SHORT TERM: gap up opening sold, DOW +11
Overnight the Asian markets gained 1.1%. Europe opened higher and gained 0.9%. US index futures were higher overnight, and the market gapped up to SPX 2008. After an uptick to SPX 2009 the market started to pullback. At 10am Factory orders were reported higher: +10.5% v +1.1%, and Auto sales were mixed. The market then pulled back to SPX 1999 by noon and tried to rally again. At 1:30 the SPX hit 2005, and at 2pm the FED’s Beige book was released: http://www.federalreserve.gov/monetarypolicy/beigebook/beigebook201409.htm. Another pullback followed to SPX 1998 by 3pm, then the market bounced to close at 2001.
For the day the SPX/DOW were mixed, and the NDX/NAZ were -0.60%. Bonds gained 2 ticks, Crude rallied $2.45, Gold rose $5, and the USD was lower. Medium term support remains at the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Tomorrow: the ECB statement, ADP at 8:15, weekly Jobless claims and the Trade deficit at 8:30, then ISM services at 10am.
The market gapped up on the open today following Europe’s early rally. The SPX opened at a new high, then hit 2009 before it started to pullback. Of the three options noted yesterday, two of the three were eliminated at the open. With today’s afternoon pullback to SPX 1998 we are now seeing some choppy activity from the Minor wave 4 low at 1991. We have a rally-pullback SPX 2006-1995, and now another rally-pullback SPX 2009-1998. This morning we labeled the 2006-1995 sequence as Minute waves i and ii of Minor 5. But today’s 2009-1998 sequence appears to be a bit odd, during this uptrend, for a Minute iii. With the much awaited ECB statement tomorrow we remain cautious.
Short term support is at SPX 1995 and the 1973 pivot, with resistance at SPX 2009 and the 2019 pivot. Short term momentum hit overbought this morning then dropped below neutral. The short term OEW charts flip-flopped again today, ending negative, with the reversal at SPX 2002. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market