tuesday update

SHORT TERM: rebound continues, DOW +26

Overnight the Asian markets gained 0.5%. European markets also gained 0.5%. US index futures were lower overnight, and the market opened lower at SPX 1274. The SPX had closed at 1278 yesterday. Within the first few minutes the market started to rally. At 10:00 ISM services was reported higher: 53.7 vs 53.5. The rally continued until about 10:30 when the SPX hit 1285. A pullback followed to SPX 1278 by noon. Then the market tried to rally again. Heading into the close the SPX hit 1288, and settled at 1286.

For the day the SPX/DOW were +0.40%, and the NDX/NAZ were +0.50%. Bonds lost 8 ticks, Crude gained 25 cents, Gold slipped $2, and the USD was higher. Support for the SPX remains at the 1261 and 1240 pivots, with resistance at the 1291 and 1303 pivots. Short term momentum rose to slightly overbought from yesterday’s extremely oversold level. Tomorrow, Productivity at 8:30 then the FED’s Beige book at 2:00. Also tomorrow, FED governor Tarullo testifies before the Senate at 10:00, and Vice chair Yellen gives a speech at 7PM in Boston.

The market opened lower today but quickly resumed the rebound from yesterday’s SPX 1267 low. When the market entered the SPX 1280′s we posted a green tentative Minor wave 3 label at yesterday’s low. After the pullback and rally to a higher high we upgraded the label to dark blue. It appears Minor wave 3, of Intermediate wave C, ended at SPX 1267, and Minor wave 4 is currently underway. The upside limit for Minor 4 should be within the OEW 1291 pivot range, (+/- 7 points). Then, another decline should end with a Minor wave 5 low, Intermediate wave C low, and a Major wave 2 low. This could happen as early as this week.

Support for the SPX remains at the 1261 and 1240 pivots, with resistance at the 1291 and 1303 pivots. Short term momentum is slightly overbought. The short term OEW charts remain with a negative bias from SPX 1323, with the positive swing point now just under 1300. Best to your trading!

MEDIUM TERM: downtrend

LONG TERM: bull market

CHARTS: http://stockcharts.com/public/1269446/tenpp

About tony caldaro

Investor
This entry was posted in Updates and tagged , , , . Bookmark the permalink.

163 Responses to tuesday update

  1. 5 waves down, 3 waves up underway…. SP 500
    http://chart.ly/4l5jonn

    then another 5 down me thinks…

    peace

  2. M1 says:

    Ok…I am just starting to see a few shorters running to cover

  3. budfox9450 says:

    Tony – tough call tonight – Best Wishes….

  4. H D says:

    DOW 12345.67 I doubt they can pull it off. It ain’t funny anyways!

  5. M1 says:

    Good day all, yes, we have a rally, but I honestly don’t see shorters running to cover….at least not yet. Meanwhile, enjoy the ride.
    GL

  6. Ryan Parker says:

    My latest thoughts. Is this the real deal or an irregular flat? Too early to tell but some things to watch for.
    http://equitybriefcapital.wordpress.com/2012/06/06/this-rally-looks-like-the-real-deal/

    • mike7x says:

      Deal or no deal Ryan? I say “deal”! IMO the PM’s may have bottomed and are forecasting more QE ahead. I think today there may just be some profit-taking in gold. Cheers!

  7. rc1269 says:

    anybody got any color on Gold here? getting whacked

  8. optiontimer says:

    Short Sellers = Inspired Buyers
    I’m now 50% long basis the QQQ’s.
    I am now of the opinion that the low is in … I’ll be 200% long with the nest few weeks.

    And I am now looking forward to the daily report where Tony selects “Welcome to Wave III” as the title. Maybe not today, but someday, and sooner rather than later.

    Thanks for the blog Tony – you seem to have gathered a good group around you here. Even the cranks can be useful!

  9. Lee X says:

    CLN
    99.99% retrace of pit range …the folks who didnt panic 2 days ago sold 86 + today and are now flat and saying Ill never do that again ,,,I dont believe em

    • Lee X says:

      should get some fireworks in ES
      GL guys !

      • CB says:

        thanks Lee..same to you!!..need those firework down down down against 1311 pls… really enough is enough for one day

      • Lee X says:

        Hey C B
        R3 is @ 1311.25
        and guys are short in the hole here after the FED minutes
        JMO

      • Lee X says:

        Hey C B
        Are u looking to get long ?

