SHORT TERM: gap down opening, DOW -140
Overnight the Asian markets lost 0.7%. Europe opened lower and lost 1.0%. US index futures were also lower overnight, and the market gapped down to SPX 1873 at the open. The SPX had closed at 1879 yesterday. By 10am the SPX hit 1867, when Consumer sentiment was reported higher: 84.1 v 82.6. Then after a bounce to SPX 1872 the market hit 1862 by 11am. Another bounce pushed the SPX to 1869 by noon, but again the market pulled back to hit 1860 by 2:30. Still bouncing the SPX moved to 1866 by 3:30, then dipped to 1863 to end the week.
For the day the SPX/DOW were -0.85%, and the NDX/NAZ were -1.75%. Bonds gained 5 ticks, Crude dropped $1.30, Gold rallied $9, and the USD was flat. Medium term support drops to the 1841 and 1828 pivots, with resistance now at the 1869 and 1901 pivots. Last night the FED reported a decline in the M1-multiplier: 0.690 v 0.701, but an increase in the Monetary base: $4.012tn v 3.885tn. Today the WLEI was reported higher: 54.1% v 53.9%.
The market gapped down today for the first time in exactly two weeks. The last time the SPX hit the 1814 low, bounced around a bit, and then rallied non-stop to 1885. Today the SPX hit 1860, just below the 1869 pivot range, for a 25 point pullback or nearly 38.2%. The pullback has been choppy thus far: 1874-1884-1870-1883-1860. That two minute ramp to 1884 on Thursday’s open skews the pattern a bit, or else it would be a simpler: 1870-1883-1860.
Short term support is at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Short term momentum displays a positive divergence at today’s low. The short term OEW charts swung negative today and ended there, with the reversal level now SPX 1870. Best to your weekend!
MEDIUM TERM: uptrend probable
LONG TERM: bull market