SHORT TERM: another volatile day, DOW -154
Overnight the SPX futures gapped down 12 points at the open as a result of the military activities in the Ukraine. Asian markets lost 1.4%. European markets opened lower and lost 2.5%. At 8:30 Personal income (+0.3% v 0.0%) and spending (+0.4% v +0.4%) were reported higher, and PCE prices were reported higher: +0.1% v +0.1%. The market gapped down at the open to SPX 1844, then bounced to 1850 by 10am. The SPX had closed at 1859 on Friday. At 10am ISM manufacturing was reported higher (53.2 v 51.3), Construction spending was reported higher (+0.1% v +0.1%), but monthly Auto sales were reported lower. The market then resumed its decline hitting SPX 1842 by 10:30. After a bounce to SPX 1847 by 11am, the market dropped to 1834 just past noon. Then it had its best rally of the day, rising to SPX 1949 just before 3pm. After another pullback, this time to SPX 1840 by 3:30, the market bounced into a 1846 close.
For the day the SPX/DOW were -0.85%, and the NDX/NAZ were -0.75%. Bonds gained 16 ticks, Crude rallied $1.95, Gold rose $29, and the USD was higher. Medium term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Tomorrow: FED governor Powell gives Senate testimony at 10am.
Futures gapped down at the open last night and continued lower until the cash market gapped down at the open. Then after a bounce the SPX dropped to 1834, right at the low end of the OEW 1841 pivot. During today’s decline the nested 1-2-1-2 scenario was eliminated leaving us with the irregular Minor 2 scenario posted on the DOW charts. Today we uncovered another potential short term count: 1827-1809-1848-1841-1868. We have posted this count on the DOW charts and updated the SPX charts to the irregular Minor 2. You will note, we counted all the choppy activity between SPX 1848 on Feb 19th and SPX 1841 on Feb 26th as a 4th wave triangle. Under both current scenarios the market should drop back to around 1825 (1828 pivot range). But under the triangle scenario today’s low would have been sufficiently oversold for the end to Minor wave 2. Last week’s choppy activity created just too many potential counts. Take your pick.
Short term support is at the 1841 and 1828 pivots, with resistance at SPX 1851 and SPX 1859. Short term momentum dropped to quite oversold during the decline, then bounced to around neutral. The short term OEW charts turned negative at the open, and ended that way with the reversal level now SPX 1850. Best to your trading the Ukrainian situation.
MEDIUM TERM: uptrend
LONG TERM: bull market