Thursday update

SHORT TERM: gap down opening then rebound, DOW -45

Overnight the Asian markets lost 1.2%. Europe opened lower and lost 1.0%. US index futures were lower overnight as well. At 8:30 weekly jobless claims were reported the lowest since 1973: 246K v 249K, and export prices rose: 0.4% v -0.4% while import prices remained unchanged: 0.0% v 0.0%. The market gapped down to SPX 2125 at the open and continued lower. The SPX had closed at 2139 yesterday. By 10am the SPX hit 2115 and then started to rally. The rally continued into the last hour of trading when the SPX hit 2138 just past 3pm. Then after a pullback to SPX 2130, the market closed at 2133.

For the day the SPX/DOW lost 0.25%, and the NDX/NAZ lost 0.40%. Bonds gained 10 ticks, Crude rose 25 cents, Gold added $3, and the USD was lower. Medium term support is again at the 2131 and 2116 pivots, with resistance at the 2177 and 2212 pivots. Tomorrow: the PPI and retail sales at 8:30, business inventories and consumer sentiment at 10am, then a speech from FED chair Yellen at 1:30.

The market gapped down at the open today broke the OEW 2131 pivot, then traded down to the 2116 pivot before bottoming at 2115, and then rallied. The overnight selling was reportedly attributed to the slowdown in China. But the SSEC finished positive, plus gold and crude did not do much. So it appears the decline was mostly technical. At the low the SPX found the support area we were expecting, and then rallied to nearly turn positive after being down 24 SPX points. The Minor wave 2 downtrend may have ended this morning, with a short term positive divergence. Short term support is back to the 2131 and 2116 pivots, with resistance at the 2177 pivot and SPX 2194. Best to your trading!

MEDIUM TERM: downtrend may have bottomed

LONG TERM: uptrend


About tony caldaro

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117 Responses to Thursday update

  1. fotis2 says:

    Cant say that is decent close for bulls.

  2. zvyezda says:

    It seems that today’s pin will be 213.50 on the SPY. Max pain is 214.50.

  3. captbara says:

    Still seems safe, as long as Dax remains in the upper half of the daily bull flag. US markets now becoming weaker than its overseas counterparts.

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