Bonds
As I mentioned last night, bonds may have set the (b) wave low yesterday. Today we saw a pretty healthy rise. Technically this could still be a (C) wave in [II] that targets 118^04 to 118^20 but given that the low yesterday had bullish divergence on the intraday chart CCI and near a weekly target, I think it prudent to assume that the (b) wave low is set on the daily and weekly charts and expect a push up through the daily moving averages.
Crude Oil
CL was down today in what might be the early stages of a wave [IV] but bears need to follow-through on Wednesday with a push down away from 85.70 to break under 84.85.
Dollar Index
DX didn’t move much on Tuesday. I wouldn’t mind DX moving a little lower and between the data on Wednesday morning and the ECB on Thursday, there will be opportunity to do so.
Euro
Euro up a bit on Tuesday to just short of the first target for a [C] of ii at 1.0929. The news on Wednesday morning and Thursday morning will determine if the wave [II] high has been set.
Gold
While I do think we are very close to a wave [III] high in gold, I don’t know if it has been set. At a minimum, bears need GC back under 2345.80 to get a retrace started.
S&P 500 Futures
The action in the S&P 500 was interesting today but consistent with what I posted in the intraday chat room which was to expect a mean reverting day. The drop in the morning was technical, a loss of the intraday hourly 20 EMA after the open took S&P 500 futures back down to deep in the recent range, but I thought it likely to recover as there wasn’t any new news or event that would give bears conviction. This turned out to be true as all of the drop was recovered by the end of the day. As to the bigger picture, I’m warming up to the idea of the wave iv low in price being set or nearly so but any move higher probably being in a [B] wave, even if it turns out to be a new high over that of the end of March. As to direction after the CPI in the morning, I don’t know. I do think 5162.00 would make good support if the initial direction is down. If moving up, 5290.00 is first overhead resistance but might stretch to 5312.00. Net, I like sideways to run the clock into a high in May.