SHORT TERM: gap up – new highs, DOW +76
Overnight the Asian markets gained 0.3%. Europe opened higher and gained 1.7%. US index futures were higher overnight, and the market gapped up to new highs at the open: SPX 1997. The SPX had closed at 1988 on friday. As the rally continued New home sales were reported higher at 10am: 412k v 406k. By 11:30, when Europe closed, the SPX hit 2002. Then it started to pullback. At 1pm the SPX hit 1996. Then it drifted higher to end the day at SPX 1998.
For the day the SPX/DOW were +0.45%, and the NDX/NAZ were +0.40%. Bonds gained 3 ticks, Crude slipped 20 cents, Gold dipped $5, and the USD was higher. Medium term support remains at the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Tomorrow: Durable goods at 8:30, Case-Shiller and the FHFA at 9am, then Consumer confidence at 10am.
The market gapped up at the open to SPX 1997, then continued on to 2002 just as Europe closed. After that it pulled back some, but nothing meaningful as of yet. For the past couple of weeks this market appears to be following Europe. Not perfectly day to day, but in the general direction. Suspect ECB’s Draghi will announce something big on Sept. 4th. If not, both Europe and the US are likely to be quite disappointed. We labeled friday’s SPX 1985 low as Minute iv right after the open. Maybe SPX 2002 was the Minute v high, maybe not. Should the market drop to SPX 1993 it would increase the probabilities that it was the high.
Short term support is at SPX 1985 and the 1973 pivot, with resistance at SPX 2002 and the 2019 pivot. Short term momentum displayed a negative divergence at today’s high. The short term OEW charts turned positive with the reversal level now SPX 1996. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market