wednesday update

SHORT TERM: volatility continues, stocks surge DOW +247
Stocks gapped up today at the opening as a European rally sent the stock index futures higher. At the open the SPX quickly rallied to 1444, then pulled back to 1438 by 10:30. Finding support at that long term pivot another rally carried the SPX to 1450 by noon, spurred by buying in the tech sector. Another pullback to 1442 by 2:00 ignited a rally into the close, as the SPX and the general market recouped nearly all of yesterday’s decline. At the close the SPX/DOW were +2.05%, and the NDX/NAZ rose +2.70%. Bonds reversed an earlier rally to close 1/4 point lower, Crude rallied $1.70, Gold was $2.50 higher, and the Euro was higher as well. This morning we mentioned that if SPX 1438 held a rally to the next pivot of 1462 was possible. It did hold and the market did rally to the long term 1462 pivot, all in one day. With a SPX close of 1464, 1462 is now again support with 1438 next. Resistance is now 1484 and then 1506. Short term momentum is again overbought, after being extremely oversold at yesterday’s close. The wild ride in this market for the past few months continues. Best to your evening!
MEDIUM TERM: correction
LONG TERM: bullish.  

About tony caldaro

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9 Responses to wednesday update

  1. tony says:

    Hi Shaun,
    That scenario has the highest probablility.


  2. tony says:

    Hi Joe,
    Not exactly.
    First the market needs to get there, and then hold.
    Not certain either of those two will occur.
    We\’ve been following INTC and may post the charts, not CSCO.
    Neither stock looks all that encouraging actually.


  3. tony says:

    Not quite sure what you mean, 5 waves down on the hourlys?
    Still looking for SPX 1364. 


  4. tony says:

    Hi Frank,
    Gold is no longer a hedge against monetary inflation.
    If it was it would be at $2,000 by now.
    It\’s more of an alternative investment in a worldwide economy.
    There are several financial instruments to hedge against inflation.


  5. shaun says:

     Tony, First thanks again for your great blog.    How confident are you that the market (SPX/Dow) is going to retest the lows before going on to new highs for wave 5?   Thanks


  6. Prakash says:

    Hi Tony,Sorry for the second post – Have you considered covering INTC or CSCO with EW – they seem to be setting up quite nicely to make a run to multi-year highs and showing some strength. Thanks,Joe


  7. Prakash says:

    Hi Tony,With S&P closing decisively above 1462, next resistance is previous high and then in mid 1480\’s. If the index were to get to 1485, that would be a higher high in the index, with most recent low being in 1432. Wouldnt that signal a new uptrend and create a very difficult scenario for the index to undercut 1430 and test the 1370 levels again? Thanks,joe


  8. Unknown says:

    We have just passed the wave 5 I think. How low will this go?


  9. Frank says:

    Hi Tony,
    Also, if the is going to start the last powerful leg of primary wave 5, the major fuel would also be FED pumping more liquidity into the system (Greenspan all over again?), then wouldn\’t gold also shoot up?  More paper money=more inflation = higher gold price? 


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