SHORT TERM: gap up opening fades, DOW -8
Overnight the Asian markets gained 0.5%. Europe opened higher but lost 0.4%. US index futures were higher overnight. At 8:30 Retail sales were reported flat: 0.0% v +0.9%, and Export (-0.7% v +0.2%)/Import (-0.4% v -0.4%) prices were reported lower. The market gapped up at the open to SPX 2105, yesterday’s high, and continued to rally. In the opening minutes the SPX hit 2110 then started to pullback. At 10am Business inventories were reported higher: +0.1% v +0.3%. Around 11am the SPX hit 2097, bounced to 2104 by 1pm, then hit 2096 by 3:30, just before a 2098 close.
For the day the SPX/DOW were -0.05%, and the NDX/NAZ were +0.10%. Bonds lost 3 ticks, Crude dropped 60 cents, Gold rallied $20, and the USD was lower. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2131 and 2198 pivots. Tomorrow: weekly Jobless claims and the PPI at 8:30.
The market gapped up at the open today, rallied to SPX 2110 in the opening minutes, then pulled back for the rest of the day. During the rally one of our four long term indicators cleared its negative divergence. This suggests the current uptrend, when it concludes, will not end Primary III, only Intermediate wave one of Major wave 5. Primary III remains on target to complete in 2016. Shorter term, the market has now rallied to its third lower high: 2126-2121-2118-2110. A rally above SPX 2118 would probably keep the uptrend going. A drop below 2086 would probably get a downtrend going. Short term support is at the 2085 and 2070 pivots, with resistance at SPX 2118/2121 and the 2131 pivot. Short term momentum rose above neutral during today’s rally, then dropped back below neutral to end the day. Best to your trading!
MEDIUM TERM: still an uptrend
LONG TERM: bull market