tuesday update

SHORT TERM: gap up turnaround Tuesday, DOW +116

Overnight the Asian markets lost 1.3%. Europe opened lower but gained 0.2%. US index futures were higher overnight. At 8:30 Retail sales were reported higher: +0.2% v +0.7%, Export prices were reported higher: +0.3% v +0.1%, but Import prices were lower: -0.1% v 0.0%. The market gapped up at the open to SPX 1827, then began to pullback. At 10am Business inventories were reported higher: +0.4% v +0.7%. The pullback ended around 10am at SPX 1822, and the market started to rally. At 1:30 the FED released  this: http://www.federalreserve.gov/newsevents/press/bcreg/20140114a.htm. The rally continued throughout the day with only 2-3 point pullbacks along the way. Then it closed at the high for the day: SPX 1839.

For the day the SPX/DOW were +0.90%, and the NDX/NAZ were +1.80%. Bonds lost 14 ticks, Crude rose 60 cents, Gold dropped $10, and the USD was higher. Medium term support rises back to the 1828 and 1779 pivots, with resistance at the 1841 and 1869 pivots. Tomorrow: the NY FED and PPI at 8:30, then the FED’s Beige book at 2pm. Also there is Senate testimony from FED director Gibson at 2pm.

The market gapped up at the open today, pulled back a bit, then resumed its rally. Heading into the close the SPX nearly gained all of yesterday’s loss. This morning we posted a tentative Minor 2 label at yesterday’s SPX 1816 low. Next, we would like to see the SPX rise above 1843 to confirm. However, the market is acting as expected off yesterday’s oversold low. So it does look like the market is now rising in a Minor wave 3.

Short term support is the 1828 pivot and SPX 1814, with resistance at the 1841 pivot and SPX 1849. Short term momentum hit slightly overbought and closed there. The short term OEW charts turned positive with the reversal level now SPX 1834. Best to your trading the Beige book!

MEDIUM TERM: uptrend

LONG TERM: bull market

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

About tony caldaro

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143 Responses to tuesday update

  1. gary61b says:

    I was concerned there at the last minutes of the open market that the 5 billion wasn’t going to keep the “meter running” if u will. 🙂 tomorrow retracement if u follow the pomo.

  2. hucky2 says:

    Anybody own Linn energy (line, nasdaq) currently $32, probably headed for $40 this year?
    Opinions welcome.

  3. torehund says:

    Seems like the gold miners have worked on a sustainable bottom, much more agreeable when at the same time oil shows sign of rising; and the softs..well is nobody eating these days.
    Etf DAG is maybe at all times low if one considers the price of the US dollar.

  4. gtoptions says:

    Thanks Tony
    Just finished reading most of the op-ed on the OEW.
    My thoughts and feelings. 😄 😗 😭 😩
    Enjoy the up day😉

  5. fionamargaret says:

  6. Caldaro a couple of questions. When would “Primary IV ” start according to OEW? I am thinkig the numbers will just keep adjusting higher since the market just keeps going higher meaning we are not seeing mid 1600’s and last but not least please give an honest answer based on how short and shallow every correction has been do you continue to give credence to OEW as much as you would have in the past knowing what is driving the market? If a correction happens it will be because of an unforseen event not a wave account would you agree? thank you kindly sir for your input and work

    • budfox9450 says:

      Quite possibly all the good news
      is in the market…

    • tony caldaro says:

      OEW quantifies the significant waves.
      The FED has been feeding these waves with liquidity.
      The waves will still quantify, even if the DOW goes to 100K.
      Last year was an unusual, and somewhat unexpected, event.
      How many times does the US market go up 30% in one year?
      When this uptrend ends, it should end PRI III.
      When PRI IV rolls around it is likely to be accompanied with some economic event.
      The bears will then claim victory, and the bulls will panic.
      Then when PRI V takes the market to new highs.
      The bears will relent, and the bulls will expect the market to go up forever.
      That is probably when it ends.
      Technicals continue to suggest this will all unfold this year.

