SHORT TERM: fourth gap down opening this week, DOW -310
Overnight the Asian markets lost 0.4%. Europe opened lower and lost 2.0%. US index futures were lower overnight as well. At 8:30 the PPI was reported higher: +0.3% v -0.4%, and Retail sales were reported higher: +0.2% v +0.1%. The market gapped down at the open to SPX 2032 and continued lower until it hit 2021 in the opening minutes. Then it tried to rally. The SPX had closed at 2052 yesterday. At 10am Business inventories were reported flat, and Consumer sentiment was reported higher: 91.8 v 91.3. At 10:30 the SPX hit 2034, and then declined to 2014 by 12:30. After another rally attempt to SPX 2024 by 2:30 the market headed even lower. In the last hour of trading the SPX hit 2009, then bounced to close at 2012.
For the day the SPX/DOW lost 1.85%, and the NDX/NAZ lost 2.25%. Bonds gained 27 ticks, Crude lost $1.30, Gold rallied $6, and the USD was lower. Medium term support drops to the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Today the WLEI was reported higher: 49.2% v 48.8%, and the Q4 GNP was reported higher: +1.9% v +1.5%.
The market gapped down at the open for the fourth day this week. After opening below the mid-week low at SPX 2037, the market dropped to the 2019 pivot range. After a bounce it tested the lower end of the 2019 pivot. Then after another bounce it broke through the 2012-2026 pivot range. Needless to say, a downtrend was confirmed today. Just keep in mind that bad news is good news in this bull market. More on this in the weekend update. Best to your weekend, and do some shopping!
MEDIUM TERM: downtrend
LONG TERM: bull market