SHORT TERM: the wild week continues, DOW -253
Overnight the Asian markets gained 1.2%. Europe opened higher and gained 1.5%. US index futures were higher overnight as well. At 8:30 weekly Jobless claims were reported lower: 271K v 282k, and the Philly FED was reported lower: -5.9 v +1.9. The market opened three points above yesterday’s SPX 2073 close, and immediately started to sell off. At 10am Leading indicators were reported higher: +0.4% v +0.6%. The selloff continued until about 11:30 when the SPX hit 2048. Then after a bounce to 2056 by 12:30, the market hit SPX 2048 again by 1pm. After that the market rebounded to SPX 2059 by 2pm. Heading into the close the market hit SPX 2042 and closed there.
For the day the SPX/DOW lost 1.45%, and the NDX/NAZ lost 1.40%. Bonds gained 13 ticks, Crude dropped 80 cents, Gold fell $22, and the USD rallied. Medium term support drops to the 2019 and 1973 pivots, with resistance at the 2070 and 2085 pivots. Tomorrow: concludes options expiration.
After a slightly higher open today the market had its biggest decline since this potential uptrend began on Monday at SPX 1993. It has been a wild week: +3% by Wednesday, down 1.5% on Thursday. And still one more day left in the week. After five waves up to SPX 2060 early Wednesday, the market pulled back to 2042 right after the rate increase. After that the market rallied in three waves. So we thought Minor 2 had ended at SPX 2042. Today’s action suggests otherwise. We still have the five up to SPX 2060 for Minor 1, but Minor 2 now looks irregular. Irregular second waves have been popping up lately. The market displayed one in September, then another at the beginning of that huge October rally. Looks like we are dealing with a third 1-ab2 for this uptrend. Short term support is SPX 2042 and the 2019 pivot, with resistance at the 2070 and 2085 pivots. Short term momentum is declining from quite overbought to near oversold. Best to your Friday trading!
MEDIUM TERM: uptrend likely underway
LONG TERM: bull market