SHORT TERM: gap up and go rally, DOW +618
For the first three days of the week Asian markets have gained 2.3%, while European markets have gained 0.8%. The week started at SPX 2633 and hasn’t looked back. After a gap up opening on Monday and rally to SPX 2674, the market gapped down on Tuesday hitting SPX 2656 early, before rallying for the rest of the day. Another gap up opening on Wednesday took the SPX over 2700, then hitting 2744 in the afternoon, and closed there.
In the morning we had updated the charts to display a potential Int. A completed at the recent low. Then later a completed five waves down by the NAZ at its recent low. If the NAZ is going to do seven waves down to end the bear market it should run into resistance around NAZ 7320. If we are now in an uptrend the SPX could get back to 2815 before it runs into resistance. Interesting juncture in the market with the Santa rally and all. Short term support is at the 2731 and 2656 pivots, with resistance at the 2780 and 2798 pivots. Short term momentum ended the day extremely overbought after Friday’s positive divergence. Best to your trading!
MEDIUM TERM: downtrend
LONG TERM: downtrend probable