      • CB says:

        thanks Lee! Appreciate it. Our r3 in spx cash was 1304 if my #s are correct.
        No I already got out of my long ( too early, of course :( now I am short just like ur guys – a bit in the whole thinking the market will make me whole … can you tell the world what ur doing…or it’s a secret.. :)

      • CB says:

        lol…in the hole…sound better

      • Lee X says:

        Hey C B
        Im flat ES here
        If I get a chance to sell the hole I’ll try tonite :)

      • CB says:

        thanks Lee! I am like that kid in ur vid right now…totally didn’t realize we only did 3 waves earlier today..think we’ve got the 5th on intraday now though…

  10. 1310 resistance line, 1319 20 day MA resistance line also. If we can get over , 1326, 1344, 1361 for B wave eventually. Saw 5 waves down from 1422, a bit different from tony ZIG ZAG from 1415 ABC call… so we will see how it plays out

    My projection would be 5 down, 3 up, 5 down… and this should be early part of 3 up

    http://chart.ly/4l5jonn

    I dont trade the indices, but they are fun to forecast.

  11. My prophecy of a rally today came true.The next prophecy is of a down day tomorrow and on Friday.The signs should start today before close.

  12. mike7x says:

    Nice volume so far today. That’s with the number of comments here. Could be a record Tony? (Plz let us know at end of day.) Oh, yeah, the markets not doing bad either. :)

  13. Lee X says:

    Hey Tony just 1 question
    Did we just overlap on the DJIA ?
    Thanks
    Last Fridays gap* just got tickled in futures

  14. budfox9450 says:

    If we can say – 1266 was a Major 2 low – then we should be nearing the
    end of the W1 up, off that 1266 low. OTW, this is merely a Bull trap,
    yet with sentiment so low – that to does not seem so likely either…
    Looking to Buy the dip below 1296-1290…looking at SSO.

  15. Igor says:

    Wave 4 overlapped wave 1 on the 60-min SPX Tony’s chart.

  16. piazzi says:

    Tony,

    this is very interesting

    I think uptrend ended in March and what followed as a rally was an irregular B wave

    but I cannot 100% rule out it having ended in May

    the difference can be having, at thing very moment, enough corrective waves for a complete correction or not

    It seems like we get into this situation quite often in this liquidity driven world of hopes and guesses and nothing more :-)

    meanwhile, I am not sure why so many forget the fact that ECB has so far been tons of talk for every gram of action. They will talk and talk and talk and ….

  17. blubrd67 says:

    “The sentiment index that is perhaps exhibiting the most excessive level of pessimism right now is the Hulbert Nasdaq Newsletter Sentiment Index (HNNSI),
    This is the most sensitive barometer …
    As of the end of this past week, this average stood at minus 47.1%, which means that the average Nasdaq-oriented market timer was allocating nearly half his portfolio to shorting the market. That’s an especially aggressive bet that the stock market will continue declining — providing the contrarian with an extreme position to go contrary to.”
    http://www.marketwatch.com/story/correction-close-to-being-over-2012-06-05?link=MW_popular

  18. piazzi says:

    As showed yesterday, index was in an area framed by a line study around 200-day SMA

    what better way to cream the shorts? Make them chase after a bounce off some widely followed market like 200-day

    good trade!

  19. budfox9450 says:

    well we tagged the OEW seing point 1300, VIX is though still at 23+ (really to high, but
    trend is short term down. BoYu indciator using the 9:43 am data – confirmed a Buy
    signal – note this is normally and end of day indicator, MACD turned bullish at the
    9:43 am check point – so we have 3 signals all positive, just see the 23 vix still alowing selling
    pressure…patience?

    Bud

  20. rc1269 says:

    hearing of potential US bank downgrades after the close today. the big ones (a couple to several notches apiece). that could get us moving. lower.

  21. rc1269 says:

    officially through the 1291 pivot now…

  22. blubrd67 says:

    Tony, can you believe that totally unexpected dream I had about silver breaking out seems to be happening. It seems there is something about that Higher Self you mention after all. :) Maybe I should start a new service Free Dreams and Visions Trading Platform. :) Free, based on your inspiration, of course.

  23. rc1269 says:

    What data are the ECB “watching,” exactly? the DAX is off 17% in 3 months, IBEX is down 51% since Dec 09.

    • tony caldaro says:

      RC, What’s this three month LTRO to last until the end of 2012?Thought LTRO 2 was over.

      • rc1269 says:

        the 3-mo program is different. it’s an ‘MTRO’ – medium term. the LTROs were just that – longer term, eg 3-years. no more LTRO, for now at least. but they will continue to offer unlimited 3-mo funding.
        according to bloomgerg: “Asked about the prospect of a third longer-term refinancing
        operation, or LTRO, Draghi said that ‘I don’t think it would be right for the ECB to fill other institutions’ lack of action.’”

        and who’s going to fill the ECB’s lack of action, i wonder…?

