Wednesday update

SHORT TERM: quiet open and choppy day, DOW -51

Overnight the Asian markets lost 0.6%. Europe opened lower but gained 0.7%. US index futures were sharply lower but recovered before the open. The market opened two points above yesterday’s SPX 1943 close, ticked up to 1946, dipped to 1938, then rallied to 1950 by 11am. After that the market declined to SPX 1933 by noon, then turned around and rallied to 1945 by 2pm. After that continued choppiness into the close with a decline to SPX 1936, then a bounce to 1939 to end the day.

For the day the SPX/DOW were -0.25%, and the NDX/NAZ were -0.05%. Bonds lost 7 ticks, Crude dropped $1.65, Gold rallied $4, and the USD was lower. Medium term support remains at the 1929 and 1901 pivots, with resistance at the 1956 and 1973 pivots. Tomorrow: weekly Jobless claims and Durable goods at 8:30, New home sales at 10am, then a speech from FED chair Yellen at 5pm.

The market opened higher today, rallied to SPX 1950, and then declined to 1933. At the SPX 1950 high it looked like the market had completed four waves from Monday’s 1980 high: 1956-1972-1929-1950-xxxx. The decline to SPX 1933 fell 4 points short of completing a fifth wave (1929). Then the market reversed and rallied to SPX 1945 in mid-afternoon. This activity puts the short term count in a bit a of quandary. Did wave 3 end with a fifth wave failure? Is today’s activity still in the 4th wave of wave three? Or, is the 5th wave subdividing? Clearly we need more data at this point to sort it out. Short term support is at the 1929 and 1901 pivots, with resistance at the 1956 and 1973 pivots. Short term momentum stayed around neutral for most of the day. Best to your trading!

MEDIUM TERM: downtrend

LONG TERM: bull market

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

Filed under: Updates