      • thank you sir for your response. Now it comes to this .When this uptrend ends, it should end PRI III? what happens if market continues this trend for years to come. Why not? it has surprised most. also if the fed is feeding the liquidity are we keeping an OEW count on the fed ? the stock market is human emotion on parade . do you not think sir another year and bears will just give up?

  7. uncle10 says:

    Hey Valunvstr, Careful calling people a fool…… your statement, “Talking only about taxable accounts, I will say that “trading’ the market is an absolute fools game”, makes me think maybe you might be calling the kettle black…. funny how people think if they can’t do something or read that other people can’t do something they “assume” it can’t be done? I can assure you that if you know what you are doing, use good money management, control risk, and take some profits when you have them, you can trade and out perform the market in a very big way with LESS risk.

  8. H D says:

    TTT1, thx, I’m familiar with the sentiment. Again, I don’t understand the economy stuff. It is cyclical though. Perhaps 2008 destroyed an entire generation of investor sentiment. Only evidence will be the charts. GL

  9. New ATH high, minor 2 pretty much confirmed IMHO.

    FYI: Just look at the NYSE’s recent minor 2; http://soulsurferusa.wordpress.com/2014/01/15/nysa-update-minor-2-confirmed-perfect-flat-correction/ a perfect flat correction where (minute) wave c didn’t travel beyond (minute) wave a by much, found support around 10,250 and took off. Text book pattern. Namely flat correction per definition: “Since the first actionary wave, wave A, lacks sufficient downward force to unfold into a full five waves as it does in a zigzag, the B wave reaction seems to inherit this lack of countertrend pressure and, not surprisingly, terminates near the start of wave A. Wave C, in turn, generally terminates just slightly beyond the end of wave A rather than significantly beyond as in zigzags” source: http://www.elliottwave.net/educational/basictenets/basics3.htm

    CLASSIC in this case!!

  10. Lee says:

    gap fill in SPH/ESH from 2013 Globex high
    see ya’s in a few weeks

  11. Whos gonna be holding the bag? If we are in an ending diagonal the target is quick approaching and than boom 1740 in a blink of an eye.

    • pooch77 says:

      You really need to post at Danerics site were its a bear porn site

      • pooch, Thanks for your worthless comment, what did you provide to the blog but a snide comment. I simply stated a possibility, you stated nothing of value.

      • mcmasoniam says:

        “imanewbietrader says:
        January 14, 2014 at 10:51 am
        We will be going down to 1800 by tomorrow riding a 5th wave of C

        pooch77 says:
        January 14, 2014 at 11:02 am
        too much pomo for that to happen

        imanewbietrader says:
        January 14, 2014 at 11:19 am

        newbie, do you remember these posts from yesterday? You stated a technical forecast, but when a different opinion was posted, you gave a very generalized, 1-word sentiment answer as the justification of a technical forecast. That’s worthless. Next time you make such a technical statement, give a technical answer that satisfies the forecast. Thanks.

        Dawg, please leave him be so a squabble doesn’t start and Tony doesn’t have to intervene. Newbie will find out on his own, (you know he will).

      • pooch77 says:

        you been stating the samrthing for 2 months,which is nothing of value

      • pooch77 says:

        Just a bit redundant

      • msmasonian,

        Yes I made a post on Jan 14, that “We will be going down to 1800 by tomorrow riding a 5th wave of C. In this post, although it was inaccurate, it was relevant to technical analysis and was very possible. So I was wrong, it doesn’t mean it was a waste, any possibility is worth posting, and Yes… when I put a technical possiblilty out there and pooch replies ” too much pomo for that” and I reply in capital letters COMPLACENCY, well that’s exactly what complacency is, assuming an outcome will not happen for what ever reason or another is complacency. It easy to come at me the next day and try to make me look stupid, when the possibility I presented didn’t come to fruition, hindsight is 20/20, give me a break I am speaking of actual technical possibilities not just coming here and saying market is gonna crash without targets or including wave counts. Some of you guys act like a bunch of spoiled kids around here, I am the devils advocate around here and its not to fluster or piss anyone off, I am just stating bearish possibilities or counts using technical analysis and some of you cant handle it. Do you guys realize you are being ignorant to a guy who is simply stating technical possibilities?