      • tony caldaro says:

        Helicopter Ben?thanks

      • Lee X says:

        Hey RC
        My guess is
        Damien Thorne

      • tony caldaro says:

        hahaha … probably a poltician with a different name by now =)

  24. Lee X says:

    :) u guys have a good day

  25. rc1269 says:

    Lots of Draghi headlines pouring out. ECB “stands ready to act,” …” is watching data closely.” how about instead of standing, just ACT.

    Lockhart also saying op twist extension is on the table

  26. Tony,if my understanding is right this is a reversal of the March 27,2012 pattern when both transports and dow did not make new highs.
    I would expect up for 2 days followed by down for 2 days,followed by a huge 100+ point rally.
    I think thats Mike call too.

  27. My wave 5 low pivots have been 1254 and 1269 at my TMTF service since last week. We hit 1267 pretty close. 1303 is the key pivot to climb over for me now. It looks like we finished 5 full waves down from 1422, and now an ABC Rally is on us for Wave B…. just my view.

  28. maks12 says:

    Instead of being in a C whats the probability of an A wave completing and we are in the B wave

  29. 5wavemodel says:

    Although today’s rally was somewhat muted, I believe it was productive. I was looking for wave 3 from 1267 to end either at 1285, or 1294. Although we hit 1285, and pulled back substantially from there, it looked like only 3 waves. At the moment, 1294 seems the most likely wave 3 termination point. This would project wave 5 somewhere in the neighborhood of 1320.
    A move above 1290 would most likely confirm this scenario. If 1285 was wave 3, we would be near the wave 5 top. Moving below 1278 would confirm this, and most likely lead to one more lower low.

    Steve
    http://5wavemodel.blogspot.com/

  30. rc1269 says:

    Thanks for the post Tony. Quick question, what if we go above the 1291 pivot…?

    Hey, a guy can dream right?! :)

    thx, as always

  31. H D says:

    “There’s a little, black spot on the sun today.”

  32. H D says:

    Hey Erkall, Greetings from Earth. We are a friendly species. I don’t mind feeding trolls once. I think you underestimate our ability to change gears and our emergency preparedness. Let me reassure you though! http://flic.kr/p/bUxGot :mrgreen:

    Hey – why not short the 1291 Pivot :shock:

    • CB says:

      nooo, ur not driving around like that, HD!!…lol…in a CCW state that’s quite a….hmmm.. fashion statement..what do you call it “my little ballistic weapon buddy”…?

      and ur Venus pic is just spectacular – did you or one of ur friends shoot it…it’s really sopmething HD..thanks for showing us

  33. alexhartley1 says:

    I would think there’s a good chance the short-term bottom could come next Tuesday Tony in line with the Bradley Turn Indicator on 12/6. We could then look for a potential rally into Late July/early August where we reach the Major Turn point of the year (another Bradley). I have no idea yet if it will be a top but it’s my preferred view for now. Cheers.

  34. scatman12 says:

    Erka
    perhaps you need to visit a psychologist to get yourself checked. You should probably vent this frustration somewhere else!

    On a different note what trading method do you follow and will you please let us know your success rate. We could all perhaps make more money thanks to “Erka Trading Platform”

    Also in future, if you don’t like EW, you should stop visiting this site.

  35. Brent Calis says:

    “Perhaps the muslim world will start concentrating more about the wellbeing of their own population and start building roads, bridges, hospitals, schools, universities, agro industrial complexes, railroads and airports instead of wasting their time and efforts trying to find ways to destroy our western values.”

    Erka11,

    Perhaps you won’t make another ignorant comment about the muslim world. My background is muslim…I don’t practice any religion, but I’m offended by your comments. How ill-informed some people are. Some of those countries have a better education than what is provided here in North America. I would also like an explanation on how “your” western values are being destroyed. Isn’t it the Eastern practices/values that have gone to the crapper because of western ones. They’re just trying to preserve what they have left. Not every muslim is a sexist/radical/terrorist. Their values were, in the first place, extremely well placed and sustainable.

    • Erka11 says:

      I know this debate is way off subject for this blog and I apologize in advance but I can’t let Brent’s comment remain unanswered.

      Your comments as so off line that they aren’t even worthy of a response but I can’t resist.

      You are offended, that makes two of us.

      I am appalled that in all our democracies there isn’t a permanent mass demonstration in front of government buildings and Arab countries embassies involving thousands of so called “moderate” or non-practicing muslims, such as yourself, to denounce what is happening in Egypt, Tunisia, Somalia, Soudan, Yemen, Saudi Arabia, and of course Syria.

