SHORT TERM: decline early then rebound again, DOW +18
Overnight the Asian markets gained 0.3%. Europe opened higher but lost 0.4%. US index futures were relatively flat overnight, and at 8:30 weekly jobless claims were reported higher: 263K v 261K. The market opened unchanged at SPX 2171, bounced to 2174, and then headed lower. At 10am construction spending was reported flat: 0.0% v -0.6%, ISM manufacturing was reported lower: 49.4 v 52.6, and auto sales were reported lower. By 11am the SPX hit 2157, and then started to rebound. The rally continued into the afternoon and the market closed at its SPX 2171 high.
For the day the SPX/DOW were mixed, and the NDX/NAZ gained 0.25%. Bonds gained 2 ticks, Crude lost $1.20, Gold gained $5, and the USD was lower. Medium term support remains at the 2131 and 2085 pivots, with resistance at the 2177 and 2212 pivots. Today the Q3 GDP est. was lowered: 3.2% v 3.5%. Tomorrow: monthly payrolls (est. 190K) and the trade deficit at 8:30, then factory orders at 10am.
The market opened the day unchanged, ticked up, then dropped out of the SPX 2160-2194 trading range to 2157. Only to rally back into it, and hit SPX 2171, on a short term positive divergence. After a 200 point uptrend, this market has certainly been reluctant to establish a downtrend. Currently we can count a triple three, from SPX 2188, into today’s low: 2169-2193-2160-2183-2157. With all declines three waves in structure. Ideally, the market should tick up a bit, then decline another three waves into the OEW 2131 pivot range to complete the structure. And, the potential downtrend. Short term support is at the 2131 and 2085 pivots, with resistance at the 2177 and 2212 pivots. Short term momentum rose past neutral off this morning’s positive divergence. Trade what’s in front of you!
MEDIUM TERM: downtrend likely underway
LONG TERM: uptrend