SHORT TERM: gap down open again, DOW -100
Overnight the Asian markets lost 0.4%. Europe opened lower and lost 1.1%. US index futures were lower overnight as well. At 8:15 the ADP was reported lower: 156K v 200K, and at 8:30 the Trade deficit reportedly narrowed: -$40.4B v -$47.1B. The market gapped down at the opening to SPX 2053. The market had closed at SPX 2063 yesterday. In the opening minutes of trading the market dropped to SPX 2048, and then began to rally. At 10am Factory orders were reported higher: +1.1% v -1.7%, and ISM services was higher: 55.7 v 54.5. Just after 10am the SPX hit 2059, again failing to close the gap, and then began to pullback again. At 2pm the SPX hit 2046, rallied to 2054 by 3:30, then closed at 2051.
For the day the SPX/DOW lost 0.55%, and the NDX/NAZ lost 0.75%. Bonds gained 7 ticks, Crude added 25 cents, Gold dropped $7, and the USD was higher. Medium term support remains at the 2043 and 2019 pivots, with resistance at the 2070 and 2085 pivots. Today: Q2 GDP was lowered to +1.7% v +1.8%. Tomorrow: weekly Jobless claims at 8:30.
The market gapped down at the open for the second day in a row. It has not done this since early March. Just after the open the SPX took out Friday’s 2052 low by 4 points. Then after a rally to SPX 2059, the market made a lower low at 2046. After that the market bounced into the close. Techs continue to lead to the downside. Short term support is at the 2043 and 2019 pivots, with resistance at the 2070 and 2085 pivots. Short term momentum was quite oversold at today’s lows, then bounced. Trade what’s in front of you!
MEDIUM TERM: downtrend should be underway
LONG TERM: bear market