SHORT TERM: new highs then pullback, DOW -31
Overnight the Asian markets gained 0.6%. Europe opened higher and gained 0.1%. US index futures were higher overnight, and the market opened at a new high SPX 2006 but immediately started to pullback. At 10am ISM manufacturing (59.0 v 57.1) was reported higher, and Construction spending (+1.8% v -1.8%) as well. The market hit SPX 2001 at 10am, rallied to 2006 by 11am, and then started to pullback again. At 1:30 the SPX hit 1995, got oversold, and started to rally. Heading into the close the SPX hit 2002 and closed there.
For the day the SPX/DOW were -0.10%, and the NDX/NAZ were +0.35%. Bonds lost 17 ticks, Crude dropped $2.80, Gold fell $22, and the USD was higher. Medium term support remains at the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Tomorrow: Factory orders and Auto sales by 10am, then the FED’s beige book at 2pm.
The market opened at a new high today, then immediately began to pullback. During the open we upgraded the Minor 4 label to dark blue, as Minor wave 5 appears to have been underway. After the open the market reached the inflection point. It now has three options. (1). most bullish: the pullback underway continues lower, but the 5 waves up from SPX 1905 is only Minor 1 of Int. v. (2). less bullish: today’s pullback is only Minute ii of Minor 5, and the market should continue higher. (3). bearish: today’s high marked the end of the uptrend including Primary III, and Primary IV is underway. With negative divergences on every timeframe it appears it is time to get cautious.
Short term support is at SPX 1991 and the 1973 pivot, with resistance at SPX 2006 and the 2019 pivot. Short term momentum put in a negative divergence at the open, sold off to oversold, then bounced to above neutral. The short term OEW charts flip-flopped today, ended positive, with the reversal level now SPX 2000. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market