SHORT TERM: gap up and go, DOW +196
Overnight the Asian markets gained 0.2%. Europe opened higher and gained 1.1%. US index futures were higher overnight, and market gapped up to SPX 2436 at the open. The market had closed at SPX 2428 yesterday. Right after the open the market did not hesitate to move even higher. In fact, it continued to rise, with 2-point pullbacks along the way, to SPX 2455 in the last hour of trading. Then a dip at the close ended the day at SPX 2453.
For the day the SPX/DOW gained 0.95%, and the NDX/NAZ gained 1.40%. Bonds dropped 9 ticks, Crude rose 30 cents, Gold slid $6, and the USD was higher. Medium term support rises to the 2428 and 2411 pivots, with resistance at the 2456 and 2479 pivots. Tomorrow: new home sales at 10am.
The market gapped up at the open for the first time since last Monday. That day the market gained 27-points and closed near the highs. For the next couple the days the market then struggled to make higher highs, even though opening higher on both days. Then the recent selloff kicked in. Today the market gapped up and gained 27-points and also closed near the highs. Deja vous? We continue to observe three waves down from SPX 2491: 2438-2475-2417, and now a counter rally to 2455. Despite the strong day, thinking the 2456 pivot range should hold this advance, as noted in the weekend update, with possibly a short term negative divergence at the highs. Short term support is at the 2444 and 2428 pivots, with resistance at the 2456 and 2479 pivots. Short term momentum hit extremely overbought as the highs. Best to your trading!
MEDIUM TERM: downtrend probably underway
LONG TERM: uptrend