Wednesday update

SHORT TERM: another gap down opening, DOW -252

Overnight the Asian markets lost 0.9%. Europe opened lower and lost 1.1%. US index futures were sharply lower overnight. At 8:15 the ADP was reported higher: 257K v 217K, and at 8:30 the Trade deficit lower: -$42.4B v -$43.9B. The market gapped down to SPX 1993 at the open, then traded down to 1986 in the opening minutes. The market had closed at SPX 2017 yesterday. At 10am ISM services was reported lower: 55.3 v 55.9, and Factory orders were lower: -0.2% v +1.5%. The market then rallied to SPX 2003 by 11:30 before heading lower again. At 2pm the FED released its FOMC minutes: After the release the market dropped to SPX 1979, rallied to 1992, then closed at 1991.

For the day the SPX/DOW lost 1.40%, and the NDX/NAZ lost 1.00%. Bonds gained 20 ticks, Crude dropped $2.00, Gold rose $14, and the USDF was lower. Medium term support remains at the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Tomorrow: weekly Jobless claims at 8:30.

The market gapped down at the open today for the third time in the past four days. After making a new low for the downtrend at SPX 1986 the market rallied to 2003. Then in the afternoon it made an even lower low at SPX 1979 after the FOMC minutes. Despite the steady selling so far this week, SPX down ~2.5%, we see a cluster of support levels just below the market that could end this Major 2 downtrend. At SPX 1971 Int. C = Int. A, at SPX 1965 Minor C = 0.62 Minor A, and at SPX 1967 Minute C = Minute A. All three of these levels are nearly within the lower end of the 1973 pivot range (1966-1980). With short term momentum getting oversold and displaying a positive divergence. And medium term momentum reaching the typical oversold condition for downtrends in this bull market. We could be approaching the end to this downtrend soon, with good support in the 1973 pivot range. Short term support is at the 1973 and 1956 pivots, with resistance at SPX 2003 and the 2019 pivot. Best to your trading in this volatile market!

MEDIUM TERM: downtrend

LONG TERM: bull market


About tony caldaro

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472 Responses to Wednesday update

  1. purplember says:

    China – my prediction is it will open with big down in first hour or so then gov’t will manipulate it and strong rebound during day.

    no way will they let it go down 10-15%

    • kevinmick says:

      China lifted sell restrictions , they are probably going to make the PPT look like a lemonade stand. I predict they pour as many reserves as need to China market open and close flat to up and SPX rallies big tomorrow

  2. kvilia says:

    Will we get the 15 min fireworks before the close?

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