thursday update

SHORT TERM: gap up open = new highs again, DOW +122

Overnight the Asian markets that were opened finished mixed. None of the major European markets were open. US index futures were higher overnight, and at 8:30 weekly Jobless claims were reported lower: 338k v 379k. The market gapped up at the open to SPX 1838 and continued to rally. The SPX had closed at 1833 on Tuesday. The rally continued throughout the day as the market worked its way higher with only two point pullbacks along the way. Nearing the close the SPX hit 1843 and closed at 1842.

For the day the SPX/DOW were +0.60%, and the NDX/NAZ were +0.30%. Bonds lost 3 ticks, Crude added 40 cents, Gold rose $6, and the USD was flat. Medium term support now rises to the 1841 and 1828 pivots, with resistance at the 1869 and 1884 pivots. Tomorrow the economic agenda is clear.

The market gapped up at the open today for the second time this week. Monday’s gap up took the market to new highs, and today’s did the same. The current advance from the recent FED SPX 1768 low is still three waves. But the third wave is now nearly equal to the first: 1811-1801-1843. The negative divergence that was forming on Tuesday was cleared today as short term momentum reached extreme levels. A pullback, of some degree, can now occur at any time.

Short term support is now at the 1841 and 1828 pivots, with resistance at the 1869 and 1884 pivots. Short term momentum hit extremely overbought, and finished there. The short term OEW charts remain positive with the reversal level now SPX 1824. Best to your Friday trading!

MEDIUM TERM: uptrend new highs

LONG TERM: bull market


About tony caldaro

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71 Responses to thursday update

  1. torehund says:

    I think the most interesting development for the last week has been the continued surge of real economy stocks like shipping and commodity producing companies. Just how far it may go we dont know for certain, but I project that there will be more upside to come….and whats in line with the former is the fact that the dollar looks terribly weak, and is pressured by the liquidity infusion going to infinity or at least being prolonged until money gets expensive by itself, and for that to happen folks all over the world needs to un-caution themselves a bit more than what we see today. I played with the dollar making that final large C leg down WS the Norwegian Crown which would take it down to about 3,8 crowns to the dollar, its currently 6 crowns to the dollar. A depreciation between 30 to 40 percent is therefore possible and would scare whatever funds that is currently residing in US banks straight into gold and stocks. IF IF this is what we can expect there are good reasons to find a small cap play in the commodity sphere, and avoid the blue chips. Sitting in the latter you may preserve buying power, but experience no net gains if the dollar tanks.


  2. CB says:

    Tony, when you have a few minutes, what are your thoughts on natgas, please ? -5 waves completed already..where do you see support for the ST correction? Thanks.


  3. CygnetNoir says:

    For anyone interested, the Big Up from 12/13 looks like it may have run outta gas. A “little Big Down” is setting up that if triggered on Monday would target a test of the SPX 1801 – 1792. Higher prices Monday would keep the 12/13 Big Up intact.


  4. torehund says:

    Looking at some shippers that hasn’t been running too much and the box segment seems attractive, some have rallied 20 percent but they have been so oversold for so long and doesn’t seem to be giving back any. But don’t forget whats inside these vessels, lots of commodities.….I go for the most hated of them all, coal.


    • Per Hansen says:

      any particular stock Tore? I need some quick bucks. My bank made a mistake last week so I couldn´t trade the ticker FREE overseas stock and it doubled since, so need something instead to celebrate the newyear with


      • torehund says:

        Oxford rescources is cheap (28 mill mcap), there are of course issues attached to it, but Free isn’t in the good mans league either. Its however a risky stock as they all are more or less…Don’t go in full throttle. Combi-matrix, Rosg and Ecte, Mela are potential multi baggers in pharma (all at the magic 30 mill mcap) but they can all still shed up to 50 percent of current value before that ever happens. Maybe a bit safer still is TAU, box ship, here one may wait it out a bit but, it just doesn’t have to shed a lot if China doesn’t smoulder.
        I don’t mention individual nor risky stocks normally on Tonys blog, but due to a direct request I hope Tony don’t think its not too out of place to give Per some info about what I am thinking. But in stocks there are always lots of wrong footing(and bottoms are saturated with reverse splits and secondary offerings) so any advice to make a quick and easy buck just can’t be done. Its about breakouts and confidence in what you do and when to sell, its never fruitful to run these small caps 20 percent as such wins will never counteract your losses.
        One also has to know how to sell a spike when it makes a lower high, and count the waves for exit if its a longer motive move.
        Well, small cap investing is an art of its own and it takes years to reduce losses and reap the multi baggers. I could go on for a long time attempting to explain the intricacies, and also how not to loose confidence after a bankruptcy or two, lol. So there is a huge warning signs playing these stocks, but extremely gratifying if one after some time succeeds. For any wanting to get involved; do your charting, play small and build on your skills gradually.


  5. scorp100 says:

    Namaste Tony. Greece index jumped more than 4.75%.


  6. Thanx Tony sir for reply


  7. Namaste Tony sir,

    How these pivots are calculated for S&P like 1861 & 1841?


  8. manunidhi21 says:

    Namaste Tony !

    We had 1630-70 as top of bull market from mid 2010 under OEW.
    Do we consider fundamental analysis part of OEW ? If no, then isnt this 200 points 1650-1850 a bubble.

    Infact what is considered as bubble ?


  9. elmer510 says:

    A real good day for stocks here in Europe – markets have been closed a longer time than in the US during Christmas, so they try to pick up with the US leading this bullmarket into new highs.
    Like BobHopium said, shipping is really in the mood now showing big gains in few days.

    Picture is quite bullish. Tony wrote in his weekend update: “Since Intermediate wave one was quite long in the SPX, three months and 187 points ..”
    IM wave 3 should raise the same at least the same, so we take 1768 and add 187 and get a level of 1955 as the end of IM wave 3.
    There’s no guarantee of course, but Tony has often pointed to the fact that wave no 3 usually is the strongest.


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