thursday update

SHORT TERM: market rallies then new downtrend lows, DOW -29

This is our 3,000th entry on the blog. Overnight the Asian markets slipped 0.1%. Europe opened lower and lost 0.7%. US index futures were higher overnight, which recently seems to be the case nearly every night during this decline. At 8:30 weekly Jobless claims were reported much higher: 439K vs 355K, the CPI was reported slightly positive: +0.1% vs +0.6%, and the NY FED was reported still in contraction mode: -5.1 vs -6.2. The market opened flat at SPX 1355, tried to rally hitting 1361 in the opening minutes, then headed lower. At 10:00 the Philly FED was reported back in contraction mode: -10.7 vs +5.7. The SPX hit 1352 at 10:00, rallied to 1360 by 10:30, then made a new downtrend low at 1348 by 12:30. Just before 12:30 FED chairman Bernanke’s speech was released: The market again tried to rally, hitting SPX 1359 by 2:00. But it rolled over again retesting SPX 1348 by 3:30, then bounced into a 1353 close.

For the day the SPX/DOW were -0.20%, and the NDX/NAZ were -0.30%. Bonds lost 1 tick, Crude slid 85 cents, Gold dropped $11, and the USD was flat. Medium term support remains at the 1313 and 1303 pivots, with resistance at the 1363 and 1372 pivots. Tomorrow: Industrial production at 9:15, then Options expiration.

The market opened flat today, bounced around a bit, then made a new downtrend low at SPX 1348. The SPX has now declined 8.6%, or 127 points, from its September high. Yesterday we noted the largest downtrend ended the day after Thanksgiving 2011, and was 134 points. This is correct for only downtrends of this degree, which does not include the Primary II 2011 correction.

Despite the recent slide we still have wave relationship and retracement support just under today’s low. At SPX 1345/46 the SPX will have retraced exactly 61.8% of the recent uptrend, and Minor C = 2.618 Minor A. Just below this level, at SPX 1335, Minute C = 1.618 Minute A. Yesterday we upgraded the alternate bearish count to a 30% probability. That chart was first posted in last weekend’s update.

Short term support remains at SPX 1342/47 and 1333/38. Short term momentum is approaching extremely oversold, and still displaying a potential positive divergence – which has not meant much recently. The short term OEW charts remain negative with the swing level now at SPX 1381. Best to your trading!

MEDIUM TERM: new downtrend low at SPX 1348

LONG TERM: bull market


About tony caldaro

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105 Responses to thursday update

  1. Pingback: Latest QQQ ETF News | Wall Street Stocks

  2. dwr51 says:

    First time in a while the SPX made 2 higher highs after the low was in. Congatulations Tony
    Best to all

  3. LX says:

    yeaaaaa new high …how about that
    still pivot time though 🙂
    Thanks Tony and gang for letting me wag my virtual tongue here today ..

  4. pbnj123 says:

    Wow VIX just dumped

  5. LX says:

    .50% on the day @ 1349.50
    Im looking for an 3 wave move down but lately those have been rare 🙂

    • LX says:

      we can hang over 1349.50 it’s on ..if not 99% ?

    • CB says:

      nice! Lee asks for a 3way ove and Lee gets a 3way-move.
      Tony are you changing the green II to permanent anytime soon? – we need a reason to celebrate…

      • tony caldaro says:

        SPX just made its first higher high, after a low low, this month

      • LX says:

        Hey C B

        Nothing fer sure yet
        BUT I asked for a hot wheels race track fror Christmas back when I was 7 and I didnt get it… but my brother did ! So I think Santa owes me !

      • CB says:

        Tony, thanks…SPX has become a negotiation tool now and there is def. room below..will be glued to your charts as always.
        Haha Lee.. first of all: happy 3000+ (yes, ur posts here.. I didn’t count them but I am pretty sure ur over 3000 by now & we love em all, btw 🙂 Geez, a race track for Christmas?..that’s …well that’s a pretty outrageous request…although on second thought,’s really important to maintain a healthy sense of entitlement…so Santa you got the memo, right?.. give Lee sth. really nice for holidays…

    • LX says:

      back under 1348 ESZ and its back to guessing..but Im saying theres a chance of an impulse up today

  6. ajaysinghi says:

    Congrats Tony! Love to read your blog.

