Pre-Market Brief

Good morning. Futures are flat, after being moderately higher earlier in the night. We have another batch of econ-data, most of which is issued at 10am.

*Durable Goods Orders: 0.0% vs -0.8% expected, with ex-trans +1.5%. Broadly speaking, the numbers are slightly 'better than expected', so there is your first 'green shoot of recovery' for today.


sp'60min

sp'daily5

Summary

Again, bears should take careful note that with stocks like AAPL and FB moderately higher in the pre-market, it seems likely the underlying upward trend will show through by the close of today.

Best guess, we close somewhere around 1412/15, and then hit 1425 late tomorrow or early Thursday.

I remain patiently waiting, before the next 'big short' ;)

Primary targets remain sp'1425, and then 1225

Another day where the market rallied into the close, although this apparent wave'2 bounce from the 1343 low appears to be nearing completion. Primary target remains sp'1425, which is easily within reach, and then it will be important for the bears to see a reversal..a REALLY strong reversal to the downside.

sp'weekly2, rainbow

sp'daily4

sp'daily7

Summary

First, consider the daily Fib' chart, the mid sp'1420s look very viable based on this alone.

The weekly chart is flashing a provisional sell warning with a blue candle, although if we get into the sp'1420s, this will flip to green, so its not too important right now to get focused on this issue. What is important is that we don't put in a weekly close above sp'1425

Looking ahead

We have Bernanke at breakfast time. I'm not sure whether the clown network finance TV will be taking much notice of his comments, although I guess they will be. 

Durable Goods Orders will be the key econ-data of the day, if the data at least comes in-line with expectations - no matter how 'bad' it is, then Mr Market will probably be able to rally to 1415/2.

What happens when we get to 1425...that will possibly be the remaining key turning point of this year.

Any closes in the 1440s arguably rules out any major downside wave, and I'd have to re-evaluate.

Seeking a reversal

However, if we do see a strong reversal later this week, and perhaps even closing <1400, then next week sure could be 'interesting'.

The bull maniacs who are again buying the dip, sure as hell better hope the US politicians manage to agree to delaying 'most' of the tax rises and spending cuts, otherwise Mr Market is going to have to swiftly price in a US recession in Q1 2013.

Goodnight from a rainy and chilly London

Daily Index Cycle update

The main indexes closed somewhat mixed, and well above their morning lows. The broad daily trend remains to the upside, although we are very likely close to maxing out in this cycle. Primary target remains sp'1425, which seems viable late Wednesday/early Thursday.


IWM

Sp'daily5

Trans

Summary

The closing hour was again indicative of the underlying trend, which remains to the upside. With the more volatile indexes like the Transports and Rus'2000 closing moderately higher, it is a very strong sign that the Dow/Sp will see some further upside in the next few days.

I am certainly holding to my primary target of sp'1425, which is easily within reach.

A little more later.