SHORT TERM: gap up opening starts week, DOW +104
Overnight the Asian markets gained 1.4%. Europe opened higher and gained 3.1%. US index futures were higher overnight, and the market gapped up to SPX 2123 at the open. The market had closed at SPX 2110 on Friday. At 10am Existing home sales were reported higher: 5.35m v 5.04m. The rally continued until 11:30 when the SPX hit 2130. Then it started to pullback. The pullback lasted until 1:30 when the SPX hit 2121. The market then bounced to SPX 2125 by 3pm, then dipped to close at 2123.
For the day the SPX/DOW were +0.60%, and the NDX/NAZ were +0.70%. Bonds lost 27 ticks, Crude added 20 cents, Gold dropped $15, and the USD was higher. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2131 and 2198 pivots. Tomorrow: Durable goods at 8:30, the FHFA housing index at 9am, then New home sales at 10am.
The market gapped up at the open today for the third time in the past four trading days. During the rally the SPX past 2127, then continued on to 2130 before pulling back. This suggests to us, after months of choppy action, the market is impulsing off the recent SPX 2072 double bottom low. Should this be correct, we should get an uptrend confirmation quite soon. Short term support is now at SPX 2109 and the 2085 pivot, with resistance at the 2131 and 2198 pivots. Short term momentum hit overbought earlier today then backed off toward neutral. Best to your trading!
MEDIUM TERM: uptrend likely underway
LONG TERM: bull market