SHORT TERM: new uptrend high, DOW +35
Overnight the Asian markets markets rose 1.0%. European markets opened higher and gained 0.8%. US index futures were higher overnight, and at 8:30 weekly Jobless claims were reported higher: 386K vs 350K. The market opened higher at SPX 1375, then hit 1378 in the first few minutes. The SPX had closed at 1373 yesterday. At 10:00 the Philly FED was reported lower: -12.9 vs -16.6, Existing home sales were lower: 4.37 mln vs 4.55 mln, and Leading indicators have turned negative: -0.3% vs +0.3%. The market pulled back after the news to SPX 1371 and then started to rally. Just after 10:00 the FED released this: http://www.federalreserve.gov/newsevents/press/bcreg/20120719a.htm. The rally continued until 12:30 when the SPX hit a new uptrend high at 1380. Then the market pulled back again. Around 2:00 the SPX hit 1372, then bounced into a 1377 close.
For the day the SPX/DOW were +0.25%, and the NDX/NAZ were +0.95%. Bonds lost 8 ticks, Crude rallied $2.50, Gold added $4, and the USD was lower. Support for the SPX remains at the 1372 and 1363 pivots, with resistance at the 1386 and 1440 pivots. Short term momentum was quite overbought again before heading back to neutral. Tomorrow is Options expiration friday.
The market opened higher today and eventually made a new uptrend high at SPX 1380. The OEW 1386 pivot range has now become resistance, replacing the previous uptrend resistance at the 1372 pivot range. Once the 1386 pivot is cleared the market should then rally to the next resistance pivot at 1440. This should take some time as there is overhead resistance in the SPX 1402/1403 range, the 1413/15 range, and 1422.
The SOX index continued higher today and has met the expected upside requirements for a potential two year cycle low this past tuesday. Tech stocks should continue to drive this uptrend. If we are early with the SOX cycle low call, the market could selloff to the OEW 1313 pivot again. Therefore, it remains important to monitor the upside progress in the SOX index as this general market uptrend unfolds.
Short term support remains at the 1372 and 1363 pivots, with resistance at the 1386 pivot and SPX 1402/03. Short term momentum declined to neutral after getting quite overbought. The short term OEW charts remains positive from just under SPX 1350 with the swing point now just under 1360. Best to your trading!
MEDIUM TERM: uptrend hits new highs
LONG TERM: bull market
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Dow Jones going to comply with technical objective of the double top
We have an online translator on the blog and the analysis of the chart on the link below
http://www.partnerinvestimentos.blogspot.com
Downturn confirmed.Range 1315- 1373 in play.Choppy uptrend finishes for now.
Tony, is that a triple negative divergence on the SPX daily RSI…?
Looks like it
bot rally at prior resistance 1362…?
My chart of the day TCB.
http://chartoftheday1.blogspot.com/2012/07/71912-chart-of-day-tcf-financial-tcb_6274.html
To understand this market-one just has to just focus on the word ‘Choppy uptrend’
Any time you have a doubt refer to this word.I will post when I think this scenario loses significance.
BTFD not going any liwer than 1365,1400 next week
Cmon 1363 hold up
Congratulations, David !!!
It looks like your last week forecast may be unfolding.. “There is a major cycle 17-19th window coming up next week, and if we rally into that, in a wave 2…. it could set up a nasty 3 down…”
You all have a great day
As mentioned yesterday,
“S&P is in the timing band for a short-term or trading cycle low
1380-1390 area will give the appearance of balanced abc-x-abc pattern up that may start the move into the trading cycle low within the timing band”
Not a bad trade.
Did we see the top of trading cycle? Is this a move into trading cycle low (if not more)?
Who knows? There are probabilities and there is trade management and making sure one does not turn a winning trade into a loss
Spain bonds hitting new yield high this morning. Spanish and Italian equities getting hammered
Didn’t they approve the refinancing?
well, they approved the $100bn aid package targeted at Spanish banks. it’s good for the banks and ultimately that economy from a structural stability standpoint, but in a way i think that leaves the sovereign situation still hanging out there. bailout for banks means no bailout for spain sovereign. at least not yet. and now they have regions like Valencia potentially about to default without the support of the Spanish central gov’t. just a lot of pressure on the sovereign from all angles
Understood, thanksNotice the three towns in Callie that recently defaulted?
Callie or California
California
sure did! i wonder if we’ll see both Valencia, Spain and Valencia, California default… hah
Would not surprise.Best way to clear the slate is default.
Dow Jones broke a possible OCO (shoulder head shoulder), but set up a possible double top that could probably start or unconfigure from today. If the dow could isolate the top test case meets 13.127k 12.565k test may come.
dear friends, you find the link below to analyze the dow and the blog page you can use online translator.
http://www.partnerinvestimentos.blogspot.com.br/
I’ve been gone for awhile so just trying to catch up on some of your work. Tremendous analysis on the weekly updates, Tony. I particularly enjoy the Fed Liquidity one. That was a great read.
Hi…Tony,
The negative divergences in the monthly charts have not been highlighted. Are there any reasons to it?
Ilango, Since it’s long term it is quite normal to see divergences as a bull market unfolds.
If my count is correct, wave 5 from 1267 should terminate between 1383-1397, and most likely between 1383-1384. It is still possible that this is wave 3, and if so I would expect a slightly higher top, most likely between 1390-1391. Support is at 1367, 1357-1358, and 1333-1336. Resistance is 1383-1384, 1390-1391, and 1426.
