SHORT TERM: pullback continues, DOW -66
Last night, after the close, FED chairman Bernanke’s speech was released: http://www.federalreserve.gov/newsevents/speech/bernanke20131119a.htm. Overnight the Asian markets lost 0.4%. Europe opened lower and lost 0.1%. US index futures were lower overnight as well. At 8:30 Retail sales were reported higher: +0.4% v -0.1%, and the CPI was reported lower: -0.1% v +0.2%. The market opened two points above yesterday’s SPX 1788 close and then rallied to 1796 by 10am. At 10am Business inventories were reported higher: +0.6% v +0.3%, but Existing home sales were reported lower: 5.12mn v 5.29mn. The market then started to pullback ahead the of the FOMC minutes. At 2pm: http://www.federalreserve.gov/newsevents/press/monetary/20131120a.htm. Just after the release the market hit SPX 1783. Then it bounced to 1788 before dropping to 1777 just past 3pm. A small rally into the close ended the day at SPX 1781.
For the day the SPX/DOW were -0.35%, and the NDX/NAZ were -0.30%. Bonds lost 13 ticks, Crude slipped 15 cents, Gold dropped $28 and the USD was higher. Medium term support remains at the 1779 and 1699 pivots, with resistance at the 1828 and 1841 pivots. Tomorrow: weekly Jobless claims and the PPI at 8:30, then Leading indicators and the Philly FED at 10am. There is also a speech from FED governor Powell at 9:45.
The market opened higher today, rallied back to yesterday’s SPX 1796 high, then declined for the rest of the day. Early we had thought Minor 4 had completed at SPX 1785. But that proved to be premature, as this pullback has become more complex than the previous Minor waves during Major wave 5. Thus far, even though this has been the largest pullback since the SPX 1746 low, it looks quite normal. There is no overlap of Minor 1 at SPX 1773, which would suggest a possible fifth wave failure at 1796. Even if there is an overlap, a potential subdivision of Minor 3 is also possible. Only a drop to SPX 1761 would confirm Intermediate wave v has ended.
Short term support remains at the 1779 pivot and SPX 1746, with resistance at SPX 1810 and the 1828 pivot. Short term momentum ended the day quite oversold. The short term OEW charts flip-flopped again today, ending negative, with the reversal level now SPX 1788. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market