SHORT TERM: choppy day, DOW -28
Overnight the Asian markets lost 0.7%. Europe opened higher and gained 0.7%. US index futures were higher, and at 9am Case-Shiller was reported lower: +6.7% v +8.1%. The market opened four points above yesterday’s SPX 1978 close and immediately began too pullback. At 9:45 the Chicago PMI was reported lower: 60.5 v 64.3, then at 10am Consumer confidence was reported lower: 86.0 v 92.4. The pullback ended just past 10am at SPX 1970 and the market started to rally. At 11:30 the SPX hit 1985, then the market started to pullback again. At 12:30 the SPX hit 1973, rallied to 1978 by 1pm, then dropped to 1969 by 1:30. Another rally carried the market to SPX 1978 by 3:30, then a pullback ended the day at 1972.
For the day the SPX/DOW were -0.20%, and the NDX/NAZ were mixed. Bonds lost 3 ticks, Crude dropped $3.15, Gold slipped $8, and the USD was higher. Medium term support slips to the 1956 and 1929 pivots, with resistance at the 1973 and 2019 pivots. Tomorrow: the ADP index at 8am; ISM manufacturing, Construction spending and Auto sales at 10am.
The market opened a few points higher today. Dropped to SPX 1970, then rallied to 1985 before heading lower again. After a week of choppy downward activity we have now had two days of sideways choppy activity. We continue to count the downward choppy activity as a 55 point ‘a’ wave: 1979-2000-1966-1986-1964. And now count the choppy sideways activity as a 21 point ‘b’ wave: 1980-1971-1982-1970-1985. A ‘c’ wave should now be underway from today’s SPX 1985 high. We still favor the Primary IV scenario 65%-35%. Short term support is at SPX 1964 and the 1956 pivot, with resistance at the 1973 pivot and SPX 1986. Short term momentum again spent the day vacillating neutral. Best to your trading!
MEDIUM TERM: uptrend in jeopardy
LONG TERM: bull market