Thanks,
Steve
http://5wavemodel.blogspot.com/2012/07/thursdays-market-071912.html
Thanks, Steve.
The next couple of trading days may cause vertigo.
Do not adjust your screens. This is only a test.
On a happy note, the Bots will be dizzy too!
I think we are about there on selling yield too for growth. Tony, what do ya think?
Best
bob
Heavily invested sector Bob, possible.
SORRY GUYS, I AM STILL BEARISH …MEDIUM AND LONG TERM BEARISH.
AS I SAID, I’LL GIVE THE MARKET TWO WEEKS TO SHOW ME I AM WRONG.
GL
Muchas Gracias, Tony!
If I were bearish (and I’m not) I would be looking for an $SPX cash high tomorrow of 1386.46 followed by a reversal that closes below today’s low. I’m not bearish, but I’m willing to entertain the possibility that we are about to see at least a short term pullback, if not a retest of some significant lower level (1309, 1267). Regardless of the mildness or severity of the next pullback, I agree with Tony that for the next rally, tech will be the place to be.
That is something I could get behind.
Even if SOX rips, I wouldn’t hold on to it long. During last rips since the tech bubble burst, it always ended up under-performing.
Its just the first of the cyclicals to pop, since we (I design chips professionally) are as far up the supply chain as you can be.
My target for $SOX is 512 to 560. A 50% increase (which Tony said is typical) from its assumed cycle low at 345 would put it at 518. As long as it is going in the right direction, I am fine to hold it for the 6-12 months it might take for my SOXL shares to hit $50 – $80 share depending upon tracking errors and such … and there is always the Q’s
I don’t know. The wave volume shows continues decline, which seems to indicate that my B-wave triangle count might be correct. Today could have been the top of Wave E. We could still overshoot the wedge on a final push, but the upside bet is becoming risky.
I reduced long positions and hedged today. Should we break out, I will lose 20 points and can re-enter, but the downside is HUGE.
Here is the bearish count:
http://tacticalstrategist.com/2012/07/19/potential-e-wave-completion-update-2012-07-19/
Thanks Tac. I like it.
I appreciate the feedback!
The real reason the market keeps rallying.
lol…HD!!! right, who doesn’t like the politics of personal destruction and character assasination, huh? but seriously I don’t think Romney would, for instance, impose a trader’s tax like that Obama guy might …so….it’s a choice…
me too HD, and I should have inserted this
in my post cause ur vid was really funny and has a ton of great sound bites…thanks!! … oh, and I am all for not privatizing the lakes & golf courses you go to, so that you can get ur R&R at a reasonable price and won’t have to charge us ur ‘usual fees.’ 
Ditto….Bud
thanks Tony!
1377ish C=A with, some neg D on 60 min (?)…
1390′s I thought
thanks Tony. yes. def. on the daily like you[ve said …but ever since Bloomberg started talking about that number (1390) this AM
, and we since we did get a bunch of neg. Ds intraday I narrowed down my vision to 1325-1357-1345..so I’ve soId my long EOD…hope we get a little dip before the next leg up
GOOG didnt miss??
estimates?
yes, estimates. EPS of 10.12 vs est of 10.16. but pretty irrelevant in this market i think. MSFT posted a loss and its up 2% AH.
i’ve been listening to a lot of the earnings calls this season and the market is really reacting the polar opposite to the tone being set by corporate management. the general trend so far is that things are getting worse. not that things are bad and stable, but accelerating to the downside.
the outlook from corporate management during all of the other new uptrends in recents years was one of “less bad.” sure, things were weak or soft, but they were getting a little less bad, if not better. here we have the opposite. the commentary right now more resembles what i used to hear in mid to late 2007.
i know this is a technical analysis site, but i for one do like to usually see the technicals be modestly consistent with the story i get from corporate management.
thx RC
According to Reuters est were 10.02 and google beat that……….
Sorry, Reuters con est for google was 10.04 which was beat…….
thx pas. estimates are a little variable depending on which aggregation service you use . i use bloomberg, which is 37 analysts and $10.16. but to my prior point, give or take 50 cents i don’t think it would have mattered much. considering that just two weeks ago consensus was $11 and the stock is up since then would you still call it a beat? objectively speaking companies are not beating. estimates have tanked the last few weeks while stocks have risen, so anybody who doesn’t handily beat for all practical purposes probably missed. the fact that company are actually still missing is fairly appalling.
RC, maybe you thinking about it too much.
Personally, I think US stocks are expensive, however there are not many, if any, alternatives in a ‘risk on’ trade.
So it appears everything is OK for now if results are not below (already lowered & lowered & lowered) estimates.
Though, maybe in a year or so, if SPX is at, say, 1575, then in line might not be good enough anymore.
GOOG misses, shares up. Just another potential tech-bottom data point…
thanks for the post Tony. strange market to me right now. it’s acting as it normally does when we’re coming off a really depressed level, where prices and expectations were excessively low. but since neither of those circumstances are currently the case, i’m a little perplexed by the resiliance and strength in the face of incremental bad data.
RC, Financials down over 1% today, and the Techs rise nearly 1%.Sell cyclicals, buy growth
what is considered a cyclical? financials? metals/commod?
Financials, industrials, commodities … anything that swings big with the economic cycle. Just making an observation.