SHORT TERM: rally continues, DOW +111
Overnight the Asian markets gained 1.3%. Europe opened higher and gained 0.5%. US index futures were relatively flat overnight, and the market opened lower at SPX 1689. The SPX had closed at 1693 yesterday. After a few minutes the market started to rally. By 10:00 the SPX had hit 1697, and Consumer sentiment was reported lower: 75.2 v 77.5. A pullback to SPX 1691 followed by 11:00, then the market headed higher again. By 1:00 the SPX hit 1703. Then after a pullback to SPX 1699 in the closing minutes the market rallied to end the week at 1703.
For the day the SPX/DOW were +0.70%, and the NDX/NAZ were +0.80%. Bonds gained 4 ticks, Crude slid $1.60, Gold dropped $16, and the USD was lower. Medium term support rises to the 1699 and 1680 pivots, with resistance at the 1779 pivot. Today the WLEI was reported lower: 53.8% v 54.7%.
The market opened lower today, but then quickly made a higher rally high and continued over SPX 1700. This represents a better than 61.8% retracement of the entire decline from SPX 1730-1646. As noted yesterday, this type of market action suggests an alternative count may be in play. We will cover this, and the primary count, in some detail in the weekend update.
Short term support is at the 1699 and 1680 pivots, with resistance at SPX 1730 and the 1779 pivot. Short term momentum hit extremely overbought today and end there. Best to your weekend!
MEDIUM TERM: downtrend counter-trend rally continues
LONG TERM: bull market