tuesday update

SHORT TERM: another new high, DOW +72

Overnight the Asian markets, that were open, gained 0.1%. Europe opened higher, and also gained 0.1%. US index futures were higher overnight, and the market opened three points above Monday’s SPX 1841 close. Then continued to rally. Just after 11am the SPX hit 1849, and started to pullback. Around 3pm the SPX hit 1842, then spiked to 1849 just before closing at 1848.

For the day the SPX/DOW were +0.40%, and the NDX/NAZ were +0.60%. Bonds lost 11 ticks, Crude slipped 70 cents, Gold rose $7 and the USD was higher. Medium term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1884 pivots. Tomorrow is New Years Day. Happy new year!

The market opened within one point of matching the all time high, then made a higher high at SPX 1849 before pulling back. Quite a year considering the SPX started January 2013 at 1426. Nearly five years into a bull market, and it looks like 99% are finally bullish. The rally to today’s SPX 1849 high still looks like three Minute waves off the FED’s 1768 low: 1811-1801-1849.

Short term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1884 pivots. Short term momentum displayed a negative divergence at today’s high, and the market pulled back some. The short term OEW charts are still positive with the reversal level now SPX 1838. Happy New Year everyone!

MEDIUM TERM: uptrend

LONG TERM: bull market

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

About tony caldaro

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112 Responses to tuesday update

  1. passafiu says:

    Tony, HNY! Thank you for your great work. If I was to trade the miners in 2014, would you suggest using GDX or NUGT?

  2. other than being overbought does anybody see a reason for a correction of more than 10%? any event that can shock this market ?

  3. In ny last update, around third week of december, I did not take into account year end rally factor. But, I think we have hit top in markets around the world. Spx may try again to cross thus high but it is likely to fail. And even if it succeeds in crossing, it will be little margin. We are now in bear market.
    With due respect to tony who is doing this good work of educating people, I dont see him calling bear market in 2007. In fact he stick to his preductions of 1620 for at least three months, when spx had already started fall.
    people who were bulls have gone right for last thirty years but fed reserve was playing with sentimrnt factor and late 1990s and early 2000s, there was no alternative to the usa. Now, even uf america goes under not much will go wrong. Fortunztely, bcos of free capitalism, we made 60 years of progress in 20 years….with socielist model, it would have taken 60 years…

  4. Hi Tony

    Happy new year !

    Are there any plays/sectors you think is and will be interesting here in 2014 ? Anything you find “interesting”?

    Thank you

  5. hooloo1957 says:

    happy new year! Does anybody know why ewj and dxj are lagging the Nikkei? Thanks

  6. looking at options market and VIX fut index nobody seems to think this mild profit taking will morph into anything to worry about

    • tommyboys says:

      Right. Today not unexpected as folks lock in gains while postponing the tax bite for another year. May have a few days like this – which will also help burn off bullish sentiment. Nothing sinister here.

      • bobhopium says:

        Tommy…agree nothing much to see here, and would expect a rally into early spring to continue soon. GL to us all.

  7. tommyboys says:

    AAII – lost a lot of bulls and picked up some bears this week. Real fickle traders – doesn’t take much to swing them back bearish – although bulls need to fall a bit further…

  8. gary61b says:

    If vix pushes up through 14.61 then it should zoom up to 15.4

  9. 777daimon says:

    can you spell “Brad-ley turn date” ?😉 ?
    lowest point on 9 January ’14 (FOMC minutes)
    :* !

    • themoose101 says:

      Here are the Bradley Turn Dates for 2014. According to the Bradley model, if one believes in its concept, some dates are considered far more important or significant than others. Jan 1 is one of those significant dates. Jan 9, as you can see below, is one of many lesser dates during the year. It’s always interesting, in hindsight, so see how accurate the Bradley model has been.

      Most Important Turn Dates:
      January 1
      July 16
      November 20

      Other Bradley Turn Dates
      January 9
      March 22
      April 6, April 27
      May 6
      October 9
      October 16
      December 10
      December 26

    • buddyglove says:

      Bradley can kiss my Butt ! …..I’m getting long here. GL.

