SHORT TERM: gap up turnaround Tuesday, DOW +116
Overnight the Asian markets lost 1.3%. Europe opened lower but gained 0.2%. US index futures were higher overnight. At 8:30 Retail sales were reported higher: +0.2% v +0.7%, Export prices were reported higher: +0.3% v +0.1%, but Import prices were lower: -0.1% v 0.0%. The market gapped up at the open to SPX 1827, then began to pullback. At 10am Business inventories were reported higher: +0.4% v +0.7%. The pullback ended around 10am at SPX 1822, and the market started to rally. At 1:30 the FED released this: http://www.federalreserve.gov/newsevents/press/bcreg/20140114a.htm. The rally continued throughout the day with only 2-3 point pullbacks along the way. Then it closed at the high for the day: SPX 1839.
For the day the SPX/DOW were +0.90%, and the NDX/NAZ were +1.80%. Bonds lost 14 ticks, Crude rose 60 cents, Gold dropped $10, and the USD was higher. Medium term support rises back to the 1828 and 1779 pivots, with resistance at the 1841 and 1869 pivots. Tomorrow: the NY FED and PPI at 8:30, then the FED’s Beige book at 2pm. Also there is Senate testimony from FED director Gibson at 2pm.
The market gapped up at the open today, pulled back a bit, then resumed its rally. Heading into the close the SPX nearly gained all of yesterday’s loss. This morning we posted a tentative Minor 2 label at yesterday’s SPX 1816 low. Next, we would like to see the SPX rise above 1843 to confirm. However, the market is acting as expected off yesterday’s oversold low. So it does look like the market is now rising in a Minor wave 3.
Short term support is the 1828 pivot and SPX 1814, with resistance at the 1841 pivot and SPX 1849. Short term momentum hit slightly overbought and closed there. The short term OEW charts turned positive with the reversal level now SPX 1834. Best to your trading the Beige book!
MEDIUM TERM: uptrend
LONG TERM: bull market