SHORT TERM: gap down opening then rebound, DOW +78
Overnight the Asian markets lost 1.0%. Europe opened lower and lost 1.6%. US index futures were lower overnight, and at 8:30 the Trade deficit was reported larger: -$41.1B v -$37.4B. The market gapped down at the open to SPX 2080, dipped to 2076, then rose to 2085 by 10am. At 10am ISM services were reported higher: 56.5 v 52.9. The market then pulled back to SPX 2074 by 10:30 and started to rally. At 2pm the FOMC minutes were released: http://www.federalreserve.gov/newsevents/press/monetary/20160706a.htm. The market rallied back to unchanged on the week, at SPX 2101, just before a 2100 close.
For the day the SPX/DOW gained 0.50%, and the NDX/NAZ gained 0.75%. Bonds lost 4 ticks, Crude gained 75 cents, Gold rose $7, and the USD was lower. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2131 and 2177 pivots. Tomorrow: the ADP at 8:15, then weekly Jobless claims at 8:30.
The market gapped down at the open today for the second day in a row. Something it hasn’t done since the Brexit vote two weeks ago. After opening below yesterday’s low the market traded down to SPX 2074 exactly when Europe closed for the day. It then rallied to 2101, its highest level of the week. The rally from SPX 1992-2109 does look impulsive after all, and the recent pullback corrective. As long as SPX 2074 holds, the next leg up is underway. Short term support is at the 2085 and 2070 pivots, with resistance at SPX 2111 and SPX 2121. Short term momentum displayed a slight positive divergence at today’s low, then rose to overbought. Best to your trading!
MEDIUM TERM: uptrend probable
LONG TERM: neutral