      • hucky2 says:

        My Charts show good support at 1820 – 2 trend lines cross there, normally produces a bounce.

  10. torehund says:

    For the last month gold miners has chopped in abc up and abc down, sure could be a bottom in the end of it, but as long as neither short nor long these miners don’t show any impulsive action in any direction, it just isn’t my kind of play. Toss a coin game for now ! Or wait for the fight to end and join the winning team.

  11. blubrd67 says:

    Does it look like we entered minor 2, or just minute iv here?

  12. mcmasoniam says:

    Bj, don’t know if you’re here, and since I have to go row with the others in a few minutes, I just wanted to say, either you’re very good with timing gold, or you’re lucky as hell, or both! You really do get the award of the yearS; 2013 & 2014! So you think to 1300 is the first bounce? I’m in for at least a bit of it. Immmmmpressive! Truly is, blackjack. Ever once in a while I’ve had set ups like those (beautiful, both ways) and they’ll fix you up nicely, so I bask in your glow right now. My sincerest Congratulations!

    I’m also seriously considering a move to Colorado after seeing this interview with a lovely auburn-haired young woman a few minutes ago on Recreational Dubbish. So, does anyone here think that citizen of USA could end up so placidly stoned on various Candy that Banks, USgovt & other could walk right in and take over our savings accounts?


  13. torehund says:

    M. Armstrong and his phi x 1000= one cycle= 8,6 years. Accordingly the new bear starts in Oct of 2015 for a 3 year bear until beginning of 2018. Long cycle of 306 years ends in 2032. Think its possible to stretch the bull for another 1 year and 9 months.

  14. rc1269 says:

    January P IV anybody?

  15. ewtoriginal says:

    Happy New Year to all and a special thanks to Tony for all his effort and tolerance.
    No surprise here, but the last bit extra kick rally has made me ten star bearish . I am not certain how this relationship plays out but it has been on my spreadsheet for some time so I will point it out: Wave 1 was approximately 555 (1221-666) . 1.382 x 555=767. Added to the 1074 low equals 1841. Market may have overshot by a bit, but this level is huge for my work.If it exceeds, the 1.618 move allows for 1972. I expect this year will not be as smooth as the typical forecasting strategists suggest, but the trading should be great.

  16. fishonhook says:

    Anyone willing to try and put a count to this chart? It is a very important one which we rarely discuss


  17. fishonhook says:

    What I have learnt coming here for the last year.

    1) Tony is a very giving, kind fellow. He has a good heart.

    2) Most of the folk coming here are probably not traders. They are probably here for general ideas on the market, entertainment and a good place to hang out. This is just my impression and I could be wrong.

    3) I thought OEW was not really useful for short-term trading but the long term calls were tradable. However when the count goes from bull market to end Winter to the following Fall with a possibility of a Bubble forming in between, then even long term calls are not tradable. That’s like a doctor saying ‘You are dying in a few months’ to ‘ you will live much longer and may even be in the best health ever’.

    4) Divergences work less than one in three times. With such a low success rate is it really worth even mentioning it.

    5) Despite the above, I am still going to come here. There are some insights Tony has which are worth reading. Especially the time when he gives us the more expansive view- like his count on the money supply, or Interest rates and his call on the gold bull being over has so far been spot on. I now find that most useful that the stock indexes.

    Any way a good year to you all.

  18. mjtplayer says:

    Hey Tony,

    I know you prefer the DOW count, but the S&P certainly looks like a 5 wave advance from the Aug low of 1,627. Looking at the 60min chart, when one steps back, it’s hard to argue that the S&P hasn’t risen in 5 waves, thus ending major 5 and primary 3.

    With the year-end and Santa rally all but over, we’ll see. The first couple days of Jan are usually positive due to new money flows, then the real test begins Monday Jan 6th. Can the bulls keep it going or are they out of gas in an overbought and increasing exhausted market? Bullish sentiment is very high at 59.6 and just 1% from the last peak of Oct 2007; bearish sentiment is at multi-decade lows of 14.1%, the lowest since 13.6% in 1987 – see link to Yardeni research posted 12/31. The number of bulls is now 4.23 times the number of bears, an all-time record – that’s not slightly bullish or optimistic, that’s outright euphoria.


