tuesday update

SHORT TERM: another gap up opening, DOW +106

Overnight the Asian markets lost 0.3%. Europe opened lower but gained 0.7%. US index futures were higher overnight, and at 8:30 the Trade deficit was reported lower: -$34.3bn v -$40.6bn. The market gapped up at the open to SPX 1834 and continued to rally. The market had closed at SPX 1827 yesterday. Around 10:30 the SPX hit 1840 and then pulled back to 1834 by 2pm. The then market rallied back to SPX 1840 by 3:30, dipping late to close at 1838.

For the day the SPX/DOW were +0.60%, and the NDX/NAZ were +0.90%. Bonds gained 5 ticks, Crude added 40 cents, Gold retreated $7, and the USD was higher. Medium term support jumps back to the 1828 and 1779 pivots, with resistance at the 1841 and 1869 pivots. Tomorrow: ADP at 8:15, and the FOMC minutes at 2pm.

The market gapped up again today but this time it held. Once the rally passed SPX 1833 we upgraded the green label to Minute wave a. We can count three waves down from the SPX 1849 high: 1828-1838-1824. The total decline was 25 points, and the C wave had a 0.618 relationship to the A. The positive divergence that formed at the low helped propel the short term count into Minute wave b. Recently, b waves have rallied to within one or two points of the previous high before topping. Then the c wave has kicked in taking the market lower. Something to keep in mind.

Short term support is now at the 1828 pivot and SPX 1814, with resistance at the 1841 pivot and SPX 1849. Short term momentum hit slightly overbought today. The short term OEW charts turned positive early with the reversal level now SPX 1834. Best to your trading the FOMC minutes.

MEDIUM TERM: uptrend

LONG TERM: bull market

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

About tony caldaro

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90 Responses to tuesday update

  1. bobhopium says:

    Busted bearish breakout…happy to be long here with stops at Fake-out low…GL to us all
    Snp cash 15 min.

  2. gary61b says:

    I was thinking a reversal area, at the least a hesitation, what u thinking Lee

    • Lee says:

      I’m thinking the easy $ has been made in CL this year already😉 but it sure looks like 3 waves up on the daily @ 100.50 ish from the Nov low. All I see are 3’s in that dang market

  3. gary61b says:

    Looking for a pop in oil around 92.15-20 level, anyone else anticipating it?

  4. H D says:

    No helicopter? Was this a Yellen FOMC?
    strange market, look at that bait they are using and check ur lines.

  5. bobhopium says:

    Maybe of interest to some.
    These Diamond-esque structures usually resove to the upside (In an uptrend) in my experience, but are prone to false breaks imho…GL to us all.
    S&P cash 15 min

  6. A big decrease in Comments. Seems either to be respect Caldao’s wish or just forget the counts and buy the market. 1 of the 2 . good luck to all trading

  7. cicelyalaska says:

    Tony, it would be interesting if you could put together an analysis and compare the Treasury yield curve and how the stock market acted/reacted over the past 50 years, especially during times when the yield curve went inverted. Just a thought.

    • tony caldaro says:

      Inverted yield curves usually impact the economy within about one year.
      Other than that, with rates rising for 30+ years and then declining for 30+ years do not see how the rest would be of much value.

  8. bobhopium says:

    Leaning bullish myself, but really need to see impulsing to the upside soon or bears will get a handle on this imho.

  9. llerias7 says:

    Tony, by your charts it seems that the Athens índex (ATG) entered in a wave 3 of III…is that so?

  10. $SPX $FB $TNA $UVXY, shortened trading plan for wednesday (within remark’s sect.):

  11. H D says:

    that was 5 hits on 1841 pivot for this wave, my feeling is that would produce a failure, FOMC,,, anything goes.

  12. torehund says:

    Lots of bears here, when market is firmly on autopilot…Set the alarm clocks at 1950..and get into the hammock, dozing to the profits.

  13. scottycj1 says:

    I have had Jan 8th as a strong CIT date for a month now. (these are posted on the site)
    I believe we have seen the high at 1849 for wave 5.
    We are now in a wave 2 retrace from 1824. We could do the .786
    today/tomorrow but then its down. Todays close tells the tale.
    Not going to be a happy new year for some.
    1-8-2014 12:08 ET

  14. Caldaro help me sir follow along. a drop below 1768 will end wave 3 and major 4 should be a 10% decline from what number? 1850? 1768 would be a 5 % which i dont know whats going to get us there. I cannot imagine what has to have to take us to 1650??

  15. RDC if you there is the VIX indicating that this is a simple buy the DIP again? thanks brother

  16. H D says:

    1841 pivot/ yesterdays low should work fine today. GL all.

  17. alexhartley1 says:

    Morning Everyone,

    We had a lower secondary high yesterday in the afternoon. If we start off lower in the early morning we should see a lower low in the afternoon. There should be minor a bottom into the 9th (minute c and minor a complete) I will look to get long 9 – 10th at a support level in the 1800 – 1817 area.

