SHORT TERM: lower open then new highs, DOW +107
Overnight the Asian markets gained 0.5%. Europe opened higher and gained 0.4%. US index futures were flat to lower overnight. At 8:30 the CPI was reported higher: 0.6% v 0.3%, the NY FED was reported higher 18.7 v 6.5, and retail sales were reported higher: 0.4% v 0.6%. Then at 9:15 industrial production was reported lower: -0.3% v 0.8%, as was capacity utilization: 75.3% v 75.5%. The market opened 3 points below yesterday’s SPX 2338 close, then immediately started to work its way higher. At 10am business inventories were reported higher: 0.4% v 0.7%, and the NAHB was reported lower: 65 v 67. The market then rallied to SPX 2345 just before 11am, dipped to 2339 by 11:30, then moved even higher. Just past 3pm the SPX hit 2351, then dipped to end the day at 2349.
For the day the SPX/DOW gained 0.50%, and the NDX/NAZ gained 0.60%. Bonds lost 9 ticks, Crude slid 15 cents, Gold added $5, and the USD was lower. Medium term support remains at the 2336 and 2321 pivots, with resistance at the 2385 pivot. Tomorrow: housing starts, building permits, weekly jobless claims and the Philly FED all at 8:30.
The market opened slightly lower again today, but immediately reversed and started making new highs. Just past 11am the SPX cleared the 2336 pivot, pulled back, and then headed higher. The market has now risen from late-January and SPX 2267 to SPX 2351, with the largest pullback only 17 points. This 3-month uptrend, which started at SPX 2084 in early-November, is now nearing our initial SPX 2380’s target posted in early November. Market breadth is making new highs, daily/weekly MACD’s are moving higher, but the hourly/daily/weekly RSI’s are getting a bit frothy. Would not be surprised to see a 20+ point pullback soon. Then higher highs. Short term support is at the 2336 and 2321 pivots, with resistance at the 2385 pivot. Short term momentum is extremely overbought. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: uptrend