      I am appalled that the so called “moderate” or non-practicing muslims, to the exception of a few courageous ones, are still trying to convince the rest of the world that Islam is a religion of peace, yet practically all the current conflicts being fought in the world have at least one islamic component.

      Perhaps if the “moderate” muslims were more forceful in their attack against fundamentalism, against bigotry, against the way women are disrespected and often mutilated, against the lack of acceptance of other religions, to name just a few basic tenets of muslim culture, the western world would have a different outlook.

      However, as you aptly demonstrated: “Isn’t it the Eastern practices/values that have gone to the crapper because of western ones”, even “moderate” or non-practicing muslims, such as yourself, keep blaming the West for what is happening to them. The situation is therefore hopeless as you can easily imagine what others, less enlightened than you moderate ones, usually born and bred in the western world, must think !

      As far as your comment on how our western values are being destroyed, I believe you were joking when you asked the question ;) and if you were not, I don’t have enough room on this blog to list the many examples that would illustrate this very obvious point.

      • tony caldaro says:

        Hi Erkall, I read the beginning of your post and stopped there.This is not a forum to debate anything other than the stock market and financial markets.If either of you wish to continue to this discussion, please do so privately.I might add, while all of us have some differences we are still all humans (currently) and all sharing a similar experience.Let us just share it together by recognizing our commonalities while we are one species.Rather than emphasizing our ever so slight differences. Namaste

      • Brent Calis says:

        Wow. You are a complete and utter ass. I hope your arrogance serves you well in your life. You and what you represent is the definition of what “racism” stands for. Your arguments completely biased. Stop coming here and being a complete dick. This site is a place to share ideas…not to try and belittle others.

      • Brent Calis says:

        Also,

        I am an atheist. I would, however, try to present the positive in any case such as this one where someone goes so far in one direction with their view.

        You seriously need a psychologist or something. I pray for the world that the negativity that you stand for is not infectious.

      • Erka11 says:

        An atheist who prays …. I knew you were a weirdo ;)

  36. IMO market sectors acted better today. Still some mixed signals hopefully indicating a change in trend.

    http://marketsectormodel.blogspot.com/

  37. optiontimer says:

    I took a 25% long QQQ position today filled at $61.15. Like Tony I too am expecting a lower low to be THE low; but last time I waited for that lower low the market went ripping to the upside without me and I had to settle for a smaller trading position than I’d have liked.

  38. http://chart.ly/ywidsut That is my chart from last Friday, still can see 1254 coming yet

  39. Disagree on the ZIG ZAG from 1415 count

    to me this looks like 5 clear waves from 1422…. even the Wave 2 up from 1358 looks like an ABC wave 2 up…. then a big 3 down, wave 4 up wedge, now 5 down

    SO Im getting more of a classic 5 wave decline starting at 1422… which has different implications than an ABC Zig Zag from 1415 ….

    and that is why E waves are fun, everyone can look at same pattern and see two different things

  40. Lee X says:

    Question .
    Will the results of the recall vote in lovely scenic Wisconsin have any effects in over nite trade ?
    Fun Facts # Wisconsin State Law made it illegal to serve apple pie in public restaurants without cheese.

    • CB says:

      lol! thanks Lee. that’s funny and crazy…how can they be pushing their dairy industry like that…maybe lactose-intolerant people should sue…anyways winter is too cold in WI, summer is too humid, proprety taxes are too high…fugetaboutit

  41. 5wavemodel says:

    Hi everyone.
    I feel the need to apologize for one of my posts yesterday. I feel privileged to be able to express my ideas here, and welcome the feedback I have gotten. Yesterday I abused that privilege, coming across as being a self-centered braggart. That is not how I want to be perceived. Ultimately it is not I, but all of you, who will determine whether or not my method has merit. Please accept my sincere apology. And a personal apology to Tony, whose own work is second to none, and who has the patience for the rest of us.

    Thank You,
    Steve

  42. M1 says:

    Tony, either way the market unfolds the rest of the week, I want to thank you for all you do for us….it wouldn’t have been possible for me to just trying to make any alt count without your support.
    Thanks again.

  43. CB says:

    Thanks Tony. Thanks guys. Enjoy ur afternoon everyone!