    We then rally into the 15 – 16th top for a minor B and then a drop into a minor c and intermediate 2 bottom around the 24th Jan in the high 1700s low 1800s zone.

    As stated yesterday I look for intermediate waves 3, 4 and 5 to unfold into a Major V Primary III high into Mar14.

    So far so good!

    To be continued…..

  18. 1charlie1 says:

    Hi Tony…..so P I – P II – P III (underway) gonna take about 5 years (2009-2014)…and P IV – P V will last just couple of months….isnt that strange?…thx…

  19. theyenguy says:

    You write Long Term Bull Market and Medium Term Uptrend; this is incorrect.

    The real situation is Long Term Bull Market Complete, therefore Medium Term and Short Term Downtrend, now underway

    For the year 2013, liberalism’s peak fiat wealth came on December 28, 2013, as currency traders drove the Euro, FXE, strongly higher to 136 and the Yen, FXY, lower to 93.

    This was perverse, as earlier, destruction of fiat money had commenced on October 23, 2013, with the a strong sell of Credit, AGG, as well as a strong sell of Major World Currencies, DBV, and Emerging Market currencies, CEW, as the bond vigilantes began to call the Interest Rate on The Ten Year US Note, ^TNX, higher from 2.48%.

    European Financials, EUFN, drove Eurozone Stocks, EZU, to their rally highs, and US Regional Banks, KRE, and the Too Big To Fail Banks, RWW, drove US Stocks, VTI, to their rally highs.

    Thus, strong currency carry investing, seen in a higher Dollar Yen cross, USD/JPY, and in a higher Euro Yen cross, EUR/JPY, together debt trade investing, seen in Junk Bonds, JNK, and Ultra Junk Bonds, UJB, closed 2013 at a six month rally high, which drove World Stocks, VT, Nation Investment EFA, and Global Financials, IXG, to their six month long rally highs, at the end of December 2013, producing Liberalism’s peak wealth.

    Then, an epic reversal in fiat wealth commenced January 2, 2013. Jesus Christ acting in dispensation, that is the administration of all things economic and political, a concept presented by the Apostle Paul in Ephesians 1:10, had begun to PIVOT the world from the paradigm and age of liberalism, into that of authoritarianism, on the death of fiat money, on October 23, 2013, as investors deleveraged out of Credit, AGG, and Currencies, DBV, CEW, on fears that the world central banks’ monetary policies of investment choice and credit stimulus, have crossed the rubicon of sound monetary policy, and have made “money good” investments, such as the Emerging Markets, EEM, bad. And then, He then fully PIVOTED, the world from the paradigm and age of liberalism, into that of authoritarianism, on the death of fiat wealth, that is World Stocks, VT, on January 2, 2013.

    Tuesday January 7, 2013, with the S&P 500, SPY, 0.6%, the Russell 2000, IWM, 0.8%, Regional Banks, KRE, 0.9%, and the European Financials, EUFN, 2.0%, and Greece, GREk, 2.7%, presented a great short selling opportunity emerged, as in a bear market one sells into pips, just like in a bull market one buys into dips.

    For a full presentation of concepts pertaining to Dispensations Economics theory, one might visit here …. http://tinyurl.com/m4xpge3

  20. M1 says:

    A drop below 1768 = your P wave III is over ?
    If so, Target = major wave 4 (10-12% pullback) ?
    A drop below below 1627 = Trouble ?

  21. Anonymous says:

    thanks tony, anyone getting an eery feeling about this, like back in 2013???
    talk about a turnaroudn tuesday. But still the leader TRANNIES => http://bit.ly/1ieTPQX
    It has not gone anywhere, and the ADP report will be the big warm up for the JOB data on friday.

  22. Jennifer says:

    Thanks Tony🙂

    U.S. stocks close high on expectations for solid jobs report:

  23. Tony, What are the odds that actually minor 2 has completed at 1823.73 rather than Minute wave ‘a’ and we are now in Minor 3 of Int 3? One thing I have to point out that today’s XLF weak action might be supporting that it is probably minute wave ‘b’. Thanks.

  24. rc1269 says:

    Thanks Tony

    The credit space has mostly been better offered so far year to date. A flurry of selling into the close today as well, pushing some of the more liquid names a couple bps wider on the day. For the most part, people have been sellers of the higher beta/higher yield names. Accounts and dealers seem choking on bonds. Syndicate desks have been playing their usual games bringing new deals as rich as possible; normally they’ve hung in there once they’ve started trading secondary, but lately stuff is languishing. Priced to perfection and no follow through.


  25. bouraq says:

    Bull flags:
    #SPX #RUT #FTSE #OIL #GOLD #EURUSD #GBPUSD #AUDUSD http://www.tradingchannels.co.uk/2014/01/bull-flags.html

  26. mcmasoniam says:

    Thanks for the Update, Tony.

  27. llerias7 says:

    So we should see a b wave to 1847-1850 and aftwards a dive to 1818 for a final C?

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