SHORT TERM: choppy day, DOW -27
Overnight the Asian markets gained 0.4%. Europe opened lower and lost 0.2%. US index futures were lower overnight. At 9am Case-Shiller was reported higher: +13.4% v +13.7%, and the FAHA housing index was reported higher: +0.8% v +0.1%. The market opened two points above yesterday’s SPX 1848 close but immediately started to pullback. At 10am Consumer confidence was reported lower: 78.1 v 80.7, and FED governor Tarullo’s speech was released: http://www.federalreserve.gov/newsevents/speech/tarullo20140225a.htm/. The market had also pulled back to SPX 1840 by 10am, and then started to rally. At 11:30 the market cleared its previous ATH at SPX 1851, hitting 1853, but then started to pullback again. At 2pm: http://www.federalreserve.gov/newsevents/press/bcreg/20140225a.htm. This second pullback hit SPX 1842 around 3:30, then the market bounced into a 1845 close.
For the day the SPX/DOW were -0.15%, and the NDX/NAZ were -0.15%. Bonds gained 12 ticks, Crude slid 85 cents, Gold added $3, and the USD was lower. Medium term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1884 pivots. Tomorrow: New home sales at 10am.
The market opened slightly higher today, then resumed yesterday’s afternoon selling. The decline from the noon all time high at SPX 1859 yesterday declined to 1840 by 10am. This decline overlapped the previous rally: SPX 1836-1846. Then after a rally to SPX 1853 by 11:30 today, another pullback followed to SPX 1842. Our nice clean rally from SPX 1738 has now turned quite choppy, and the impulsive pattern is getting quite sloppy. The OEW 1841 pivot range has become a magnet again. The last time the market entered its range, late-December, the SPX vacillated around it for more than three weeks before heading into a correction. This time around, the market has already spent over a week vacillating it. May need a gap up opening to finally clear the pivot and regain upside momentum.
Short term support is at the 1841 and 1828 pivots, with resistance at SPX 1851 and now SPX 1859. Short term momentum hit oversold early today, then spent the rest of the day below neutral. The short term OEW charts turned negative, then positive, and the reversal level is now SPX 1843. Best to your trading this choppy market.
MEDIUM TERM: uptrend probable
LONG TERM: bull market