thursday update

SHORT TERM: new high then pullback, DOW -40

Overnight the Asian markets gained 2.3%. Europe opened higher and gained 0.9%. US index futures were higher overnight as well, and at 8:30 weekly Jobless claims were reported higher: 309k v 293k. The market opened three points above yesterday’s SPX 1726 close, hit 1730, and then began to pullback. At 10:00 Existing home sales were reported higher: 5.48mln v 5.39mln, the Philly FED was higher: 22.3 v 9.3, and Leading indicators were higher: +0.7% v +0.6%. The pullback continued until 2:00 when the SPX hit 1720. Then after a bounce to SPX 1724 by 3:30 the market closed at 1722.

For the day the SPX/DOW were -0.20%, and the NDX/NAZ were +0.15%. Bonds lost 13 ticks, Crude slid $1.60, Gold lost $1, and the USD was higher. Medium term support remains at the 1699 and 1680 pivots, with resistance at the 1779 pivot. Tomorrow is Options expiration Friday.

The market opened higher today and made a new high, then yesterday’s no-taper euphoria tailed off and the market pulled back. Bonds and Crude also reversed turning lower, while Gold was lwer and the USD higher. After hitting an uptrend high at SPX 1730, the market had a notable pullback to 1720. Only the second pullback this week, and only the third one in the past ten trading days. That was quite a strong rally from what we are now labeling the Intermediate wave ii low at SPX 1641. We can count five waves up (1665-1654-1705-1695-1730) from that low. Suggesting Intermediate wave iii may have concluded at today’s high. Should the current pullback extend from 10 to 20 points we would consider it Int. wave iv.

Short term support is identical to medium term: we dropped the 1762 pivot as it is no longer an applicable Fibonacci relationship. Short term momentum dropped near neutral today after hitting extremely overbought. The short term OEW charts remain positive with the reversal level now SPX 1698. Best to your trading on the potentially volatile Opex day.

MEDIUM TERM: uptrend

LONG TERM: bull market

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

About tony caldaro

Investor
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247 Responses to thursday update

  1. mjtplayer says:

    BOJ meeting in 2 weeks, Oct 4th. Many are speculating that the Fed not tapering opens the door for the BOJ to ease more (if that’s possible). Don’t count on it. Expect the BOJ to stand pat on current easing, no new stimulus, thus a Yen rally. A rallying Yen is bearish for equities, as it triggers an unwind of carry trades.

    Longer term, the Yen is toilet paper. But short and intermediate term, the Yen is so heavily shorted that its time to begin a squeeze. Expect a 90 – 92 Yen in the months ahead.

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