SHORT TERM: gap up opening, DOW +184
Overnight the Asian markets lost 0.1%. European markets were closed. US index futures were higher overnight, and at 8:30 the NY FED was reported lower: 5.2 v 16.4. The market gapped up at the open to SPX 2336, pulled back to 2332 in the opening minutes, then started to work its way higher. The market had closed at SPX 2329 on Thursday. At 10am the NAHB was reported lower: 68 v 71. The market continued to rise, with two additional 4-point pullbacks, into the last hour of trading. Heading into the close the SPX hit 2349, and closed there.
For the day the SPX/DOW gained 0.90%, and the NDX/NAZ gained 0.85%. Bonds dropped 6 ticks, Crude slid 55 cents, Gold lost $4, and the USD was lower too. Medium term support rises back to the 2336 and 2321 pivots, with resistance at the 2385 and 2411 pivots. Tomorrow: housing starts and building permits at 8:30, then industrial production at 9:15.
The market gapped up at the open for the first time since March 21st. That gap up was sold off, this one was not. The last time a gap up opening was not sold off the same day, was the uptrend high on March 1st. While today’s 20-point rally was a good way to start the week, short term momentum has already risen from quite oversold to overbought. So far it looks like a good bounce within an overall correction. With the SPX/DOW in confirmed downtrends, and the NDX/NAZ still awaiting confirmation. We would expect the latter to confirm a downtrend before this correction ends. Short term support rises to the 2336 and 2321 pivots, with resistance at the 2385 and 2411 pivots. Short term momentum ended the day overbought. Best to your trading!
MEDIUM TERM: downtrend
LONG TERM: uptrend