SHORT TERM: gap up opening again, DOW +214
Overnight the Asian markets lost 0.2%. Europe opened higher and gained 0.9%. US index futures were higher overnight. At 8:30 building permits and housing starts were reported higher. Then at 9:15 industrial production was reported higher too. The market opened at SPX 2695 and continued to rally. The SPX had closed at 2678 yesterday. By 11:30 the SPX had hit 2708. It then pulled back to 2702 by 1:30, hit 2709 by 2pm, then returned to 2702 at 2:30. In the last hour of trading the SPX hit 2713, then pulled back to 2706 to end the day.
For the day the SPX/DOW gained 0.95%, and the NDX/NAZ gained 1.95%. Bonds gained 2 ticks, Crude rose 25 cents, Gold added $1, and the USD was higher. Medium term support remains at the 2656 and 2632 pivots, with resistance at the 2731 and 2780 pivots. Tomorrow the Beige book at 2pm.
The market had a gap opening today for the 12th day in a row. Quite an amazing string of wide ranging overnight activity. Last week’s string had 4 UP and 1 DN. And despite all of the rallies being sold last week the market still gained 2%. This week we have had two gap up openings and nothing is being sold. Earnings appear to be overshadowing everything else. The beginning of this rally from SPX 2586 certainly did not look like a Minor 3 last week. The first two days of this week, however, have looked far more impulsive. Let’s see how the market handles the 2731 pivot. Short term support is at the 2656 and 2632 pivots, with resistance at the 2731 and 2780 pivots. Short term momentum ended the day quite overbought. Best to your trading!
MEDIUM TERM: downtrend may have bottomed
LONG TERM: uptrend