Monday update

SHORT TERM: gap down then big reversal, DOW +118

Overnight the Asian markets gained 0.5%. Europe was closed. Before the open NY FED Dudley: http://www.newyorkfed.org/newsevents/speeches/2015/dud150406.html, gave a speech. The market gapped down at the open to SPX 2057, but then immediately reversed and started to rally. At 10am ISM services was reported lower: 56.5 v 56.9. The market continued its rally until it hit SPX 2087 around 1:30. Then for the rest of the day it went sideways until the last hour of trading when it pulled back to close at SPX 2081.

For the day the SPX/DOW were +0.60, and the NDX/NAZ were +0.70%. Bonds lost 16 ticks, Crude rallied $2.80, Gold rose $14, and the USD was lower. Medium term support rises to the 2070 and 2019 pivots, with resistance a the 2085 and 2131 pivots. Tomorrow: Consumer credit at 3pm.

The market gapped down at the open in response to Friday’s ES futures decline after the Payrolls report. Immediately after the open the market started to rally. After hitting the mid-2080’s by early afternoon it ran into resistance at the OEW 2085 pivot. While the rally was impressive, like last Monday, we are still seeing choppy activity from the recent SPX 2048 low. In fact, this pullback/correction is starting to look like a mini version of the December-February Major wave 4 correction. To continue the comparison the market will need one more push down, over the next few days, to complete the pattern. Short term support is at SPX 2048 and SPX 2034/35, with resistance at the 2070 and 2085 pivots. Short term momentum hit extremely overbought today. Best to your trading!

MEDIUM TERM: still an uptrend but choppy

LONG TERM: bull market

CHARTS: http://stockcharts.com/public/1269446/tenpp

Filed under: Updates