monday update

SHORT TERM: market higher on Paulson’s financial blueprint, DOW +46
Overnight the Asian markets were mostly lower, with only the ASX bucking the trend by gaining a few points. Europe came in about -0.55%, and closed at -0.10%. Stocks opened mixed as the Chicago PMI was reported under 50 again, indicating continued manufacturing contraction in the midwest. By 10:00 the SPX rallied to 1322, and then retested support at 1316 by 11:00, while Treasury Secretary Paulson was reporting the administration’s broad scoping plan to overhaul the financial sector: Stocks rallied on the news. By 1:30 the SPX rallied to 1329, then pulled back top 1320 by 3:00, before bouncing around into the close. All in all, the SPX stayed within the 1316 and 1327 EW pivots all day. At the close the SPX/DOW were +0.50%, and the NDX/NAZ were +0.80%. Bonds gained about 1/4 point, Crude lost $3.90, Gold dropped $14.00, and the Euro was lower. Support for the SPX notches back up to 1316 and then 1287, with resistance at 1327 and then 1344. Short term momentum was oversold at today’s lows of SPX 1313, and was rising into the close. Tomorrow ISM manufacturing will be reported at 10:00, along with construction spending. Near term momentum did not get fully oversold at today’s lows. So there is still a possibly for another pullback into the 1316 pivot. Best to your trading!
MEDIUM TERM: rally from the SPX 1257 low still underway
LONG TERM: bear market

About tony caldaro

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18 Responses to monday update

  1. Forkoholic says:

    I put some orders to buy calls on 2x negative index ETFs earlier in the day
    my orders expired unfilled. and I was asking ASK price
    Seems like bears not ready to give up yet


  2. tony says:

    Hi Joe … it looked like mutual fund panic buying, especially the close.
    We\’ve had rallies like this throughout the bear market.
    Despite the rally, the KBE is well short of last weeks high, and the XLF is lower as well.
    If these two sectors can make higher short term highs, then the rally can continue.
    If not, it appears destined to fail like all the others.


  3. Prakash says:

    hi Tony,We had all sorts of bad news today and get one of the most lightning rallies so far this year…. makes me wonder if this run can proceed all the way to 89wk MA or 1430 levels. Need the payrolls number to be really bad. On the other hand, talk about higher highs is deafening. AAII bulls spiked last week… after today\’s rally and higher high talk, guess it may shoot higher?Joe


  4. MCKennedy says:

    Dow lost some steam at the trendline of the triangle which also happened to be the neckline of the dome that formed last week.  Needs to break that neckline at 12,580ish to continue the uptrend…..


  5. tony says:

    Hi Amos … that rally is certainly underway.
    Paulson, UBS and LEH did the trick.
    Hi Serg/Amos … let\’s just say sometime next week.
    Hi Oz … welcome to the Gold correction camp.
    Hi Fred, aka Stu … SPX popping right to the 1364 pivot and short term overbought already.
    Short squeeze? Ah ha it is April fools day.
    We had an abc up from 1257 – 1360.
    Then a pullback to 1313.
    Now we should get another abc up into the 1380 – 1400 resistance zone.
    SPX 1364 looks like a good stopping point for the \’a\’.


  6. MCKennedy says:

    Losing steam at the trendline of the triangle on the 60 minute chart…..


  7. MCKennedy says:

    20 week MA on SPX is 1383…..going up for a retest?


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