friday update -- MrSwing

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friday update
Jul 12, 2008

Tony

the ELLIOTT WAVE lives on
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SHORT TERM: market closes lower in wild ride, DOW -128I

Overnight the Asian markets were mostly lower. Europe opened higher, but closed -2.55%. US index futures were lower overnight and headed even lower after GE announced their earnings around 6:00. Then in pre-market trading FNM/FRE were cut in half on rumors that they would have to be federalized. At 8:30 the trade deficit was reported about unchanged at $60 bln, and the import price index was also reported unchanged at +2.6%. But today's attention was on FNM/FRE. At the open the market gapped down to SPX 1235, bounced to 1246 by 10:00, and then headed lower. Just after 10:00 the SPX broke through the 1240 pivot on its way to the next pivot at 1219. By 1:00 the SPX bottomed for the day at 1225. The market then rallied to 1257, closing the opening downside gap, while FED chairman Bernanke was reporting that FNM/FRE can now use the FED's discount window. The FED's expanding discount window is now open to banks, ibanks and SLM/FNM/FRE. Will the monoline bond insurers, or even GMAC be next? After the rally spiked the market settled lower into the close. For the day the SPX/DOW were -1.10%, and the NDX/NAZ were -1.20%. Bonds dropped over 1 1/4 points, Crude gained $2.95 after making a new high, Gold rallied $23.00, and the Euro was higher. Support for the SPX slips down to 1219 and then 1179, with resistance at 1240 and then 1261. Short term momentum again closed around neutral, and the near term indicators are still displaying positive divergences. It was quite a choppy week with most of the damage being done on monday (1241 low) and friday (1225 low). For the week the SPX/DOW were -1.8%, but the NDX/NAZ were only 0.3% lower. Best to your weekend!

MEDIUM TERM: downtrend hits another low at SPX 1225

LONG TERM: bear market

CHARTS: http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1606987