monday update

Posted on July 2, 2012 by

SHORT TERM: consolidation day, DOW -9

Overnight the Asian markets gained 0.7%. European markets opened higher and gained 1.3%. US index futures were higher overnight, and the market opened slightly higher at SPX 1363. The SPX had closed at 1362 on friday. In the opening minutes the SPX dipped to 1361, rallied to 1366 – a new rally high, then began to pullback. At 10:00 Construction spending was reported higher: +0.9% vs +0.3%, but ISM manufacturing was reported in contraction mode: 49.7 vs 53.5. The market continued its pullback until about 11:00 when the SPX hit 1356, and then tried to rally. Heading into the close the SPX made it back to 1366 and closed there.

For the day the SPX/DOW were mixed, and the NDX/NAZ were +0.45%. Bonds gained 18 ticks, Crude slid $1.25, Gold was off $1, and the USD was higher. Support for the SPX rises at 1363 and 1313, with resistance now at 1372 and 1386. Short term momentum declined slightly from extremely overbought. Tomorrow, Factory orders at 10:00 then monthly Auto sales.

The market opened higher today, and made a new rally high at SPX 1366, before pulling back a moderate 10 points to SPX 1356. After that the market started to work its way back to the opening levels. The market is now at the highest level it has been since early June and is uptrending. SPX 1499 by year end? We shall see. A preliminary review of the worldwide indices now displays at least 65% in confirmed uptrends, and likely more after all the numbers are in. Considering there were no indices in confirmed uptrends just a week ago. The WROC buy signal, from two weeks before that, appears to be spot on again.

Short term support is now at the 1363 pivot, then SPX 1342/47. Overhead resistance would be at the 1372 and 1386 pivots. Short term momentum is remaining overbought. The short term OEW charts remain positive from under SPX 1330 with the swing point now at 1340. Best to your trading in this holiday week!

MEDIUM TERM: uptrending

LONG TERM: bull market

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

About tony caldaro

Investor
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74 Responses to monday update

  1. Lee X says:
    July 3, 2012 at 12:06 pm

    Uhh everybody knows were closing early ..right ?

  2. liborval says:
    July 3, 2012 at 11:37 am

    Hi Tony, can the market go up without QE3 and will the FED start the QE with the market so high?

  4. vishal409 says:
    July 3, 2012 at 11:22 am

    Lee buddy whats up, CL’s had a great fall?

  5. liborval says:
    July 3, 2012 at 11:20 am

    hi tony, do you think we can go up without QE3 and will the FED start QE with the market so high?

  6. H D says:
    July 3, 2012 at 10:24 am

    Range 1,363.53 – 1,373.79 KISS

    In UVXY Not sure about the voodoo appeal of those etf’s. We will see.

  7. Lee X says:
    July 3, 2012 at 10:18 am

    Those silly Iranians

  8. rc1269 says:
    July 3, 2012 at 9:35 am

    unrelenting rally looking pretty wave 3-ish to me so far

  9. M1 says:
    July 3, 2012 at 9:28 am

    My stop at 12933 is abt to be hit =(
    GL

  10. David Banister (@activetrading) says:
    July 2, 2012 at 11:11 pm

    Had 1375-77 as possible still leading into last weeks trading, so this still doesnt seem right given the obvious 3 wave rally from 1267-1363 pivots. Then a drop to 1309 B wave support, and now a rally back to the C wave high of 1363 plus a few.

    To me the count from 1267-1363 cant be labeled as wave 1 because there are not clear 5 waves up… only a clear ABC

    So best projection is ABC- A ABC B- and now we are in ABC- C…. 1375-77/89 ranges.

    But I dont see the impulsive 5 waves from 1267, thats all..

    best to all, we will see

  11. 5wavemodel says:
    July 2, 2012 at 10:54 pm

    It looks like 1365 was wave 3 from 1307. I then see a 5 wave sequence from 1356 to 1365. This means we should see a pullback tomorrow. If the market holds above 1356, we could see a move to 1368, a pullback, and then a slightly higher high. The market would then move lower from that point. If we get above those levels, my target is 1374-1382, with the uptrend continuing.

    If the market breaks 1356, support is at 1345,1338, 1326-1323, and then 1313.

    Thanks,
    Steve
    http://5wavemodel.blogspot.com/2012/07/mondays-market-070212.html

  12. graph1159 says:
    July 2, 2012 at 8:22 pm

    Given the June-July 2011 rally that looked indistinguishable from a new uptrend, I guess I am feeling a bit of deja vu right now. The economic circumstances don’t seem much different from a year ago. The bullish arguments make sense, but since there is a lot of economic trouble here and overseas, I am staying bearish unless we take out the April highs.

    Have a good week,
    Samuel

  14. M1 says:
    July 2, 2012 at 8:02 pm

    Thanks Tony, I am still 150% short…my stop is at the same level than friday….but now that we have the uptrend confirmation it may be a matter of time before it gets hit. We shall see
    One question: once we get an uptrend confirmation, we are suppose to be dealing with major waves, right ?…this must be major 3 if we go up OR major b or major 2 if it roll over. correct ?
    Thanks again.

    • tony caldaro says:
      July 2, 2012 at 8:42 pm

      Mario, The degree of the wave is not relevent.The fact that we are in a confirmed uptrend now is.Since the beginning looked sloppy it could be a B wave.But since the US has lots of company in this rise it is probably Major wave 3.