    The stock market is WAY overbought and disconnected from any economic fundamentals, commodity/materials demand, consumer gauge, employment data or global growth. This is a bubble, clearly and without a doubt. Also, there’s nobody short and NYSE margin debt continues to move higher in parabolic fashion. On page 15, another concern arises – volume. We’ve had extreme low volume since 2011, this market has moved straight-up, at a staggering degree over the past 2+ years, with no volume.

    I agree that euphoric markets can continue longer and higher than anyone thinks, like housing in the 00’s, stocks in the 80’s or 90’s and commodities in 2008; but euphoric markets all end the same way. The higher they move on this Fed induced drug binge, the longer and steeper the next bear market. Can’t be short yet, but I would be very nervous holding longs in 2014, cash seems to be the safest place IMO. Perhaps start buying assets that have been washed-out like gold and agriculture (corn, wheat, coffee), down 35% – 60% and continue to short long bonds and the Yen.

    Other than a few trades like above, my major philosophy will be “hold cash and wait for the crash” in 2014 & 2015, perhaps into 2016.

    Happy New Year Everyone!!!

  19. gtoptions says:

    Thanks to Tony and all the contributors that remain objective.
    Happy New Year! 🙂

  20. blackjak100 says:

    Happy new year tony and thanks for all you do! 2014 is sure to be interesting!

    McM, great call on gold not reaching my $1166 target! I did get long near $1200 as I think an int trend change took place. However, I didn’t get out fast enough so took a small loss on my reshort. All in all, it was very profitable for me on the way down. I have no target yet, but certainly it should surpass $1300 again. I am not short crude yet as I firmly believe the retrace is not over quite yet. Interesting to see gas prices have soared once again post holiday just like last year.

    • mcmasoniam says:

      GM bj, my congrats to you on your gold ride! Also agree that retrace in oil not quite over,also, not much retrace left. I think all the commodities will tend to get squirrelly here as the trends begin to change; a change that could take a couple months to completely reverse.


  21. bobhopium says:

    Wishing all here a happy, healthy and prosperous new year, and special thanks to the “Master of the house” Mr T.Caldaro for his hard work and for putting up with us all 😉
    I am still very bullish going into the spring 2014, and I still like Europe,Japan,South Africa,Uk and Usa…also just started nibbling at Turkey,Brazil and Peru.
    Good Luck to us all in 2014.

  22. Mission accomplished: the rockets have been propelled to escape velocity

    Last night 31.12.12 closing print propelled all 4 major US markets (SPX, DJIA, RUT and NDX), above their 2007 peaks (for SPX, DIJA and RUT, that means also above their previous all-time high), by such a margin that a minimum fib retracement (23.6%), would still be above their previous peaks.

    Will the central planners at the FED allow for some weakness now that they might think escape velocity has been achieved?


  23. Vox Zeit says:

    Tony et al,

    I’ve visited this blog every single day in 2013, and I look forward to visiting it every single day in 2014 ritualistically.

    The excellence you share every day is truly a selfless act: a market compass, more so a moral compass; I bow down to thee!

  24. surfonmobile says:

    Happy New Year Tony and everyone here. I wish you have a very great 2014!

  25. hkloon says:

    Happy new year to Tony and all. May 2014 be another prosperous year…. thx..

  26. cyassin says:

    Tony and all members here I wish you a Happy New Year 2014!! God Bless you all !

  27. M1 says:

    One more

    See you next year

    • buddyglove says:

      I really don’t know why Tony tolerates these space hogging pieces of trash. I have seen far less offensive and smaller posts deleted, must be the season of good will i suppose.
      Schiff is just another dangerous “Siren with an enchanting voice” leading unsuspecting investors to their rocky financial doom. God only knows how they justify their huge fees for being wrong,wrong,wrong for so long,long,long.

