SHORT TERM: market pulls back, DOW -159
Last night FED governor Brainard gave a speech: http://www.federalreserve.gov/newsevents/speech/brainard20151201a.htm. Overnight the Asian markets lost 0.1%. Europe opened higher but lost 0.2%. US index futures were higher, then lower, overnight. At 8:15 the ADP was reported higher: 217K v 182K. Then at 9am FED governor Tarullo also gave a speech: http://www.federalreserve.gov/newsevents/speech/tarullo20151202a.htm. The market opened two points below yesterday’s SPX 2103 close. It then ticked down to SPX 2100 in the opening minutes before hitting the high for that day at 2104 by 10am. After that the market started to pullback. The pullback continued until 12:30, when FED chair Yellen gave a speech: http://www.federalreserve.gov/newsevents/speech/yellen20151202a.htm. Then after a bounce to SPX 2098, just before 1pm, the market headed even lower. At 2pm the FED released its Beige book: http://www.federalreserve.gov/monetarypolicy/beigebook/beigebook201512.htm. Just past 3pm the SPX hit 2078, bounced to 2085 in the last hour of trading, dropped to 2077, then closed at 2080.
For the day the SPX/DOW lost 1.00%, and the NDX/NAZ lost 0.65%. Bonds lost 9 ticks, Crude dropped $1.70, Gold slid $16, and the USD was higher. Medium term support drops back to the 2070 and 2019 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow: weekly Jobless claims at 8:30, then Factory orders and ISM services at 10am. Also at 10am FED chair Yellen testifies before the Senate. Then at 1pm FED vice chair Fischer gives a speech.
The market opened slightly lower today, ticked up to SPX 2104, and then went into a rather steep pullback to 2077. We had noted the choppiness over the past week, and were using SPX 2090 as a somewhat important level. With the market’s decline below that level today the short term count is not as clear as it has been for the past couple of months. It now appears that the four waves up, (2067-2046-2097-2070), from the Major 4 low at SPX 2019, may have been Intermediate waves. And the choppy action since SPX 2070 is part of Intermediate wave v. For now, it appears SPX 2094 was Minor 1, and the 2080-2104-2077 is an irregular Minor 2. Naturally a further decline to SPX 2070 would eliminate this scenario, and some caution medium term would be advised. Short term support is at the 2070 pivot and SPX 2046, with resistance at the 2085 pivot and SPX 2104. Short term momentum ended the day quite oversold. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market