SHORT TERM: gap down opening reversed, DOW +2
Overnight the Asian markets lost 0.6%. Europe opened lower and lost 0.6% as well. US index futures were lower overnight, and the market gapped down to SPX 2088 at the open. The SPX had closed at 2097 yesterday. A few minutes after the open the SPX hit the 2085 pivot and then started to rally. At 10am Construction spending was reported lower: -1.8% v +0.3%, and ISM manufacturing was reported higher: 51.3 v 50.8. The market continued to work its way higher into the afternoon with two 4-point pullbacks. At 2pm the: http://www.federalreserve.gov/monetarypolicy/beigebook/beigebook201606.htm. Around 3:30 the SPX hit 2101, then pulled back to close at 2099.
For the day the SPX/DOW were +0.05%, and the NDX/NAZ were mixed. Bonds lost 4 ticks, Crude added 15 cents, Gold slipped $1, and the USD was lower. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2131 pivot. Tomorrow: the ADP at 8:15, and weekly Jobless claims at 8:30.
The market gapped down at the open today, hit the 2085 pivot, then reversed, closing the gap and moved slightly higher on the day. Today’s action was just enough to confirm uptrends in two of the four major indices. As a result we are now required to update the SPX count to display Major wave B still underway. The April SPX 2111 high becomes Int. A, the May SPX 2026 low Int. B, and an Int. C uptrend is underway. This also forces us to move the Long Term status to neutral. As a subdividing Major wave B suggests new highs are possible despite this entire advance being a bear market rally. We will provide an explanation and some details probably over the weekend. Short term support remains at the 2085 and 2070 pivots, with resistance at SPX 2111 and the 2131 pivot. Short term momentum ended the day above neutral. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: neutral