SHORT TERM: pullbacks but rally continues, DOW +60
Overnight the Asian markets lost 0.1%. Europe opened lower and lost 0.3%. US index futures were lower overnight, and the market opened at SPX 1979. The SPX had closed at 1982 yesterday. Right after the open the market started to rally. With nothing more than two point pullbacks along the way the rally hit a new high at SPX 1986 around 1:30. At 2pm the FED released the FOMC minutes and the market started to pullback: http://www.federalreserve.gov/newsevents/press/monetary/20140820a.htm. Just past 2pm the market hit SPX 1980, bounced, retested it, and then headed higher. At 3:30 the SPX hit 1989, then dipped to close at 1987.
For the day the SPX/DOW were +0.30%, and the NDX/NAZ were mixed. Bonds lost 11 ticks, Crude added 55 cents, Gold dropped $4, and the USD was higher. Medium term support remains at the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Tomorrow: weekly Jobless claims at 8:30, then Existing home sales, the Philly FED and Leading indicators all at 10am.
The market opened five points under yesterday’s SPX 1983 high, then rallied to 1986. After the FOMC minutes were released the market had its largest pullback of the week: six points. It then rallied to SPX 1989 before closing at 1987. Thus far, we have a Minor wave 1 and 2 (1945-1928), an unfinished Minor 3 (1964-1942-1989 so far), during this uptrend. We did get two pullbacks today, but both are not noteworthy.
Short term support is at the 1973 pivot and SPX 1964, with resistance at SPX 1991 and the 2019 pivot. Short term momentum ended the day with a potential negative divergence. The short term OEW charts are still positive with the reversal level now SPX 1981. Best to your trading!
MEDIUM TERM: uptrend confirmation pending
LONG TERM: bull market