    • valunvstr says:

      One of the all time biggest jokes out there. Keep buying gold and international stocks Peter. A broken clock is right twice a day. Only problem is that the clock is wrong the other 1438 minutes.

    • M1 says:

      For now, I am just curious how Japan will pay its debt if rates rise to 5%. Their total Tax Receipts are abt $500B. So, how will they pay $500B in interest ? =)
      Japan is broken and the world doesn’t care. Should we care ?
      “Years of fiscal stimulus to revive a stagnant economy and surging social welfare costs for a rapidly ageing population have led to Japan running a record 1,000 trillion yen ($10 trillion) in public debt, double the size of its economy and the biggest among major industrialized nations.” (Reuters)

      • valunvstr says:

        Japan’s rates have been near zero for 2 decades because they are an old population with closed borders and culturally not built to drive economic or profit growth. If they get to 5%? What is the sense in asking such a silly question? Given age, population and culture, their rates are going nowhere anytime soon. And if they did that would mean that growth was exploding and pulling them from the deflation they’ve been stuck in for over 2 decades. They own their own debt. And no we shouldn’t care about Japan. Do people look for things to worry about in hopes they can come to an investment conclusion they are hoping for. WHO CARES ABOUT JAPAN? They’ve gone nowhere since 1989 and a US investor and even a good international manager has made a lot of money in that time period.

      • M1 says:

        It is quite interesting people don’t care abt the second largest economy in the world. =)
        Should we care abt the first economy in the world ?

  28. fionamargaret says:

    Thanks Tony…….and Happy New Year to all xxxx.

    Keep well YenGuy.

  29. mike7x says:

    Happy New Year Tony! And everyone!

  30. hucky2 says:

    Anybody know why Wed, Jan 15, 2014 Outright Treasury Coupon Purchases $4.00 – $5.00 billion
    FOMC is not till 29th. What is happening on 15th?

  31. elmer510 says:

    Happy new year to Tony and all !
    Hope we’ll have another prosperpous year.

  32. M1 says:

    It looks like we still have a lot of bears yet or something is really gonna happen in 2014 ?

    • buddyglove says:

      I like Celente, but he is really just another Short Equity/Long Gold Muppet who likes the sound of his own voice.

    • tony caldaro says:

      Is Gerald still buying Gold?

      • buddyglove says:

        Tony, yeah, not sure he bought any since Corzine looted his account of a 6 figure sum. I know he wanted to exercise his gold futs he had with MF global and take phiz delivery, but looking at the price of spot he would be better of getting his $ back rather than the shiny stuff. I find him very entertaining but his famous trend forecasting has been way off the last few years. btw.. Happy new year.

    • mcmasoniam says:

      M1, Tony and bglove have the low-down on these guys, kind of like Peter S., etc. However, I will say that I suspect that banks will become tighter and tighter regarding the amounts of cash they will let larger depositors, then, smaller depositors withdraw. I have no idea of all that’s going on behind the scenes, but there is a global currency battle and it comes across as looking like the possibility of a gaping hole that still exists from the days of The Credit Crisis. Despite all the money that’s been pumped into the Systems, the velocity of it isn’t sufficient to lift global economies out of the rut they’re in. I believe the pops we’re seeing in GDP and other readings are temporary. Perhaps because of a sudden spike in rates in the future, or other reasons, this will become glaringly apparent. Most people don’t like my strong opinion regarding Jobs, Housing & Demographics, so, think of some others that fit the bill. Jobs/Housing/Demographics would only be the catalyst (again); I believe the problem already exists, which will be made much worse as the global economy slows over the next few years. The difference between people like Schiff and the other Inflationists is that I’m a dyed-in-the-wool Deflationist, and believe the implications of deflation are much worse that those of inflation. Regarding The Fed, I don’t believe for one second that Bernanke was pushed or urged out of office in any way; he’s getting out while the getting is good. He’s done all he can do and I suspect he thinks there will be a failure sometime in the near future.

