wednesday update -- MrSwing

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wednesday update
Dec 11, 2008

Tony

ELLIOTT WAVE LIVES ON
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SHORT TERM: market holds on to gains in choppy day, DOW +70

Overnight all the Asian markets were higher. Europe open lower and closed mixed. US index futures were higher overnight and the market gapped up to SPX 900 at the open. It closed at 889 tuesday. By 10:00 the market had pulled back to 892, when Wholesale inventories were reported -1.1% v -0.1%. A zigzag rally followed, first to 904 by 10:30, then 894 by 11:00, and finally 908 at 12:00. That was the high for the day, and again the market failed to break through the 912 pivot. As the market started to pullback, at 2:00 the Trade deficit was reported at $164.4 bln v $98.2 bln. By 2:30 the SPX hit its low for the day at 885, right at yesterday's low and slightly above monday's low. It then reversed and rallied into the close at 899. Today the market effectively gapped up at the open and ended closing there. For the day the SPX/DOW were +1.00%, and the NDX/NAZ were +1.00%. Bonds lost 10 ticks, Crude gained $1.50, Gold rallied $33.00, and the Euro was higher. Support for the SPX remains at 848 and then 789, with resistance at 912 and then 935. Short term momentum hovered around neutral most of the day. Tomorrow the weekly Jobless claims, the Trade deficit and the import Price index all at 8:30. Then the Flow of Funds Accounts of the US at 12:00.

The market appears to be preparing to rally to complete the first abc from the SPX 741 low. The fibonacci upside targets remain at SPX 973 (c=a) and 1068 (c=1.62a). There is a SPX pivot at 961, and once the SPX can break through 920 that would be the next objective. Best to your trading!

MEDIUM TERM: downtrend low at SPX 741

LONG TERM: bear market rally underway

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