SHORT TERM: gap up opening. DOW +213
Overnight the Asian markets lost 0.2%. Europe opened lower but gained 2.1%. US index futures were higher overnight, and the market gapped up at the open to SPX 2060 and continued to rally. The SPX had closed at 2048 yesterday. At 10am New home sales were reported higher: 619K v 511K. The rally continued to rally, with only one 4 point pullback, until the SPX hit 2080 at 3:30. Then the market pulled back to close at SPX 2076.
For the day the SPX/DOW gained 1.30%, and the NDX/NAZ gained 2.00%. Bonds lost 8 ticks, Crude gained 75 cents, Gold dropped $21, and the USD was higher. Medium term support rises to the 2070 and 2043 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow: FHFA housing index at 9am.
The market gapped up at the open today after the lowest volume of the year yesterday. Overnight futures appeared to be following the DAX, as it rose 3% from its opening low to finish +2.3% on the day. After the European markets closed the SPX made only 5 additional points upside progress. Today’s high, SPX 2080, hit the lower range of the 2085 pivot, which is slightly above the level we were expecting for this Int. wave B rally from SPX 2026. Int. B could still travel a bit higher, but any intraday decline below SPX 2058 will suggest it has ended. Short term support is at the 2070 and 2043 pivots, with resistance at the 2085 pivot and SPX 2111. Short term momentum was quite overbought at the today’s high, and ended with a slight negative divergence. Best to your trading!
MEDIUM TERM: downtrend
LONG TERM: bear market