        • tony caldaro says:

          We are here to express market views.
          Some will be correct, some won’t.
          We are not here to debate the theoretical value of this market. Price is price.
          Nor to attack others for differing views. That’s what makes markets.
          Kindly keep this in mind before hitting the “reply” button.

      • pooch77 says:

        I am with you M,also last week I posted dailys were all imbedded and they normally imbed all January so a bullback of 3-5% very unlikely in January.We had a 1% decline on Monday which I stated Tuesday was probably a full moon low.Last week I also stated bank earning would be good enough to sustain rally which has happened.The only negative I see today are the trannies and that may nothing but consolidation of big gains this week.When the bad job numbers didn’t tank this market then what will?

      • mcmasoniam says:

        It’s okay, Guys. He doesn’t get it. Wasn’t a question of blame. It was that he didn’t quantify his technical forecast. Nevermind.

    • buddyglove says:

      Well it won’t be you will it ?, as I’m pretty sure your’e just a spectator.

  12. mcmasoniam says:

    Can’t help but want to post this, esp. for Bears. “Wash, Rinse & Repeat” is being blogged in more places than here. Okay, gotta go.



  13. mjtplayer says:

    Hey Tony,

    In your opinion – when and where would you short biotech? I know the wave count on the general market needs more time to play out, but given the parabolic rise in IBB, it looks to be the #1 short bet in the next bear market.

    Also, I was looking at your SOX chart last night, have you noticed how close we’re getting to the Jan ’04/Jan ’06/July ’07 tops? Major overhead resistance between $550 – $560 in the SOX, currently $543 – so another 1% – 3% higher before what would appear to be a common-sense short idea. After the Jan ’04 high, the SOX dropped 30% over the next 8 months. After the Jan ’06 high, the SOX dropped 32% over the next 6 months. After the July ’07 high, well, everything crashed. 2014 is also a “2yr tech cycle” year, per your chart, meaning the semi’s need to bottom in 2014, just like 2004, 2006 & 2008. What do you think?

  14. Hi Tony!

    The market action makes me nervous….
    Vix at 12,1 low.
    Is this really a minor 3? Or rather intermediate 5?
    Intermediate 2 took 9 tradingdays. “Minor 2” 8 days. The wave held above SPX 1814 and could theoretically be an intermediate 4.
    There have been lots of short third waves in this bull and strong first waves. The earlier mantra of “failed fifth” seems abandoned.

    If the market passes over SPX 1890, then we are in minor 3 for sure. But will it reach that level?

    Best wishes Sverker

  15. llerias7 says:

    The last minor 3 of this P3 is good to go…all clear….10,9,8,7,…

  16. mjtplayer says:

    Largest POMO day of the month today ($5b+/-) and a full moon, good day for a important inflection point. Also, heavy options/futures open interest surrounding the S&P 1,850 area acting as a magnet into Friday’s expiration.

    Something to note: Over the past several months, the largest POMO days have been preceeded by large up moves – yesterday for example or Dec the after the Fed meeting, where the prior day was the big up move. Looks like traders have been frontrunning the big POMO days, running the market higher the prior day into the large POMO days.

  17. H D says:

    GM Tony, all….SPX gap up above 41 again…. see if it holds 10AM BOT traffic.

    Seems the blog has found some negative energy again. Just from reading over the past years I think EW in general is part of that equation. Either a lack of understanding of EW or a fear of doom, crash etc that seems to resonate with some who practice the theory. Clearly from the Pretcher side of the family IMO.

