SHORT TERM: market tries to rebound, DOW -3
Overnight the Asian markets lost 1.1%. Europe opened lower and lost 0.4%. US index futures were lower overnight, and the market opened one point below yesterday’s SPX 2079 close. In the first few minutes the market bounced to SPX 2083, then dropped to 2073 by 10am. At 10am Wholesale inventories were reported higher: +0.4% v +0.1%. The market then bounced back to SPX 2078, before heading down to 2072 by 10:30. After that low the market started to rally. Around 1pm the SPX hit 2086, dipped to 2078 by 3:30, then bounced to 2080 to end the day.
For the day the SPX/DOW were mixed, and the NDX/NAZ were -0.10%. Bonds lost 12 ticks, Crude rallied $1.75, Gold added $2, and the USD was lower. Medium term support remains at the 2070 and 2019 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow: the Budget deficit at 2pm.
The market opened slightly lower today, bounced, made a lower low, bounced again, then hit SPX 2072 before starting to rally. Coming off that low there was a positive short term divergence, and we labeled SPX 2072 with a tentative Minute wave a on the hourly chart. There is a clear five down from Minor b’s SPX 2122: 2102-2113-2086-2101-2072. The rally that followed made it back to SPX 2086, which was the previous low. So until this market can rally higher and produce an overlap, we can only speculate Minute wave b is underway. Short term support is at the 2070 pivot and SPX 2058, with resistance at the 2085 pivot and SPX 2099. Short term momentum bounced to neutral after the positive divergence. Best to your trading!
MEDIUM TERM: downtrend
LONG TERM: bull market