thursday update

SHORT TERM: pullback continues, DOW -50

Overnight the Asian markets lost 0.2%. Europe opened lower and lost 0.7%. US index futures were lower overnight. At 8:30 weekly Jobless claims were reported higher: 368K vs 330K, Personal income was higher: +2.6% vs +0.6%, Personal spending higher: +0.2% vs +0.4%, and PCE prices were flat: 0.0% vs 0.0%. The market opened two points below yesterday’s SPX 1502 close, then dipped to 1498 before trying to rally. At 9:45 the Chicago PMI was reported higher: 55.6 vs 48.9. The market then rallied to SPX 1504 by 10:00. Another pullback followed to a lower low at SPX 1497. Then after hitting quite oversold, short term, the market tried to rally again. At 2:30 the market made another lower high at SPX 1503, then pulled back into a 1498 close.

For the day the SPX/DOW were -0.30%, and the NDX/NAZ were -0.15%. Bonds gained 3 ticks, Crude slid 45 cents, Gold lost $10, and the USD was lower. Medium term support drops to the 1440 and 1386 pivots, with resistance at the 1499 and 1523 pivots. Tomorrow: the monthly Payrolls report at 8:30 (est. +180K); Consumer sentiment, ISM manufacturing and Construction spending at 10:00; then monthly Auto sales.

The market opened slightly lower today, dropped to the SPX 1498 level we noted yesterday, rallied to 1504, and then dropped to a lower low at 1497. This lower low completely retraces the potential Minute wave v we noted yesterday, (1498-1510), suggesting Minor wave 3 completed at SPX 1510. To confirm this event two things should occur: 1. a pullback of more than 10 points – done, and 2: our short term OEW charts turning negative, which currently requires a drop to below SPX 1497. Probabilities suggest this will occur shortly.

With Minor wave 3 completed at SPX 1510 we should then expect a 30+ point decline for Minor wave 4. There is some wave structure support around SPX 1480, and then the bull market breakout level is at SPX 1471/75. After this pullback, the uptrend should then resume its rise to new highs for Minor wave 5.

Short term support is at SPX 1471/75 and 1462/64, with resistance at the 1499 and 1523 pivots. Short term momentum dropped to quite oversold after yesterday’s negative divergence, then bounced to neutral before heading lower again. The short term OEW charts remain barely positive with the swing level now around 1497. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: bull market

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

About tony caldaro

Investor
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174 Responses to thursday update

  1. Sold my SSOs earlier today at $67.90. Had one batch, in different account, I realized, still from Jan 2nd… bought those at $62.30… That was a nice run!!! All out of my market-related longs for now; enjoying my profits for a beautiful sunny weekend in Cali.

    I really enjoyed my first day on this blog and look forward to the weekend update. I note that the weekly SPX chart looks long and strong, with a strong MACD, prices pushing against the upper Bollinger Bands (BBs), the BBs expandin, and the RSI (14) is also long and strong. But, nearing OB. The full stochastic is totally MAXed out. All very bullish and seems like we need a red-week or so to bring things back to more normal before the uptrend resumes. Can we say Minor 4 next week?

    Tony what are the odds this puppy will straight go to 1550??? From a Fib extension perspective it seems unlikely (e.g. 1520isg is 1.23x wave 1 and often that’s where a wave 3 (of 3) ends.

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  2. tommyboys says:

    MMM… 166 messages so far… near term top indicator ? Ten Year holding above 2% this afternoon with equity rally.

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    • torehund says:

      Yes its getting bullish, so macros better keep up to keep it going.,…

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      • torehund says:

        At some time in history bulls get it right too….what we have seen until now is reflation of disaster and some tech stocks running like Apple, rest is pretty much very much in the shambles.

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      • spx881 says:

        There are no macros, there is only negative interest rates for savers and all printing presses rolling 24/7. Bernake should go to prison for literally forcing the average 70-90 year old Ma & Pa to either leave their hard earned cash in the inflation adjusted negative 2-5% return savings account, get into a game they don’t understand, or hide their cash under their mattress. Macros absolutely do not support an SPX 17.5 PE, so when the ink runs out and Ben’s helicopter crashes, carnage and a global economic meltdown (on a scale that will make the “Great Depression” and the 2009 crash seem like a walk in the park) will ensue and the “Greatest Depression” will have begun.

        Believe it is as sure as death and waking up with at least, one of those Friday night whiskey soaked eyes at 1:50 am, telling you she is the hottest woman your dumb ass has ever laid eyes on, and now that 1:50 AM beauty is that 9:00 AM (Holy Sh^t how in the f#ck did I get here and who is that 300 pound beast in the kitchen making me breakfast?

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