  7. pooch77 says:

    Up 20 points not looking to strong,am i missing something here

  8. LX says:

    pivot time….

  9. rc1269 says:

    AAPL about to put in a solid bullish hammer on the 60 min. Let’s get this party started!

  10. rc1269 says:

    and lookie there, some “positive” comments from congressional leaders regarding dealing with the fiscal cliff and we get the best pop in a while.

  11. H D says:

    LIVE action!

    • H D says:

      murderouos 10 handle bot signature. If/when the flip the switch…… JMHO but the technicals have really failed on this wave and that gives some credit to an impulse probability. If I had a $1 for every comment on VAL, POC, TICK yada yada. Anything working for u’all?

  12. tommyboys says:

    What just happened – anybody ? Looking for a reversal and we got a big spike higher just now…

  13. LX says:

    I’m bullish to a fault here…

  14. tommyboys says:

    Congrats Tony – here’s to 7 more years!

  15. LX says:

    Morn guys I got stopped out @ 1343 this morn from yesterdays attempted long swing trade.
    Thanks a lot APPL 🙂
    Dammit Jim I’m a scalper not a doctor

    • LX says:

      I’m scalping long against 1342

    • tommyboys says:

      Unless AAPL is going out of business they’re a screaming buy here. Got a note from a CFA indicating AAPL could not report certain profits out of China last Q and is why they came in light – but will be reporting them next Q which should push them WAY past estimates… Hope its true!

    • rc1269 says:

      AAPL just can’t seem to find a bid. I guess that’s what happens when every hedge fund in the country owns it. it’s killing every rally attempt in the mkt.
      on the bullish side, yeah it’s becoming a dividend yield play! 2% yield now, and climing by the minute

  16. ronini3 says:

    Happy 3000, Tony!

  17. rc1269 says:

    interestingly, the VIX just refuses to break out lately. can’t seem to get above that 18-19 range. is that the holiday effect? (lots of mkt closed days in the next 1.5 months)

  18. rc1269 says:

    Hey Tony, good morning! I recall you making a comment months ago that you thought that when AAPL had finally met its bull market high then so the SPX might as well. Looking at AAPL now about $175 off of its high, is that a thought that’s gaining some traction in your mind?
    with such a long and established upward trend I honestly expected AAPL to put in a much more gradual topping process.

    • tony caldaro says:

      Probabilities are increasing in that direction

      • rc1269 says:

        That’s a shame. oh well. what really baffles me is that we can easily see how things are going to play out with the election and all this fiscal cliff junk months ago. yet the market truly just ignores all signs until it’s immediate. i mean, all i hear now across the street is fiscal cliff this and that. seriously? people are surprised?
        the longer i’m in the markets the more i’m convinced they are not efficient and certainly not forward looking (at least not more than a few days)

    • tony caldaro says:

      Really, Fiscal Cliff? Interesting.

  19. newbie980 says:


    Congratulations on 3000th post. Cal Ripkenest! I have followed you closely for almost a year, and you are an island of sanity, courtesy and solid analysis in a turbulent sea. I appreciate your dedication, and your open mind to adapt and anticipate alternatives as the market unfolds. Thanks so much!

  20. LX says:

    You’re old school work ethic and generosity is inspiring
    Congrats and Thank You Tony !

  21. magnus1234 says:

    Tony. Thank you so much for all the 3000 posts. I have not read them all but everyone I have read has been very much appreciated. Thanks!

