SHORT TERM: gap up opening faded, DOW -21
Overnight the Asian markets gained 0.5%. Europe opened lower but gained 0.2%. US index futures were higher overnight, and the market gapped up at the open to SPX 2056. The SPX had closed at 2048 on Friday. At 10am the SPX hit 2063 and then began to pullback. Around 11:30 the SPX hit 2049, then rallied to 2058 by about 1:30, and then headed even lower. Heading into the close the SPX hit 2042 and closed there.
For the day the SPX/DOW lost 0.20%, and the NDX/NAZ lost 0.35%. Bonds were flat, Crude rose 65 cents, Gold rallied $16, and the USD was lower. Medium term support drops to the 2019 and 1973 pivots, with resistance at the 2043 and 2070 pivots. Tomorrow: Export/Import prices at 8:30, then the Budget deficit at 2pm.
The market gapped up to SPX 2056 to start the week, hit SPX 2063, and then pulled back for the rest of the day. Lots of choppy action since the SPX 2075 uptrend high. Three waves down: 2043-2067-2034, three waves up: 2061-2042-2063, and now heading lower again. In the meantime negative divergences remain on the daily chart. Short term support is at the 2019 and 1973 pivots, with resistance at the 2043 and 2070 pivots. Short term momentum touched overbought during today’s rally, then ended the day oversold. Trade what’s in front of you, but invest on what you believe is ahead.
MEDIUM TERM: uptrend weakening
LONG TERM: bear market