SHORT TERM: yesterday’s pullback continues, DOW -23
Overnight the Asian markets lost 0.6%. Europe opened lower but gained 0.1%. US index futures were lower overnight. At 8:30 Q3 GDP was reported higher: 3.5% v 3.2%, weekly jobless claims were reported higher: 275K v 254K, and durable goods orders were reported lower: -4.6% v 4.8%. The market opened 3 points below yesterday’s SPX 2265 close, and continued to pullback. At 9am the FHFA housing index was reported higher: 0.4% v 0.6%. Then at 10am leading indicators were reported flat, personal income was reported flat, personal spending was reported higher: 0.2% v 0.3%, the PCE was reported flat. The pullback continued to around noon when the SPX hit 2256. After that the market worked its way higher in the afternoon to close at SPX 2261.
For the day the SPX/DOW lost 0.15%, and the NDX/NAZ lost 0.35%. Bonds slipped 2 ticks, Crude rose 10 cents, Gold lost $3, and the USD was higher. Medium term support remains at the 2212 and 2177 pivots, with resistance at the 2270 and 2286 pivots. Tomorrow: consumer sentiment and new home sales at 10am.
The market opened slightly lower again today and continued the pullback that started yesterday. A week ago Tuesday the SPX hit an all-time high at 2278. The following day the FED raised rates 25 bps for the first time in a year, and the market sold off to SPX 2248. Since then the SPX has remained in that 2248-2278 range, despite two events that would have normally generated a rally: Trump’s confirmation by the electoral college on Monday and today’s best GDP report (+3.5%) in two years. During this seven trading day trading range, the short term waves have been quite choppy. Nothing looks impulsive yet to resume the uptrend. Short term support remains at SPX 2254 and SPX 2248, with resistance at the 2270 and 2286 pivots. Short term momentum was quite oversold at today’s lows, then bounced. Trade what’s in front of you!
MEDIUM TERM: uptrend
LONG TERM: uptrend