The XJO is expected to open lower this morning following a lacklustre night in the U.S, which saw their market sell down intraday gains to finish practically flat. Their futures are mildly in the green.
Yesterday we rebounded off all-time high resistance at roughly 8,750 on open. We sold off for the rest of the session, returning to sit just above 8,700. We held the short-term uptrend line that had tentatively formed over the past week or so, however it will likely fail on open this morning.
We should open near 8,770, a level that our market has opened and closed at a few times since breaking higher last Friday. It seems to be the comfort point for the current range. Resistance is clearly represented by our all-time high at roughly 8,750, and support is roughly our previous all-time high at roughly 8,630. With our pullback from resistance yesterday, it seems we are tracking sideward once again at the top of the range.
We should continue to assume we will break higher at some point, as the underlying uptrend remains firmly bullish. However, with the U.S looking very tired, it is also fair to assume we will continue to consolidate before we do.
US Markets
US shares were mixed overnight, with the DOW JONES closing firmly lower, while the NASDAQ and SP500 closed higher. The SP500 and NASDAQ were dragged higher by Google, who rose after a decent earnings result. Outside of some high performing tech and energy stocks, it was otherwise a fairly negative session for US markets, with most other sectors seeing notable selling. As opposed to the strength in Google, Tesla saw notable selling after its own dissappointing earnings numbers. Overnight US economic data was mostly positive, with fewer jobless claims than expected. Still, US shares are definitely slowing up here, which could suggest that some profit taking is coming.
Only three of the eleven sector groups of the SP500 closed higher overnight, which were Energy, Technology, and Communications. Every other sector closed lower, with Discretionary and Materials the worst performers.
Technically, the SP500 has now broken clearly beyond the previous all-time high resistance at 6,300. This indicates further upwards movement, though its hard to say where the move may head. The previous resistance at 6,300 is now likely to act as support.