friday update

SHORT TERM: new downtrend low, DOW +4

Overnight the Asian markets lost 1.1%. Europe opened lower, but gained 0.4%. US index futures were lower, and at 8:30 Q3 GDP came in higher than expected: +2.0% vs +1.3%. The market opened slightly lower at SPX 1412, bounced to 1417 in the first few minutes, then began to pullback. At 10:00 Consumer sentiment was reported lower: 82.6 vs 83.1. Then at 11:00 the FED released this: http://www.federalreserve.gov/newsevents/press/bcreg/20121026a.htm. The pullback continued until around noon when the SPX hit a new downtrend low at 1403. Then it started to rally. By 3:00 the SPX had rallied back to the high of the day at 1417. Then a pullback into the close ended the week at SPX 1412.

For the day the SPX/DOW were mixed, and the NDX/NAZ were +0.20%. Bonds gained 21 ticks, Crude added 5 cents, Gold lost $1, and the USD was flat. Medium term support remains at the 1386 and 1372 pivots, with resistance at the 1440 and 1499 pivots. The WLEI was reported slightly lower today: 56.0% vs 56.1%.

The market opened relatively flat today, bounced to SPX 1417, then rolled over to make a new downtrend low at 1403. After four days of bouncing around the SPX 1413/16 resistance area the market finally hit the SPX 1402/03 support area. After hittng the low, however, the market rallied right back to SPX 1417. While this market has worked its way lower this week, it certainly has been quite choppy since tuesday.

Short term support remains at SPX 1402/03 and then 1396/98, with resistance at SPX 1413/16 and then 1422/27. Short term momentum ended the week above neutral. The short term OEW charts remain negative, with the swing level now around SPX 1423. Best to your weekend!

MEDIUM TERM: downtrend likely underway

LONG TERM: bull market

CHARTS: http://stockcharts.com/public/1269446/tenpp

About tony caldaro

Investor
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9 Responses to friday update

  1. cem1214 says:

    Thanks for all the info tony. U r da man

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  2. M1 says:

    Thanks, Tony.

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  3. Tony, is there any scenario under which this correction will be considered over before a downtrend is confirmed?

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  4. torehund says:

    looking a little at the Dry bulkers to ascertain a level from which a retracement or motivated waves upwards will commence. Studying the dry ship charts taht seems to have now mostly fully completed 2 full ABC declines with associated post abc popps and lower bottom. The first post ABC decline bounce went to 16 usd and the second one to about 3,5 USD recently. So what I see from the top is ABC decline, corrective phase up in ABC fashion and then a long sloping ABC through the post financial crisis times. Should be a 3-3-3, I would like it to be a 3-5-3….but taken together with Tonys excellent BDI analysis I feel pretty confident a turnaround is in the cards. Mid one usd, or slightly lower would make me even more confident.
    Spanning such a long time, and not thinking too much about the smaller end waves in this large structure, its of course not easy to find the exact bottom. If the last months slow ascent is a bear flag one would expect a final decline to sub 2, but I am not too sure, most other bulkers are making all time lows as we speak.

    During the rally from end of wave 2 on the SPX, optimism has not been rampant, and the ascent has been neurotic, I look at the RUT/SPX overlays and they closely track eachother. Normally, exuberance is characterized by SPX and RUT diverging strongly.

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  5. ronini3 says:

    No politics, just a good movie. Even its trailer gives me the goosebumps..

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