SHORT TERM: gap down opening, DOW -44
Overnight the Asian markets finished mixed. Europe opened lower and lost 1.0%. US index futures were lower overnight, and the market gapped down to SPX 1980 at the open. The SPX had closed at 1985 on Thursday. After a brief dip to SPX 1978 the market rose to 1982 by 10:30, then headed lower. Around 2:30 the SPX hit 1975 for the third time and tried to rally. Heading into the last hour the SPX hit 1978 and closed there.
For the day the SPX/DOW were -0.30%, and the NDX/NAZ were -0.55%. Bonds gained 6 ticks, Crude slid 55 cents, Gold slipped $1, and the USD was higher. Medium term support remains at the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Tomorrow: Consumer credit at 3pm.
The market gapped down at the open for the first time since mid-June. It then continued to decline until it achieved the first significant pullback since SPX 1945. The 6 point pullbacks, noted in the weekend update, should now be considered just noise. Minor wave 5 rose from SPX 1945 to 1986. Since Minor 5 made new uptrend highs, today’s pullback could be considered the start of a new downtrend, or Minute wave ii of Minor 5. Should the market continue to lower, dropping below SPX 1962, or fail to make new highs during the next rally and drop below this pullback’s low then SPX 1986 probably ended the uptrend. Should the market rally to new highs soon, then the uptrend continues.
Short term support is at the 1973 and 1956 pivots, with resistance at SPX 1986 and the 2019 pivot. Short term momentum declined below neutral after Thursday’s faint negative divergence. The short term OEW charts turned negative today with the reversal level now SPX 1977. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market