    • This will be my last post for today. Look lets all be real honest here. This market has been a rocket heading straight up . If you bought every dip and 5 point sell off you made money. If you follow EW and stayed with a bullish mind set EW is amazing. If you have a bearish view you have either missed out or lost money. But I have been around a long time time as have many people here. Nobody can really explain this move but most feel its the fed. Either way if you have been bullish EW has worked great if you have been bearish and using EW it has been terrible. Depends on how your view is. Caldaro seems to have maintained the same view of bullish so he has been right. As for me I like the weekend reviews because I read the long term trends. the med and short term trends really are not valuable. what does a 6 point or 1 day pull back do? do you know how lucky you have be to get that 1 day. Good luck to all

      • H D says:

        Hey TTT1, not stirring the pot but,,, “Mostly likely support is around SPX 1814”
        ya,,, just ignore the Short Term updates😯
        Lucky for me I don’t understand QE or FED – I have been trying to learn some of the economy stuff like jobs but gave up on after reading how people just think its fake #’s. What I don’t get is you guys that say ur old timers and act like you haven’t seen a bull market before and argue every point to this being “unexplainable.”

        How “unexplainable” was the bull market in the 90’s?

        My personal opinion is that the market is perfect in pricing in the economy & it seems to be in a hurry to price in something.

      • mcmasoniam says:

        Thank you, HD!!! Good point. Have these folks ever traded a Bull mkt in their lives? And there’s no such thing as a “fake rally”. A rally is a rally.

      • HD I am sorry for being unclear. Let me explain what I meant. 25 years ago everybody wanted their children to go to school for computers. My first computer was the apple 2e. you had the tech boom. Computers created jobs only to take them away, But it was a boom with something behind it. Most recent the housing boom where most stay at home moms and there are a number in my Old Westbury LI community getting real estate license and making 30 to 40k selling a home. Doing one open house a weekend you could see the bull market but a little insane. My daughter a teacher needs help every month to meet her mortgage bought a cape in a local area for 700k at the top. I get a little concerned when I see home prices that people were unable to afford back then in 2007 back at the same price and the people not making money. You knew the good times would end when the housewives and stay at home moms and knew nothing about realestate only had to say the school district is the best that it would end. I seen 20 year old kids driving around in 100k cars while Doctors who went to medical school and studied waiited to they were 50 to get that car. I dont know where this ends because I have never seen drugs used in a system and dont understand the move in this bull market other than the fed forcing the market higher by giving away the money to spend. I wish well but real world is different and one day the bill comes due.

    • JK1987 says:

      Déjà vu, now Pretcher has the same bullish 1-2 count as Tony, and have no bear count!
      Pretcher has the same count as this guy, first time bullish since 2010.

      I stopped out at 1844. Tony’s b of C count out.

      • budfox9450 says:

        I saw that, too. 3 out 3 of my ewave analyst
        have the same count, is there a message, some

    • tony caldaro says:

      Clearly from the Pretcher side of the family =)
      Bob is actually a really nice guy

    • Lee says:

      “How “unexplainable” was the bull market in the 90′s?”
      It was the best decade ever H D ! You would of LOVED IT !!!
      The $ the market action and order flow the women the parties the $ wait did I already mention that ?
      I’m turning 50 in a few months and celebrated my 18 th B Day @ the old merc on Jackson and Clinton and got hammered downstairs at a Union Station bar after the close that day.
      So I guess I’m really an old timer but I spray tan and wear gold chains to deal with it .


      • H D says:

        THAT’S WHAT I’M TALKING ABOUT! Lee- ur a living legend amigo. Anybody who can juggle oil, an SNL vid and gold chains…. we need more people like that. :mrgreen:

  18. I came across this last night. Probably useless information since he has been right once in 20 years. but it is a good read.


    • rc1269 says:

      it’s obvious we’re in a financial asset bubble. the Fed, through QE, has created inflation. but we don’t have much inflation, at least in the things the Fed measures (CPI). the inflation is in financial assets. so yes, there’s a bubble.
      but like most bubbles it’s pretty clear when it’s happening, but the real question is when is it going to matter?

