wednesday morning

SHORT TERM: stocks gap down on a weak durable goods report
Overnight the Asian markets were mostly lower, and China’s SSEC posted another all time high. Europe came in 0.35% lower, and our stock index futures traded mostly lower overnight. At 8:30 durable goods orders were reported weaker than expected, and as a result, stocks gapped down at the open. After making an initial low in the first few minutes, the market waited until Bernanke’s speech was released at 10:30. FED chair Bernanke reported to congress: the FED was expecting slow growth, with moderating inflation, and the subprime mortgage problem has not overflowed into other areas of the economy. However, the main concern remains inflation! The market took that last comment as a sign of a potentially less accomodating FED, in regard to rates, and resumed selling off. At about 10:45 the market made a short term low as the SPX hit 1414, just a few point below the 1417 short term pivot point. Bonds rallied on the news now up over 1/4 point, Crude now testing resistance up $1.40, Gold is up $4.00, and the Euro is higher. Stocks are now sufficiently oversold short term, and on the daily charts, to confirm the end of Minor waves one and two. The short term EW pivot point at 1417 has held, thus far, and the market should now start some sort of rally. All three days this week have started with the market heading lower, as it pullbacks after the first impulse wave of this potentially new uptrend. A new uptrend has yet to be confirmed, but the technicals continue to look bullish. Best to your trading!
MEDIUM TERM: bullish
LONG TERM: bullish.     

About tony caldaro

Investor
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7 Responses to wednesday morning

  1. tony says:

    Hi … A wave C is still possible since there has not been an uptrend OEW confirmation yet.
     
    Hi Amit … How have you been? Yes the SPX closed right at 1417.
     
    Hi Frank … it looked like the market had bottomed, but the SPX failed to make much headway during the rally.
    So we still have today\’s downside gap to close before the market can head higher.
     
    Hi Adrian … the only counts I\’m seeing right now is as posted:
    A complete Intermediate wave four and we\’re in wave five, or wave four is still ongoing.
     
    Hi Roger … true Ben did not provide the market with any new encouraging words. The reason it continued lower.
    After the lows we did get a rally, but Apple (as you noticed) began to weaken and took the NDX with it.
    It\’s had a big run from $83 to $97 without much of a breather. Was due for a pullback.
    SPX 1404 may be tested, so far 1417 is holding fairly well.
     
    thanks guys
    tony
     
     
     
     
     
     
     

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  2. Anonymous says:

    Hi Tony:
     
    not trying to bearish here..just wondering if you think the entire recovery from 1364 low was a fake move..and if we are heading down..bernanke didn\’t give any encouraging words..he didn;t even give any indication of lowering interest rate for next quite a few months..what do you think of this? do you think we are  headed down to 1405? or new lows? would like your views..today the leader stocks like aapl,good broke down in the last 2 hours to, just to give you heads up..just my opinion..would like your  views. thanks
     
    Roger

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  3. adrian says:

    hi there,
     
    do you think that the volume on this rally up from 1380 is ok? shouldn\’t it be expanding? do you think it is possible we were riding a differnt wave? do you have an alternate count for the wave starting in 2003?
     
    thanks,
    best regards

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  4. Frank says:

    Well, so much for the ralley… after it broke through the 45 degree uptrend support line, it just kept going down…  Maybe SPX needs to do the same as gold test its 20SMA? Well, see how it close and what happen tomorrow, maybe it still have the chance, QQQQ short term support seems to be around 43.5.  Let\’s see if big boy markup market for month end/quarter end report card, seems market trying to head back up again now…
     

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  5. Frank says:

    Hi Tony,
     
    I believe you are correct.  SPY,QQQQ,DIA all showing positive divergence on 15/60 minute chart on this leg down.  Currently QQQQ (should be same for other index)  filling up the gap down and is development a short term up trend on 15 minutes chart (about 45 degree up), if it can break through the gap it should be good to go!  GLD really had some people fooled on the first try to break up.  But now it filled the initial "gap up", let\’s see if we can have a "real" break out!  Crude is forming a shooting star on the daily chart so far.  If by the end of day, it forms the shooting star, maybe it will start turning down and really give Stock market a boost?
     
    Frank
     
     

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  6. Amit says:

    Hello Sir.
    Its Amit here,looking at it objectively the S&P wud be closing at below your pivot 1417.
    Warm Regards.
    Amit.
     

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  7. Unknown says:

    Hi Tony,
     
    I read your blog regularly. Thanks for all your posts. Can I check if it is possible that we are still in Wave C of the 4th leg? Cheers!

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