SHORT TERM: gap down opening again, DOW -118
Overnight the Asian markets lost 0.8%. Europe opened lower and lost 1.4%. US index futures were lower overnight, and the market gapped down at the open to SPX 1972. The market had closed at SPX 1978 yesterday. The market continued to decline, with 3 and 4 point bounces, until it hit SPX 1959 around 12:30. Then it tried to rally. Around 1:30 the SPX hit 1968, then pulled back again. At 3pm Consumer credit reportedly increased at a lower rate: +$19.6bn v +$26.8bn. Also at 3pm the SPX hit 1963, then it bounced to close at 1964.
For the day the SPX/DOW were -0.70%, and the NDX/NAZ were -1.25%. Bonds gained 12 ticks, Crude was flat, Gold was flat, and the USD was lower. Medium term support drops to the 1956 and 1929 pivots, with resistance at the 1973 and 2019 pivots. Tomorrow: the FOMC minutes at 2pm.
The market gapped down at the open today for the second day in a row. After 10am the SPX dropped below the 1973 pivot range, on its way to the 1956 pivot range. Around 11:30 the SPX dropped below 1962, suggesting the uptrend had ended at 1986. We posted a green Int. iii label, see yesterday’s update, on the hourly chart. Around 12:30 the SPX hit its low for the day at 1959, and started to rally from an extremely oversold condition. While it does look like this week has started the Int. wave iv downtrend. The market needs to drop below the SPX 1959 low next, to continue the downside momentum.
Short term support is at the 1956 and 1929 pivots, with resistance at the 1973 pivot and SPX 1986. Short term momentum hit extremely oversold by midday then bounced. Short term OEW charts remain negative with the reversal level now SPX 1969. Best to your trading tomorrow’s Minutes!
MEDIUM TERM: uptrend may have topped
LONG TERM: bull market