SHORT TERM: FED rally fades, DOW -35
Overnight the Asian markets gained 0.7%. Europe opened higher and gained 1.1%. US index futures were higher overnight. At 8:30 the PPI was reported higher: +0.4% v +0.2%, and the NY FED was reported higher: 9.0 v -6.0. Then at 9:15 Industrial production was reported lower: -0.4% v +0.7%, and Capacity utilization as well: 74.9% v 75.4%. The market opened 5 points above yesterday’s SPX 2075 close, then moved up to 2084 just before 10:30. The market then pulled back to SPX 2079 by 11:30, before drifting back up again ahead of the FOMC statement, report and press conference. At 2pm: http://www.federalreserve.gov/newsevents/press/monetary/20160615a.htm, and http://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20160615.pdf. The market initially rose to SPX 2086 after the news, then pulled back to 2070 just before a 2072 close.
For the day the SPX/DOW lost 0.20%, and the NDX/NAZ lost 0.25%. Bonds gained 13 ticks, Crude slid $1.00, Gold rose $9, and the USD was lower. Medium term support remains at the 2070 and 2043 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow: weekly jobless claims, the CPI and Philly FED at 8:30, then the NAHB at 10am.
The market opened higher today, following the rebound in Europe/Asia, rose to SPX 2084, dipped, and then hit 2086 right after the FOMC ended. The market had closed at SPX 2075 yesterday. After the press conference, however, the market gave back its gains to end the day slightly negative. Between yesterday’s low at SPX 2064, double bottom, and today’s SPX 2086 high, the market has had its best rally since the 4-day pullback began at SPX 2121. This market remains in the SPX 2026 – SPX 2121 range pending overnight action in Europe/Asia. Short term support is at the 2070 and 2043 pivots, with resistance at the 2085 and 2131 pivots. Short term momentum nearly hit overbought after yesterday’s positive divergence, then ended the day approaching oversold. Typical post-FOMC volatility. Best to your trading!
MEDIUM TERM: uptrend under pressure
LONG TERM: neutral