      It’s not unwise to hold back as much cash as you can, and NOT in a safety deposit box, please. I assure you they will be checked for stash. Should another Crisis occur, I think the only legal transactions, bill payments, etc., will be institution-to-institution, via debit/credit cards; direct electronic transfer. You will only be able to legitimately pay bills, make purchases in this manner. However, cash is always handy. Once this secular Bear stock market decides to bottom by losing about half it’s worth, there will most definitely be some very upset people who will no doubt be visiting their banks and government offices. Wouldn’t surprise me to see the situation twisted and turned into banks & govt trying to take control of all savings accounts, 401k’s, etc.

      We live in VERY interesting times.

      Simplify (if you can).

    • torehund says:

      Gerald is an excellent actor, he cries out all his frustration and anger, then he feels better himself, lol. He made his own personal therapy his work. Congrats to him !

    • valunvstr says:

      Why is something always “going to happen”? 10% corrections? Yup! 20% corrections? Yup! Even 30% bears like 1980-1982? YUP! Unless one is retired, who cares? And even in that case, one should own a bunch of high quality bonds to diversify the tail end risk. And please, oh please, don’t start telling me about getting killed in both bonds and stocks. 10 yr ust bonds and stocks have only been down in the same year three times since 1926, so let’s not go down that road.

  33. Happy New Year, Tony! Your day-in, day-out and weekend commentaries are appreciated — not taken for granted. I realize the work you put into this … at no cost to any of us May you be blessed with a healthy, happy, prosperous year ahead..

    • buddyglove says:

      Interesting ? not really, these muppets have been saying the same thing over and over again since SP@1400. Just because he has a nice suit and tie, and is on tv don’t ever assume he knows anymore about where the mkt is heading than you do. HNY.

    • tony caldaro says:

      I never feel bad after a cup of coffee😉

    • valunvstr says:

      This guy was wrong even when everyone said he was “right”. He said we would have a bull market in the late 1990’s that would lead to a Dow at 35k. Um, a little off there. He also opened up a fund based on his thesis that then closed because it’s performance was so pitiful. How anyone follows or even acknowledges guys like Precter, Schiff or Dent is just beyond comprehension. You can throuw Hussman into the mix of guys who “sound smart” but come to so many wrong investment conclusions. And as an investor, the investment conclusion is all that matters. Like Schiff saying (somewhat paraphrased) “The Fed will keep printing so you have to own Gold. It will go higher as the Fed destroys the dollar”. Well, the Fed kept printing and guess what happened to the price of gold for 2+ years. Right about the Fed, wrong investment conclusion.

      • ewtoriginal says:

        Thats all fine, but please tell valunvstr how you positioned yourself in 2007 after the decline from 1550 to 1350. Based upon your thesis, I presume you were still 100% long or more.How did you react at that level? Did you consider reducing or hedging? And what happened upon the break of that level after the retrace back up to 1400s failed and smashed through 1350 falling to 1100..did you feel comfortable then about your positions ? What about at 700 when the majority of non professionals were panicking as their net worths evaporated? You sound as if the recovery with massive central bank liquidity measures was assured. Will that infusion always be available at effective cost? Please answer those questions and then tell if you believe the Fed has other tools or liquidity measures to adopt once they may be needed again perhaps in 3-5 years ? Sanguine as you may be, markets have not always been as forgiving as the past 25+ years suggest.You know that. I am not intending to be antagonistic, but wish to hear sentiments of someone of your beliefs and the emotion at the time.

      • mmmiiikkkeee says:

        excellent post, ewtoriginal

  34. pooch77 says:

    Happy New Year to Tony and Bloggers,watch for our pullback starting Thursday into Monday then a nice setup for long into mid January

  35. Dear Tony, Thanks for all your service through this blog. Wish you a Happy and Prosperous New Year ahead.

  36. mjtplayer says:

    Happy New Year Tony! Thank you for all that you do!

  37. mcmasoniam says:

    Happy New Year Tony and All!

  38. moo42 says:

    Tony – Happy New Year and thank you for your consistent and selfless blog. I’m not sure any of us fully realize the time and effort you put into this. You are da man!

  39. CygnetNoir says:

    Happy New Year, friend Tony, and thank you for another fine year of OEW commentary!

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