SHORT TERM: market rebounds, DOW +41
Overnight the Asian markets were flat. Europe opened lower and lost 0.4%. US index futures were lower overnight, and at 8:30 the PPI was reported lower: -0.2% v +0.6%. The market opened three points above yesterday’s SPX 1930 close, but immediately pulled back to 1928 by 10am. At 10am Consumer sentiment was reported lower: 81.2 v 81.9. The market then rallied to SPX 1937 by 11am. Then after a pullback to SPX 1933 by 1:30, it rallied to 1937 again just past 3pm. A pullback to SPX 1931 followed nearing the close. But a late rally ended the week at SPX 1936.
For the day the SPX/DOW were +0.30%, and the NDX/NAZ were +0.30%. Bonds lost 8 ticks, Crude rose 25 cents, Gold added $3, and the USD was flat. Medium term support remains at the 1929 and 1901 pivots, with resistance at the 1956 and 1973 pivots. Last night the FED reported an increase in the Monetary base: $4.007tn v $3.933tn. Today the WLEI was reported lower: 54.5% v 54.8%.
The market opened higher today, producing the best rally since the decline began (1926-1933). Then it pulled back to SPX 1928, and again produced an even a better rally (1928-1937). This signaled to us that Minute iv may have completed at yesterday’s SPX 1926 low, and we posted a tentative green label. When the market rallies above 1937, we will feel fairly confident the low is in and Minute v is underway.
Short term support is at the 1929 pivot and SPX 1916-1919, with resistance at the 1956 and 1973 pivots. Short term momentum rose above neutral from yesterday’s extreme oversold level. The short term OEW charts turned positive late, and the reversal level is now SPX 1935. Best to your weekend!
MEDIUM TERM: uptrend
LONG TERM: bull market