SHORT TERM: choppy activity continues, DOW -63
Overnight the Asian markets lost 0.5%. Europe opened lower and lost 0.5% as well. US index futures were lower overnight too. At 8:30 weekly jobless claims were reported higher: 247K v 235K, and export (0.4% v 0.2%)/import prices (-0.2% v -0.1%) were reported mixed. The market opened 7 points below yesterday’s SPX 2275 close and continued to decline. Around 11am the SPX hit its lowest level in more than a week at 2254. After that the market started to rally. The rally continued throughout the afternoon, and the SPX hit 2272 just before a 2270 close.
For the day the SPX/DOW lost 0.25%, and the NDX/NAZ lost 0.25%. Bonds gained 4 ticks, Crude rose 80 cents, Gold rallied $4, and the USD was lower. Medium term support drops back to the 2212 and 2177 pivots, with resistance at the 2270 and 2286 pivots. Tomorrow: the PPI and retail sales (est. +0.8% v 0.1%) at 8:30, then business inventories and consumer sentiment at 10am.
The market opened to the downside and continued to decline until hitting SPX 2254. After finding support there it rallied all the way back into the SPX 2270’s. Day traders delight. As noted yesterday we continue to observe declining highs and lows since the SPX 2282 all-time high. Not exactly what one would expect to see in a rising fifth wave. Unless of course, that fifth wave has concluded and the market is now in pullback/correction mode. This market needs a breakout soon, or it is likely headed for another 5% correction. Short term support is now at SPX 2254 and SPX 2245, with resistance at the 2270 and 2286 pivots. Short term momentum rose from oversold early to just above neutral. Trade what’s in front of you!
MEDIUM TERM: uptrend
LONG TERM: uptrend