SHORT TERM: another gap up opening, DOW +106
Overnight the Asian markets lost 0.3%. Europe opened lower but gained 0.7%. US index futures were higher overnight, and at 8:30 the Trade deficit was reported lower: -$34.3bn v -$40.6bn. The market gapped up at the open to SPX 1834 and continued to rally. The market had closed at SPX 1827 yesterday. Around 10:30 the SPX hit 1840 and then pulled back to 1834 by 2pm. The then market rallied back to SPX 1840 by 3:30, dipping late to close at 1838.
For the day the SPX/DOW were +0.60%, and the NDX/NAZ were +0.90%. Bonds gained 5 ticks, Crude added 40 cents, Gold retreated $7, and the USD was higher. Medium term support jumps back to the 1828 and 1779 pivots, with resistance at the 1841 and 1869 pivots. Tomorrow: ADP at 8:15, and the FOMC minutes at 2pm.
The market gapped up again today but this time it held. Once the rally passed SPX 1833 we upgraded the green label to Minute wave a. We can count three waves down from the SPX 1849 high: 1828-1838-1824. The total decline was 25 points, and the C wave had a 0.618 relationship to the A. The positive divergence that formed at the low helped propel the short term count into Minute wave b. Recently, b waves have rallied to within one or two points of the previous high before topping. Then the c wave has kicked in taking the market lower. Something to keep in mind.
Short term support is now at the 1828 pivot and SPX 1814, with resistance at the 1841 pivot and SPX 1849. Short term momentum hit slightly overbought today. The short term OEW charts turned positive early with the reversal level now SPX 1834. Best to your trading the FOMC minutes.
MEDIUM TERM: uptrend
LONG TERM: bull market