SHORT TERM: gap up opening, DOW +46
Overnight the Asian markets open, finished higher. European markets opened higher and gained 1.0%. US index futures were higher overnight. At 9am FED governor Tarullo’s speech: http://www.federalreserve.gov/newsevents/speech/tarullo20150504.htm was released. The market gapped up to SPX 2114 at the open and rallied to 2121 by 10am. The market had closed at SPX 2108 on Friday. At 10am Factory orders were reported higher: +2.1% v +0.2%. After a pullback to SPX 2113 by 1pm the market tried to rally again. By 2:30 the SPX hit 2118, then dipped to close at 2114.
For the day the SPX/DOW were +0.25%, and the NDX/NAZ were +0.15%. Bonds lost 3 ticks, Crude slipped 20 cents, Gold rallied $10, and the USD was higher. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2131 and 2198 pivots. Tomorrow: the Trade deficit at 8:30, then ISM services at 10am.
The market gapped up at the open today for the second day in a row. Within the first half hour of trading the SPX came within 5 points of the all time high at 2126. After that, and an extreme short term overbought condition, the market started to pullback. Nothing has changed from the two counts posted over the weekend. The market could be rising to finish the ‘e’ wave of a diagonal triangle, as noted on the daily chart. One of the four negatively diverging long term indicators, we noted over the weekend, improved today. In fact, if it continues to move higher it could eliminate the divergence. Then the potential P4 correction would drop to a low probability. Will keep everyone posted. Short term support remains at the 2085 and 2070 pivots, with resistance at SPX 2121 and the 2131 pivot. Short term momentum hit extremely overbought at today’s high then pulled back. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market