Monday update

SHORT TERM: gap down opening, DOW -95

Overnight Asian markets lost 0.6%. Europe opened lower and lost 1.0%. US index futures were lower overnight, and the market gapped down at the open to SPX 2050. The market had closed at SPX 2055 Friday. In the opening minutes the market ticked down to SPX 2049, then bounced to 2056 by 10am. After that it pulled back to SPX 2048 by 11am, then bounced to 2056 again by 12:30. Then it dropped to SPX 2042 by 3:30, and bounced to close at 2047.

For the day the SPX/DOW were -0.50%, and the NDX/NAZ were -0.35%. Bonds lost 6 ticks, Crude rallied $1.25, Gold added $5, and the USD was lower. Medium term support remains at the 2019 and 1973 pivots, with resistance at the 2070 and 2085 pivots. Tomorrow: Wholesale inventories at 10am.

The market gapped down at the open today, for the fifth gap opening this month. The market found support one point below Friday’s SPX 2050 low, bounced, found support at 2048, bounced, then moved lower. Over the weekend we noted an expected a rally from around the SPX 2050 level, to a higher high and then a larger pullback. Today there were only bounces, and now the short term waves are starting to look choppy again. This opens the possibility of that larger pullback occurring/has occurred now. There is a positive divergence developing on the short term charts. Once the market rallies more than 8 points off a low we may then see a sustainable rally. Short term support is at SPX 2037 and 2028, with resistance at the 2070 and 2085 pivots. Short term momentum is displaying a positive divergence. Best to your trading!

MEDIUM TERM: uptrend probable

LONG TERM: bull market


About tony caldaro

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