    • pas1968 says:

      I’m not familiar with Tom’s work however I have seem him on Bloomberg many times.
      I’m wondering if its a good thing that the SPX did not exhaust itself with the 13th Tom DeMark was looking for before the sell off.
      Tom was very clear in saying the SPX would surprise everyone and rise to 1480’ish before correcting, which obviously did not occur.
      So maybe this downtrend eliminates the exhaustion pattern Tom was looking for thus setting up for another run over 1480?

    • tony caldaro says:

      Do not follow others that closely

  22. torehund says:

    On SP 500 I see the correction as a double ABC, first one almost flat and next one steep, aweak reaktive bounce from 1377 to 1380 and the last decline from 1380 to 1360 as the ending to these two double ABCs. Nikkei has nice divergences
    Guess first ABC was a correction on overconfidence and the second one a correction of grave reaction less non buying and slight selling. But abcs can grow on themselves, we are far from out of the woods..

    • torehund says:

      And glad I did the tech analysis on DRYS on the bear flag it was forming. By the way Nikkei could also be working on a bear flag and test bottom at 7000 or so. lets hope not.

    • torehund says:

      And concerning Nikkei it it has been in an uptrend since 8100 and the 10 000 spike was a motivational wave one and june first 8440 was end to wave 2 we could see a helluva rally if it passes 10 000. That would be a dream come to reality, and drag the worst of the worst stocks to great heights.
      And Tony, thanks for keeping your blog !

  23. pas1968 says:

    I see on the weekly; SPX has broken the trendline from 2011 and needs to close Friday back round 1380 to get back on/above the trendline.
    I see on the monthly; SPX has broken down thru the small rising wedge from 2011 and needs to close November above 1410’ish otherwise looks bearish with next major monthly trendline support from 2010 at around 1250’ish.
    So we could be looking at a multi month decline to 1250’ish before any significant bounce.
    Certainly looking far from bullish at the moment, however a massive rally on Friday could change things a bit.

  24. timing101 says:

    Can I call you Mr. 3000? 🙂
    Awesome work Tony! Keep riding the waves.

  25. Congratulations on the 3000, Tony.

  26. CB says:

    Congratulations Tony! I’ve just read your 1st post from 2005. Very interesting!
    And I have a question whenever you happen to have some time, re: your July 1990 comment when you “pinpointed the exact top of the stock market within the exact hour of its occurrence.” That’s pretty awesome, Tony! Exactly how did you accomplish that? Did you work with some short-term cycles then?

  27. tsculpture says:

    Great accomplishment, Thanks for your efforts! Read your entries daily.

    I have noticed that the Dow and the S&P finally closed their gaps today. I have assumed this has been a downtrend indicator for the past weeks. Am I correct in assuming this may be indicative of approaching a near term bottom? Will they near parity at the end of the quarter, or am I assuming things?; am I grasping at imaginary straws? Thoughts Anyone, references to read? Thanks, Joel

  28. maks12 says:

    Congrats on 3,000 Tony. Seems like you never take a break, appreciate it!

  29. pas1968 says:

    Hi Tony,
    Just checking….
    Are you thinking the ‘upgraded the alternate bearish count’ will be confirmed if& when the DOW drops below 12000 in this current downtrend? & once confirmed the alternate bearish count means the bull market is over?
    What SPX/DOW prices targets does the alternate bearish count project for 2012/13/14?

  30. M1 says:

    No more comments until monday. Unless, we get a large move tomorrow.

  31. budfox9450 says:

    Tony _ Congrats on the reaching a 3000 blog entry level – quite
    spectacular, and a great achivement, and service – thank you.


  32. M1 says:

    Thanks, Tony !! ..and congratulations for this excellent blog. For sure, nothing will be the same with out it. Hope you have enough time and you like having this blog for many more years !!

  33. ko68 says:

    A bearish alternate and end of the bull cycle with the QE3 still running at full speed. That would have been something!

  34. tony caldaro says:

    That’s pretty much the level

  35. Tony, bearish alternate suggests that the bull market ended, right? IS Dow 12000 the line in the sand for confirmation?

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