SHORT TERM: market continues to drift, DOW -7
Overnight the Asian markets lost 0.2%. European markets opened lower and lost 0.6%. US index futures were lower overnight as well. At 8:30 the NY FED was reported back into contraction mode: -5.9 vs +7.4, and the CPI was reported flat 0.0% vs 0.0%. At 9:15 Industrial production was reported higher: +0.6% vs +0.4%, and Capacity utilization rose: 79.3 vs 78.9. The market opened lower at SPX 1402 but started to rally. At 10:00 the SPX hit 1407, and started to pullback, when the NAHB housing index was reported higher: 37 vs 35. Around 2:00 the SPX hit 1404 and tried to rally again. Around 3:00 the SPX hit 1408, then pulled back into at 1406 close.
For the day the SPX/DOW were mixed, and the NDX/NAZ were +0.35%. Bonds lost 19 ticks, Crude gained 75 cents, Gold rose $5, and the USD was higher. Medium term support for the SPX remains at the 1386 and 1372 pivots, with resistance at the 1440 and 1499 pivots. Short term momentum hovered around neutral for most of the day. Tomorrow, weekly Jobless claims at 8:30, along with Housing starts and Building permits. At 10:00 the Philly FED.
The market opened lower today, rallied a bit in the morning, and then went into a small trading range for the rest of the day. For the past 8 trading days the market has remained between SPX 1394 and 1410: just barely more than a 1% swing. We checked the weekly charts looking for a similar situation: a tight trading range and declining volume. And sure enough we found another period, such as this, during Major wave 3 of Primary I. That uptrend appeared to have stalled, while gradually creeping up, in December 2010. After the holidays ended the market took off to the upside. Labor Day is a bit more than two weeks away.
Short term support remains at SPX 1402/03 and the 1386 pivot, with resistance at SPX 1413/15 and 1422. Short term momentum ended the day at neutral. The short term OEW charts remain positive with the swing point now around SPX 1400. Best to your trading!
MEDIUM TERM: uptrend
LONG TERM: bull market
Tony what are your trading thoughts on platinum and /or the other white metals, when you have some time please. thanks.
CB,
One of our guys called that low yesterday.
PLAT has been downtrending since February.
Like Gold it had several tests of support in this case $1375.
This could kick off an uptrend to $1500+.
Silver has been in a choppy uptrend since June.
Nice, you guys are cool!!
Thanks Tony.
From the few replies I have received from Tony I gathered he isn’t particularly worried about the massive divergences forming between the major indices and other lesser ones. However, isn’t the divergence between Copper and SP worrisome for the bullish case ? Copper went from 450 to 338 since August 2011 when SP went from 1340 to 1415. More recently, last time SP was at 1417 in early April this year, Copper was at 390. And since the bottom of early June, SP is up 12% when Copper is up merely 4%.
Erka, Copper appears to be in a bear market along with the rest of the commodities.Not expecting it, or even the Transports to track the SPX.Big DOW Theory non-confirmation for those that believe this is still a manufacturing economy. > Date: Thu, 16 Aug 2012 18:48:55 +0000 > To: oewtony@msn.com >
Sometime in 2013 the Dow theorists will note that we have finally entered a confirmed bear market, and they will all claim that Dow Theory called it due to the non-confirmation of the Trannies … of course, that will be after missing the next 2500 Dow points.
I pray every night that God doesn’t allow me ever to be an early (or Perma-) bear.
Being a perma-anything is no way to invest in any market
on copper, (“like i said” recently – yes, you read that right Lee) i see what could be an IHS forming over the last month. left shoulder around 7/23-7/24 timeframe, right just completed 8/14-8/15 and now breaking back above. not sure that changes the long term count at all, but if ever there was a good chance for it to break out of the recent doldrums it’s looking promising.
Okay, if we get to 1420 already today should I be thinking exhaustion/capitulation…?
Somebody remind me the rally is still just starting and it’s not time to sell. I just hate when my trades work out too quick – I figure it must be too good to be true and cash out!
*1417 #gotime. GL all
HD, mind clarifying your double top comment? Are you looking for us to peak out here 1417? Does feel sort of blow-off top-y
I am counting 5=1
short term count i presume? longer term i have trouble shorting/selling until i see a negative divergence on daily RSI at this point. making new highs in price with new highs in RSI. so feel like there should be more to come before true exhaustion. just what i’m thinking this minute; reserve the right to totally waffle on that at any time.
You ever had chicken and waffles? man that is some good stuff. Put some hot sauce on the chicken. Crazy how some flavors work together. I’d go with a light beer on that one.
EW gives some points of interest but nothing is violated with 5 extending. BTW it feels terrible!!
mmm..that sounds finger licking good HD!
ASTRO Longitude Speed Sun…Mercury…Venus…
http://astrofibo.blogspot.ca/2012/08/astro-longitude-speed-sunvenus.html
DUDE! No mention of the uber bullish aspect Perseid Meteor shower? Huge miss in the astro world IMO.
can’t make this stuff up guys. Range 1,404.15 – 1,413.59 . 1417 5=1 If there is a double top trade I think they show up a little early. JMHO
HD, bouncing off of R2 again today > Date: Thu, 16 Aug 2012 16:33:51 +0000 > To: oewtony@msn.com >
http://www.marketwatch.com/story/jon-corzine-has-a-deal-for-you-2012-08-16
just absolutely unbelieveable > Date: Thu, 16 Aug 2012 16:02:45 +0000 > To: oewtony@msn.com >
that’s a good 1, Lee. I think he must’ve hired a PR firm, which told him it’s a good idea to spread rumors like that to underscore his innocence ahead of a potentila court action…who knows..he might just be able to BS a few potential jurors/public opinion in general with that…he’s saying …hey I am an innocent man…this is really, really good..
