thursday update

SHORT TERM: another gap down day, DOW -59

Overnight the Asian markets were mixed. Europe opened lower and closed -1.75%. US index futures were lower overnight as well. At 8:30 the weekly Jobless claims came in higher: 429K vs 414K. The market gapped down substantially at the open to SPX 1276 and continued to 1264 by 10:00. The SPX had closed at 1287 yesterday. At 10:00 New home sales were reported relatively flat: 319K vs 323K. The market rallied quickly to SPX 1271, and then rolled over again hitting 1263 by 11:00. That was the low for the day. At 11:00 the FED issued the following: http://www.federalreserve.gov/newsevents/press/bcreg/20110623a.htm. The market then rallied back to the opening level of SPX 1276 before rolling over again. Around 3:00 the SPX hit 1268 and then spiked higher. Within a few minutes the SPX hit 1283. It then pulled back to SPX 1277 by 3:30 and rallied to close at 1284. Wild day!

For the day the SPX/DOW were -0.40%, and the NDX/NAZ were +0.75%. Bonds gained 20 ticks, Crude dropped $3.65, Gold fell $26.00, and the USD was sharply higher. Support for the SPX rmeains at 1261 and then 1240, with resistance at 1291 and then 1303. Short term momentum hit extremely oversold early in the morning, then ended up above neutral. Tomorrow, Q1 GDP at 8:30 along with Durable goods orders.

The opening gap down broke through the SPX 1280 level we noted yesterday. The rally from SPX 1258 to 1299 looked like a three wave affair at that point. But it could also be counted as a five, (10min chart), should today’s SPX 1263 low hold. The pullbacks were quite small during the move from SPX 1268 – 1299. Traders appear to be perplexed, as this market has had six gap openings in the past eight trading days: three up and three down. The past couple of weeks have certainly been quite volatile. For now, we’ll maintain our tentative downtrend low at SPX 1258 labeling. This sharp pullback from SPX 1299 to 1263 could have been a steep second wave. SPX 1258 looks like a good stop going forward. Short term OEW charts ended the day barely positive after turning negative earlier today. Tech leaders did quite well even during the selloff. Best to your trading!

MEDIUM TERM: downtrend at inflection point, low SPX 1258

LONG TERM: bull market

CHARTS: http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1606987

About tony caldaro

Investor
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22 Responses to thursday update

  1. short term S&P head and shoulders neckline broken

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  2. pa100 says:

    a failure from a gap-up open. It seems to me that it has tested this SPX area 4 times already in recent days. Usually if it takes more than three tests it will cut through support, no?

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  3. MGD says:

    Even when this could be a bottom consolidation is not what I was expecting for the market to move higher so I am moving my stop to 126.5 ..abt the same price I bought yesterday..
    Good lock

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  4. massoodh says:

    Hi Tony,
    Based on my technical analysis of SPX current corrective downtrend a break out above SPX 1300 will be the trend reversal of this downtrend. Do you agree that the break out above SPX 1300 confirms that minor waves 1 and 2 of the new impulsive uptrend from SPX 1258 bottom have been completed?
    Thank You

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  5. gemxwavedotcom says:

    Elliott Wave Forecast for 6.24.11 The Bottom Is In. http://Elliottwave.info

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  6. MGD says:

    Thanks Tony.
    Even when I still expect DJI going to abt 12300-12400 next week or two, I have some questions abt the count…I think we can not count this as wave 2….the fact is that SPY broke the previous lows according to several charts providers (not at stockcharts.com)…so this may be wave b and wave c should be unfolding and that is a corrective wave …not bullish…if wave c is unfolding it should end quite soon and going not much higher
    what do you think ?..

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  7. appleal says:

    Perplexed is an understatement.

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