SHORT TERM: rally fades, DOW -42
Overnight the Asian markets lost 0.7%. Europe opened lower and lost 1.0%. US index futures were relatively flat overnight. At 8:30 monthly payrolls were reported higher: 161K v 156K, the unemployment rate was lower: 4.9% v 5.0%, and the trade deficit declined: -$36.4B v -$40.7B. The market opened 5 points below yesterday’s SPX 2089 close, and immediately started to rally. After hitting SPX 2092 in the opening minutes, it pulled back to 2085 by 10am, and then moved even higher. Just past noon the SPX hit 2099, then began to pullback. The pullback lasted all afternoon, as the SPX returned to 2085 again at the close.
For the day the SPX/DOW lost 0.20%, and the NDX/NAZ lost 0.30%. Bonds gained 10 ticks, Crude lost 50 cents, Gold added $1, and the USD was lower. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2116 and 2131 pivots. Today the WLEI was reported lower: 57.3% v 58.0%, and the Q4 GDP estimate was raised to 3.1% v 2.1%.
The market opened lower today, hit the downtrend low at SPX 2084, and then started to rally. The rally carried the SPX to just under 2100m at 2099. Then the market nearly retraced today’s entire advance. It was 1pm last Friday that the FBI indirectly announced they were looking into the Clinton-probe again. At the time of the announcement the SPX was trading at 2141, and had been in a 2115-2195 trading range for nearly three months. After that report the market dropped from SPX 2141-2084 this morning. This appears to be mostly an election related decline. The election is Tuesday. Will review the technicals in detail in the weekend update. Best to your weekend!
MEDIUM TERM: downtrend
LONG TERM: uptrend