thursday update

SHORT TERM: market rallies on Q2 GDP revision, DOW +213
Overnight the Asian markets were mixed, but Europe opened lower and closed +1.45%. At 8:30 the Commerce Dept. reported that the revised Q2 GDP has been raised from 1.9% to 3.3%, due to strength in exports and a larger inventory buildup. The details of the report were not at all that encouraging. The weekly unemployment report showed first time claims dipped 10K to 425K. The market rallied on the news. At the open the SPX gapped up slightly to 1286. Then after breaking through the 1287 pivot continued higher, in a choppy fashion, to the recent highs of 1293 by 11:00. After a small pullback the rally continued, breaking through 1293, and then chopping its way higher right into the close to reach 1301. At the close the SPX/DOW were +1.65%, and the NDX/NAZ were +1.00%. Bonds lost one tick, Crude dropped $2.50, Gold gained $5.50, and the Euro was lower. Support for the SPX now notches up to 1287 and then 1261, with resistance at 1316 and then 1327. Short term momentum was extremely overbought at the close. The near term indicators are also getting overbought as well. Tomorrow the PCE will be reported at 8:30, with the Chicago PMI and Consumer sentiment at 10:00. After holding support at 1261 this month, and the break through 1293 today, this uptrend continues to stay alive. Best to your trading!
MEDIUM TERM: uptrend high SPX 1313 may be tested
LONG TERM: bear market

About tony caldaro

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87 Responses to thursday update

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  3. Erik says:

    Impulsive,Not at all.  Let me explain a bit.  Yes, I placed my trade before these statements.  The 5 day chart showed a probability of being a correction ABC at close yesterday.  A was almost = C.  I decided to short.  Unfortunately I\’m *very* impatient and my long term view is still bearish.  My plan was to wait for 1320 (if it was hit).  Since we opened down, I figured it may not make it up to another leg.  So, I shorted on the bounce after open.I\’ve got a 15 min, and a 5 minute chart.  I like to see the micro-waves unfold as they give better hints than simply looking at the 60 min, daily.So, from 1261, we had a possible ABC up, ( possible 1,2,3 ).  that\’s all I needed to place a trade.  Later when the trendline broke I wrote my first message below.After looking at the 5 minute (5 day) – I noticed there was another possible count, where it was acceptable to break the trendline (or at least come close).  I was almost ready to place a stop to close the trade, but I didn\’t.If you pull up the chart of the 5 minute for today, we showed a clear impulsive down, a pop to retrace, and that\’s when I posted "impuslive down" and felt pretty good about keeping my short.The problem with wave counts is that there are always alternatives.  Its easy to get too comfortable with a view and not see the alternative.I wrote my second message to simply say that there was an alternative I saw, that the previous post wasn\’t necessarily the only count I had.Regardless, it was definately a good day to be short.  Tuesday, things could change on a dime.  We should in theory complete the second impulsive down we started at 1285, after a bounce Monday morning.  That\’s all I can *predict* as a likely outcome.  The market decides what to do, all I can do is place a trade based on some clues that are unfolding.Good luck 🙂


  4. Impulsive says:

    I am confused.  You
    shorted the S&P @ 1295 (the very last time SPX above that level was at 10:01AM EST) before you made these 2 following statements:


    August 29 10:51 AM The 15-minute today show the run
    from 1261 to be 3 waves up, and we just broke our trend.  This has been
    most likely *more* corrective action.  It\’s still very possible to see
    1320, if we get another leg that\’s equal in size.  Regardless, this is
    *good* for bears since it\’s not impulsive.

    August 29 12:22 PM I pulled up the 5 minute for the
    last few days.  I can actually label this 1-2, 1-2-3-4 so far.  As
    long as 1285 holds, it can certainly be impulsive.


    Not picking on you.  I
    am just not sure about your trading logic.


  5. Unknown says:

    Bud, From my novice eye, it looks like the eye formed better after passing the island…probably to be expected.
    All, I counted 5 waves for 1301–>1285 and I can count a 5-3-5 so far for 1291–>1283 meaning we still need a 45 to complete c and meaning my 1275-1281 abc target is likely at a minimum Monday. Much lower than that suggests 1302 was a top of significance and we\’re in a 123, not an abc from 1302. Of course, a break below 1261-1264 would still be needed for confirmation. I managed to make up for most of my losses yesterday when I expected 1283-1287 to hold. ISE and CPC moved off extremes but are still leaning bullish despite 1-2% down in most markets. Not a good sign for bullish counts. I wish everybody a good Labor Day weekend.


  6. MT says:

    The 1313 top of 08-28 has a high reliability of the end of wave 2 of Major C. It retraced almost 78% of the drop from 1313 to 1261.
    1313= int med B
    1261= wave 1
    1313= wave 2
    I think some see 1313 as wave 1
    1261 as A
    1300 as B
    and C still dropping near 1261 to end wave 2
    Watch carefully the structure from the july bottom to 1313, is it impulsive?


  7. tony says:

    Enojy the weekend guys!


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