monday update

SHORT TERM: market rebounds, DOW +68

Overnight the Asian markets were mostly lower. Europe opened lower and closed -0.35%. US index futures opened sharply lower overnight but turned higher nearing the open. At 8:30 Personal income was reported positive: +0.4% vs +0.3%, Personal spending was reported positive: +0.7% vs +0.4%, and PCE prices remained out of negative territory: +0.0% vs +0.1%. The market opened higher at SPX 1280. It had closed at SPX 1276 on friday. In the opening minutes the SPX bounced to 1282 and then started to pullback. At 9:45 the Chicago PMI was reported higher: 68.8 vs 68.6. The pullback continued until about 10:00 when the SPX hit 1277. That was the low for the day. From an extremely oversold short term condition the market started to rally. Around noon the FED issued the following: About 12:30 the SPX hit 1287 and began to pullback. At 2:00 the FED issued this report: The pullback ended around 3:00 at SPX 1281, and then the market rallied to close at 1286.   

For the day the SPX/DOW were +0.65%, and the NDX/NAZ were +0.50%. Bonds lost 12 ticks, Crude rallied $2.65, Gold slipped $3.00, and the USD was lower. Support for the SPX remains at 1261 and then 1240, with resistance at 1291 and 1303. Short term momentum turned higher after an extremely oversold condition. Tomorrow, Construction spending and ISM manufacturing at 10:00, then monthly Auto sales in the afternoon.

Last night futures trading started like the market was going to selloff today. After a hour of selling the futures market began to recover and was up for the day heading into the open. On friday the SPX was extremely oversold and was due for a bounce. That bounce occurred today. But the market had trouble when it hit resistance on the short term OEW charts at SPX 1287. Thus far the SPX has declined 28 points off the 1303 uptrend high and retraced 12 points of that decline. Meanwhile short term momentum has recovered from extremely oversold to neutral. Overhead resistance remains at the 1291 pivot and short term at SPX 1287, short term support is now at 1275 and then the 1261 pivot. Best to your trading!

MEDIUM TERM: uptrend under pressure

LONG TERM: bull market


About tony caldaro

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33 Responses to monday update

  1. Lee X says:

    It has begun here in the western suburbs of Chicago.
    SnowGasm 2011 !!


  2. CB says:

    Tony, you’ve just updated the yen chart, right? I foolishly sold it yesterday thinking that simultaneous uptrends in equities and in the yen cannot co-exist (?)


  3. zimbabweanimike says:
    The 75 percent of would uses Brett as the cost of energy. Benrons -4 percent destruction of the Bucky ytd and the 60 percent rise in oil (since qe)should destabilize more bs shortly.



    • CB says:

      Hey Mike, what do u think: is Orlando priced right yet, or it’s going to take a little longer?


    • zimbabweanimike says:

      Not sure, Can check later with a contact..
      In my area the mkt is like suspended. Nothing happening.


      • CB says:

        Thanks Mike!…if it’s not too much hassle… This messy foreclosure stuff creates a lot of legal uncertainty…that’s what worries me the most…plus some stuff about HOAs …scary


  4. CB says:

    based on some oscillators, this could run to 1315. And I’d think we have some unfinished MACD business around 1285. so…it should be good..soon


  5. CB says:

    Hey Tony,
    Are you OK….do you have power?


  6. H D says:

    99% ha! I have no clue where we are. That was just 1 wave down from 1303 so I was expecting a retrace. If it was X then the pattern starts over. Sux bcause we were here buying the 1261 pivot and let em go too early.


  7. MGD says:

    Hi Tony, premarket is strong, so is this bounce an abc of wave 2 down or is it something also ?..what should we expect on both sides to confirm what direction could take the next wave?…


    • tony caldaro says:

      So far it looks like this uptrend may be extending. Cleared the 1303 pivot and now into 1313 pivot range. Will need to review after today’s action. But today’s action does create another even more bullish potential count.


  8. H D says:

    1.618 @1288.50~ Pivot


  9. lemosbrasil says:

    Hi Tony

    There are 2 different movements in this fall.


    between 10 and 20 january there were 2 tests in MME13 and mme21. In these 2 times, close was above mme13. In this fall now (friday), close in friday test MME13, MME 21, and stay there !!


    THE VIX in those fall between 10 and 20 january, closed inside bollinger band !
    Now, in friday, VIX closed outside bollinger band ! and today confirmed breaking trendline from 47,5 (may) – 23 (december)

    I hope you have understood me Tony !


  10. vmahambare says:


    BSE wave 4 went down by few points into wave 1. If you see Nifty $CNXN then wave 4 is not gone into wave 1 yet. Do you think ongoing count may be wrong. If current count is correct then wave 4 has no more room to go down now?


    • tony caldaro says:

      Welcome Vmahambare, So far that slightly dip is not a problem. It happens occassionally. What’s more important is what the Sensex does from here on out. Keeping an eye on it.


      • vmahambare says:

        got it. Also since nifty stayed above 1, I am still with bull case. Bought epi, inxx, indl etc. Looks yesterdays open lower and then just kept coming up is good sign. Of ocurse some kind of re-test to low can happen but not breaking todays low will be good sign going forward.


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