 1641, Int. iii SPX 1730, and Int. iv may have just bottomed at SPX 1697. As long as the OEW 1699 pivot range holds, we should get a rally to slightly higher highs to potentially end this uptrend over the next week or so.
Short term support at the 1699 and 1680 pivots, with resistance at SPX 1730 and the 1779 pivot. Short term momentum hit extremely oversold this AM, then started to rise. The short term OEW charts dipped negative then positive with the reversal level now SPX 1702. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market