TRADING 04 FUTURES

[TREND1]

friday update by tony caldaro


SHORT TERM: market gaps down, DOW -124

Overnight the Asian markets declined 0.3%. European markets opened lower and closed -1.4%. US index futures were lower overnight, and at 8:30 the Payrolls report came in lower than expected: +80K vs +69K. The Unemployment rate remained at 8.2%. The market gapped down at the open to SPX 1359 and continued to decline. The SPX had closed at 1368 yesterday. Around noon the SPX had declined to 1349 and tried to rally. The rally ended up as a bounce to SPX 1353 by 1:30. Then the market headed back down. Around 2:30 the SPX hit 1348 and tried to rally again. Heading into the close the SPX hit 1356 and end the week at 1355.

For the day the SPX/DOW were -0.95%, and the NDX/NAZ were -1.30%. Bonds gained 11 ticks, Crude lost $3.05, Gold dropped $20, and the USD was higher. Support for the SPX drops to the 1313 and 1303 pivots, with resistance back again at the 1363 and 1372 pivots. Short term momentum was quite oversold at the lows, then bounced with the rally. Today the WLEI upticked for the first time in quite a while: 47.1% vs 46.4%.

The market resumed its pullback today after the monthly Payrolls report came in lower than expected. After a gap down opening the market declined steadily to SPX 1349, with only 2-3 point bounces along the way. An attempted rally around noon could only gather four points to the upside. Then the market headed back towards the lows.

The SPX had cleared the OEW 1363 support pivot minutes after the open, and headed toward the 1342/47 support zone. It found support just one point above at SPX 1348 around 2:30, and then rallied into the close. This 27 point pullback fits well with what was expected. Short term momentum got quite oversold during the decline, and the market held support. Once the SPX clears 1358 the uptrend should resume. Best to your weekend!

MEDIUM TERM: uptrend

LONG TERM: bull market

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