Whipsaw Wednesday

Sort of a roller coaster day in the markets today as we started off strong and hit 823 then fell off a cliff down to 787 before a last hour rally closed up around 810. Pretty incredible action today imo. A positive sign that we held 800 and closed higher on the day, even if it was the shorts caught in the last hour that had to cover. Quite a range intraday nevertheless.

Some positive home sales and durable goods data this morning is a good sign that the economy could be turning. Also, lumber futures had a big up day off that data on Wed. and look to be putting in a solid basing pattern lately along with other growth oriented commodities as well. Lumber is a key commodity that needs to bottom before the housing market does and I think the first steps of that process are being seen.

Going into Thursday I am bullish and think you gotta buy the 805 area if you get a chance. A nicely defined risk trade as this area seems to be a good pivot to work off of lately. As long as we hold over 800 then I think we go higher. The pivot for Thursday is at 806.75 and I can see this market resuming the rally if that pivot holds as support. The 840s are not too far away if we can get some momentum.