SHORT TERM: decline continues, DOW -160
Overnight the Asian markets gained 0.5%. European markets opened lower and lost 0.8%. US index futures were vacillating around neutral all night, and the market opened one point below yesterday’s SPX 1676 close. Within the first few minutes the market dipped to SPX 1672, then bounced to 1677 by 10:00. After that the decline resumed. Around 2:30 the SPX hit 1657, then bounced to 1663 by 3:30. Heading into the close the SPX hit 1655 and ended the day there.
For the day the SPX/DOW were -1.15%, and the NDX/NAZ were -1.95%. Bonds lost 2 ticks, Crude added 50 cents, Gold slipped $3, and the USD was higher. Medium term support remains at the 1628 and 1614 pivots, with resistance at the 1680 and 1699 pivots. Tomorrow we may/may not get reports on Wholesale inventories at 10:00 and the FOMC minutes.
The market opened flat today and then headed south. After it dropped below SPX 1670 we upgraded the recent 1692 high to Int. wave B. Intermediate wave C appears clearly underway now. The decline did find support today, after a character change yesterday, in the SPX 1654-1665 range. Ending the day at its low SPX 1655. The DOW, which has been leading this decline, confirmed a new downtrend. We upgraded those charts to display a Primary III in place, at the September high, and Primary IV underway. Will do some calculations to estimate some support levels for this downtrend. Until then, Washington DC continues to hold the economy hostage.
Short term support is at SPX 1654-1665 and the 1628 pivot, with resistance at the 1680 and 1699 pivots. Short term momentum hit extremely oversold and we are due for a short term bounce soon. The short term OEW charts remain negative with the reversal level now SPX 1678. Best to your trading!
MEDIUM TERM: downtrend confirmed
LONG TERM: bull market