    1289.59=38.2% from 52 wk high

  44. piazzi says:

    Just a simple line study

    Notice how the lines are forming an area of interest around 200-day SMA

    http://markettime.blogspot.ca/2012/06/s-500-june-05-2012.html

    On a separate note, I find it interesting that there are now some gold miners that pay more than 1.5% in dividend

  45. I also prefer to go with Mike’s scenario of a retest, although I am not sure we will break the 1267.
    -The McClellan turned up today, thus preserving the divergence !!!
    -We got a bullish engulfing pattern on SPY and closed near the high’s
    I would thus expect we either made the low (Tony’s version) or are getting close (Mike).
    However, I don’t believe we are in a bull market. This thing went too deep.

    • budfox9450 says:

      TAC – Given that view – from the April 2012 SP high, we
      are nearing a 5 wave decline – therefore – even in a Bear
      market – would should expect to see a pretty good bounce,
      aka W2 up – in your view. I too, have work that is not
      especially Bullish until after Nov 2012….but that too,
      is not confirmed….

    • radrian6 says:

      Interesting, Tactical … I’ve been having similar thoughts about the RUT. The RUT peaked near 848 and formed an H&S top with a neckline near 784. On a daily chart, you can count five waves down to the recent low near 730 and, like the SPY, today’s session printed a bullish engulfing candle.

      I can’t rule out Tony’s scenario of a Major W2 but I agree with you that we may be in bear market. The coming rally will clarify the situation — if we’re bearish, RUT will likely stall before it can recapture the 784 neckline.

  46. budfox9450 says:

    Tony – agree with Mike – “good game plan” thanks.
    Guess, it would not hurt of the ECB folks had something
    positive to say on Thursday…it might provide the spark.
    Although, ending Major W2 down, is just fine, too…

  47. vorfahrt says:

    I wonder when / if ever we get something from Europe to resolve their debt crisis?

  48. Lee X says:

    Thanks Tony !

  49. mike7x says:

    Thx Tony! Game Plan, rest of week: Rally to ~1300; Decline to ~1265; New Uptrend begins ending ~ SPX 1499 around 8/1/12. (That’s all I ask.)

    • Erka11 says:

      So around the low sub 1265 in a few days Major 2 will end and the market will embark on a Major 3rd of Primary 3rd wave up, one of the most powerful combination under EW theory.
      I hope this time I am not offending anybody if I just state the obvious by saying that Waves being the reflection of mass psychology, it will take quite a shift in sentiment to ignite such powerful forces.
      So perhaps in the next few days Merkel will be touched by divine grace and encourage Mario Draghi to pour trillions of EUR into Greece, Spain, Italy, Ireland, Portugal and France. Perhaps all of these countries will suddenly discover the merits of fiscal austerity, perhaps they will also abandon 40 years of ruinous social policies as the great workers of the old continent will finally agree to work 50 hours weeks and retire at 68 year old.
      Perhaps US unemployment will drop from 8.2% to 5% in a few weeks as the great worldwide economic boom finds a new life and China put in place the mother of all QE programs, dwarfing the FED and the ECB put together, thereby triggering a 3rd of 3rd in commodities.
      Perhaps the Iranians will dismantle their military nuclear program and hire Israeli companies and advisers to put their country back in shape. Perhaps the Saudis in their great love for our secular democracies will accept to lower the price of oil back to the low 20′s to guarantee that the upcoming 3rd of a 3rd becomes a memorable experience.
      Perhaps the muslim world will start concentrating more about the wellbeing of their own population and start building roads, bridges, hospitals, schools, universities, agro industrial complexes, railroads and airports instead of wasting their time and efforts trying to find ways to destroy our western values.
      Perhaps also wars will stop and the world will be a better place.
      If this is your preferred count, then by all means keep dreaming … and good luck, I can only wish you are right !

      • tony caldaro says:

        perhaps, thanks Erkall

      • optiontimer says:

        … I learned a long time ago that all you need for a ripping good bull swing is an abundance of overly pessimistic short sellers who continue to sell on a scale up only to become truly inspired buyers as the bull raises its horns …

        Short sellers only think they are sellers … they are only buyers in waiting!

      • Lee X says:

        Hope for the best prepare for the worst
        Fun Facts# Merkel will say yes to anything if u give her a good foot rub.

      • Rocky Balboa says:

        Perhaps.. U will do something better with ur life than trolling on this blog!
        Perhaps.. U will learn to respect Tony, who asked nothing in return for his gr8 service,
        Perhaps…U will learn humility and self esteem and apologize for being such a Cheney!!
        PERHAPS………

      • rj2212 says:

        It’s called life, Erka. If you’re looking for perfection in the world, then I suggest you read a good book tonight. When a hospitable person welcomes you into their home, please refrain from raiding the fridge. Gotta love the internet. God bless, brother.

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