SHORT TERM: gap down opening, DOW -91
Overnight the Asian markets lost 0.6%. Europe opened lower and lost 1.4%. US index futures were lower overnight. At 8:30 weekly Jobless claims were reported lower: 278K v 294K, and the Philly FED was reported lower: -1.8% v -1.6%. The market gapped down at the open to SPX 2039, then declined to 2028 by 10am. The market had closed at SPX 2048 yesterday. At 10am Leading indicators were reported higher: +0.6% v +0.2%. The market then bounced to SPX 2035 by 10:30, before heading to 2026 just past 11am. Then the market started to rally. Heading into the close the market hit SPX 2042, then dipped to close at 2040.
For the day the SPX/DOW were -0.45%, and the NDX/NAZ were -0.55%. Bonds gained 9 ticks, Crude lost 15 cents, Gold slipped $2, and the USD was higher. Medium term support drops to the 2019 and 1973 pivots, with resistance at the 2043 and 2070 pivots. Tomorrow: a speech from FED governor Tarullo at 9am, Existing home sales at 10am, and it’s Options expiration Friday.
The market gapped down at the open for the first time in two weeks. The market then made a new downtrend low at SPX 2026, within the upper range of the 2019 pivot. After that the market started to rally. While the trend is still down, if the SPX can clear the 2043 pivot it is possible it could rally back to the 2070 pivot. Pivot ping pong so to say. After that it should resume the downtrend. Short term support is at the 2019 and 1973 pivots, with resistance at the 2043 and 2070 pivots. Short term momentum displayed a very slight positive divergence at today’s lows. Trade what is in front of you!
MEDIUM TERM: downtrend
LONG TERM: bear market