Tony, I just wanted to thank you again for all your efforts. The more I spend time reading and hearing the thoughts of others the more I appreciate your calm, collected and objective approach to the market. I feel like in crazy markets like we’ve had since March 09, the emotional trade has more often than not been the wrong one. The contrarian trade has been more valuable than ever, in my opinion. So many folks missed (and now resent) this entire bull market, and their angst only seems to continue to add fuel (shorts) to the rally they despise.
As a credit investor I am a generally/naturally bearish guy. Corporate bonds have little upside and tons of downside, so you don’t get paid to be optimistic in my biz. That’s why I value the opinion of (good) equity guys. And believe me, there aren’t many of them.
And just to be clear, I don’t consider you a permabull. I understand that’s just what your system gives you, and you go with it. I like that. And I’ve always disliked how folks like to label you a permabull when you’re just following a quantitative system. I distinctly recall being fairly long equities in July 2011, and being very grateful for the concern you started to express at the end of that month when things started going off plan. I think you saved me probably 10-14% or so worth of SPX points. A permabull would not have been able to help me there.
So, long story (not so) short, I think I can speak for most everyone here when I say your tireless work is enormously appreciated, and it will be a sad day for me whenever you stop doing it. I only hope that the small insights I can offer now and then from credit land can at least partially repay you for what I receive. Cheers!
-rc
+1
+1
+2!
Wouldn’t normally post a pick but along the lines of giving back – and do your own DD – have a look at IMRS. Time to get long big IMHO… double by year end likely and up from there…
Very gracious of you RC.Just doing my best to help as many as I can. > Date: Thu, 16 Aug 2012 15:18:59 +0000 > To: oewtony@msn.com >
SHLD – Sear’s just hit $60….
Very exciting news. Wheat is working for me again. http://flic.kr/p/cSRLNs Just closed the 840′s from Tuesday.
See if we get the cupnhandle.
kudos!
Am I hallucinating, or did I see a cup and a handle here?
maybe it’s your coffee cup
I’m healthy guy, I don’t drink coffee!
Hey, what a coincidence, just noticed I’m not the only one hallucinating
Two fools thinking the same, makes me feel better
http://www.marketwatch.com/story/stock-averages-in-bullish-pattern-2012-08-16?dist=lcountdown
guess he doesn’t drink coffee either
http://stocktwits.com/message/9133951
Thanks Igor! You always come in at the right time for a rescue!
Just sharing my opinion. Stay well!
German 10yr Bund: A relatively big “block trade” occurred earlier today. 9-days to “last-trading-day” for Sep contract and have not seen any rollover in December. I suspect a buy-the-dip from here. I’ve closed a third of my shorts.
http://screencast.com/t/TOxeeJbNfeq
good luck Magnus
SP500 Time Ratio 161.8…March 2009 – August 2012…
http://astrofibo.blogspot.ca/2012/08/sp500-time-ratio-1618-march-2009-august.html
Sure hope you’re wrong on this one…hate to see under SP 1000 in short order.
You have been calling a down market for days using everything from time ratios to longitude speed. Can you at least attempt to offer an explanation as to why your forecast doesn’t work ? Do you have some statistics to share on how often your astronomical observations have coincided with your forecast ? I know you don’t communicate much but it would be interesting to have some detail on the charts you post on a regular basis and on the conclusion you draw from these charts.
Party in Japan last night with the Nikkei +167 … somehow the rest of the world has yet to be invited!
folks are partying now. i guess it just too em a while to get in the groove. spain and italy are up 1.5% and 1.1%, resp. and why not?!
The action lately has certainly been choppy, and has stayed within a very narrow trading range, but I still see a bullish wave formation from 1395. I am looking for 1412, a slight pullback, and then 1420.
Thanks,
Steve
http://5wavemodel.blogspot.com/2012/08/wednesdays-market-081512.html
http://scharts.co/OgSHuE
=)
Not just Labor Day, Tony, but Ben speaking at the Jackson Hole Economic Forum on 8/31 and his pal Mario Draghi speaking at the same forum on the next day. Then, no US markets open on the following Monday. Gonna be Real Interesting.
Noticed that too John.
The friday/saturday CB combo, and we’re closed the following monday.
Could be quite interesting.
The element of surprise is one of the Bankers best weapons.
Tony, what are you expectations for Jackson Hole, if anything? I know you’ve said you don’t see QE in the cards this time around, yet you also are expecting bullish moves for the market likely to continue around that time. Just wondering what you see out of the Fed that might help the ball rolling.
IBEX and FTSE MIB (italy) look like they’re kicking off their next wave up. DAX prob not too far behind
The FED rumors are to sell Bonds and buy MBS, in another Twist operation.
The real surprise may be Draghi’s speech on saturday.
gotcha. thanks Tony. from my seat it certainly still feels like the pain trade is higher. guys are still shorting this rally at every turn, so feels like we’re very far from bearish capitulation.
Fascinating days, thanks for a comparison. Being at the upper end of a trading range with such low volume, I expect a healthy drop at any time, yet the charts keep climbing. Gold seems to be in a wandering state from all the financial flux. Any current thoughts, do currencies need to settle
before it gets a footing?
Gold.
Actually surprised it has held $1600.
Thanks Tony! Looking good. SOX (semis) continue to lead and CSCO had a pretty good ER after the close; raised their dividend (up AH).
kudos