  15. Lee X says:
    July 2, 2012 at 7:05 pm

    Thanks Tony !
    Hey H D ! Do u take paypal ? ;>P
    Pre split 2 handles = 1k on a SPU…Oh the good ole days…Even morons like me could get lucky every now and then.

    Hey C B

    I play a lil geetar now and then ..maybe one day I’ll post some ” hot licks” here.

    • Lee X says:
      July 2, 2012 at 7:07 pm

      Get well TC

      • CB says:
        July 2, 2012 at 7:47 pm

        Bull market in TCs, huh?..lol…and thanks so much Lee…it ‘s really sweet of you to say that.. :) I am pretty concerned about him cuz he’s 12 yrs older than I am so his risk for epilepsy is pretty high they said. ..but it can be controlled by meds.

        Wow, you play the guitar, Lee?…that’s awesome!!! I kind of wondered about that after watching that nice video you posted last week, so I am happy I asked you. Oh my, it would be terrific if we could hear you play Lee!! And hey can you make sure to wear those cool bi-focals that you were talking about, you cool kid ? Thanks Lee! :)

  16. Scott C (@gplantrader) says:
    July 2, 2012 at 6:19 pm

    Thnak you – I understand why on the thesis now… Enjoy the rest of the week and have a nice 4th!

  17. Scott C (@gplantrader) says:
    July 2, 2012 at 5:45 pm

    Hi Mr. Caldaro,
    So you believe we are in a wave three here with the lows in? Does this show the needed volume, timing and follow thru you would expect with a wave 3?

    You mentioned Gold was turning bullish and in an uptrend but then also mentoned that commodities are in a bear market. If we are in fact putting in this last leg would it be safe to assume that copper, oil, and gold could move with the SPX in a bullish way for the short term and then continue it’s bear market? I made some bad mistakes in April around very large positions regarding FCX and GDX and then bought a bunch of X and ACI — It has been murder… add that TBT for the bonds crushing.

    Do you feel that GDX can get back into the 50s short term and FCX back into the low 40s and X into the mid twenties with an SPX move into 1499? I would think they would have to, correct?

    There is a count out there where we are still in wave B of 4 (A was 1266 spx low) with a C to continue to 1250 or flat. I guess that would bring the DOW back to 12000…

    May I ask what you are seeing which would make us in the great wave 3 mode where it is suppose to rip faces and take names :)

    I am sorry for writing so much — I way overextended myself long side on these stocks that I saw as good entries off of their previous price levels and it is when I found your bearish view on commodites that has had me for more concern.

    Thank you sir for your time.

    • tony caldaro says:
      July 2, 2012 at 6:10 pm

      Hi Scott, So you believe we are in a wave three here with the lows in? Does this show the needed volume, timing and follow thru you would expect with a wave 3? Not as yet, but the uptrend is still quite new. You mentioned Gold was turning bullish and in an uptrend but then also mentoned that commodities are in a bear market. If we are in fact putting in this last leg would it be safe to assume that copper, oil, and gold could move with the SPX in a bullish way for the short term and then continue it’s bear market? I made some bad mistakes in April around very large positions regarding FCX and GDX and then bought a bunch of X and ACI — It has been murder… add that TBT for the bonds crushing.Typically all ‘risk on’ investments rise somewhat together. Naturally, the bear market types should have lesser advances. Do you feel that GDX can get back into the 50s short term and FCX back into the low 40s and X into the mid twenties with an SPX move into 1499? I would think they would have to, correct?We do not give investment advice, but technically those levels look possible. There is a count out there where we are still in wave B of 4 (A was 1266 spx low) with a C to continue to 1250 or flat. I guess that would bring the DOW back to 12000… Alternate view, yes. May I ask what you are seeing which would make us in the great wave 3 mode where it is suppose to rip faces and take names :) 80% of the world’s markets are now uptrending. That’s quite a big shift in only a few days. Looks like a third.Lots of other asset classes and technicals confirming the same. I am sorry for writing so much — I way overextended myself long side on these stocks that I saw as good entries off of their previous price levels and it is when I found your bearish view on commodites that has had me for more concern.Good luck, and always use stops! Thank you sir for your time.

  18. Rob Naardin says:
    July 2, 2012 at 4:20 pm

    Tony

    Good day for the bulls.

    I’m guilty of the sin of blowing the count on the 5 minute spx chart.

    I’m new to intraday charts and I find all the flat trading and grinding confusing. When things are moving up and down nicely, I can figure it out.

    The drop after the ISM numbers came out caused the 5 min 20 ma to dip under the 50 ma a little. Same as the last wave 2 and 4 corrections in the old 5 min bull market. Same as it does on the daily chart. I’ll say it again. Same as it does on the daily chart!!!!!!!! At least in these last 2 secular bull markets. So SPX 5 min bull market is in wave 3.

  19. tacticalstrategy says:
    July 2, 2012 at 4:07 pm

    Have a nice holiday Tony. Thanks for the fantastic work. I don’t always agree, but that makes it all the more interesting to come here and study what you think. You have an amazing track record.
    Nevertheless, 1499 or 1199 that remains to be seen. The bias (or my bias ;) ) is still down. Don’t get me wrong, i would welcome 1499 as a fantastic selling opportunity, only I am not that optimistic ;)

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