  19. RDC says:

    I expect SPX to cross 1850 soon then move towards 1910 quickly. Once SPX crosses 1850 VIX will be dead.

  20. Tony, you think we passed the point to confirm uptrend? SPX and DOW?

  21. M1 says:

    Back in 2010 the NAZ retraced abt 38% of the 2009 – 2010 uptrend (a Drop of abt 20%) when it hit 2535 and it was less than 1% below the highs of the wave B of 2008 (An important Resistance)
    Now, the NAZ is abt 2% below the highs of the wave B of 2000 (A more important Resistance).
    You know, I still expect a large pullback. Abt 38% retracement of the NAZ entire bullmarket (a drop of abt 27%). That will take the NAZ below 3100. That means a loss of all 2013 gains and fill that gap at the beginning of 2013.

  22. blackjak100 says:

    I realize the B wave scenario has a low probability even though I’m favoring it because it has the right look now. However no matter how you slice it, it appears a decent trend change is in store rather quickly. Tony has us in a minor 3 of major 5 and I have us in minor 5 of int v of C. Bull or bear, I think we are finally going to get that correction. It’s the depth and structure of the correction which will reveal bull or bear going forward.

    • jparkins10 says:

      I’m on the same count BJ, we’ve finished/just about finished the first wave of minor 5 of int v (not sure about C vs Primary III)…..I think we see a small retrace today in wave 2, maybe to SPX1830-33, then up to 1870 area in wave 3.

      • blackjak100 says:

        I’m seeing 5 waves up from 1816 now. Unsure if it’s just 1 of 5 or all of minor 5. If it’s all of minor 5, it could be a bearish jan OPEX which most have been last 12 years.

  23. bob682 says:

    Thanks for your update Tony. Here’s an SPX setup I’m keeping an eye on if price begins to show weakness again. A large ramp up all through the day in the VXX market pressure and corresponding decline in the SPY market pressure yesterday is waving a flag of caution to me. And we have yet another wedge setup on the VIX.
    Just keeping me cautious on the credentials of yesterday’s move.

  24. 777daimon says:

    On 4 H chart on SPX 500 I see a descending broadening wedge so better watch out!

  25. $TNA $NUGT $TSLA, market update and trades for wednesday (within remarks sect.):
    see the new penny stock watch list section

  26. JK1987 says:

    Déjà vu
    This guy has the same bullish 1-2 count as Tony, and have no bear count!


    • budfox9450 says:

      It is very telling – when Daneric mirrors
      the OEW and other popular EW analyst
      wave patterns…Further, in my view. If
      the SP is up 30%, and earning are up
      only 3% (per Steve Todd) then the
      advance is not fundamentally genuine…

      • rc1269 says:

        has not been since about 1350 IMO

      • ewtoriginal says:

        According to morningstar, that is not true. In yen terms, the earnings are up well over 30%.And if you eliminate reserve accounting or just bring reserves back into earnings, they are up more than that..in yen terms. But I don’t understand this stuff, so like rc, I is gonna keep shortin’. Aint that what long/SHORT means anyway?
        Not really, cause as long as POMO exists, it is the ONLY thing that matters.Just wish my long BP, CLF,DMND and POT would climb more…or at all

      • mcmasoniam says:

        With all due respect… “In yen terms…” This isn’t Japan! Who cares about yen terms, except Dennis Gartman & You, I suppose!

        I have to say, I DO like all this bearishness, as it most likely will continue to push stocks higher. My thanks to all Bears!

    • chrisk44342 says:

      Daneric is calling for cycle B to complete, not III of V.

      • ewtoriginal says:

        McM,My yen terms statement was a joke. It was a play on Gartman-like commentary.I AGREE with Bud (and Steve Todd) that earnings havent been nearly as explosive as the run-up and that is why POMO and the yen slam carry trade are important. I wont comment on using me as a barometer,but GL.

      • mcmasoniam says:

        LOL! Understood ewt. Thanks!

  27. valunvstr says:

    While I do not own any Oakmark Funds, and yes an investor can kill Nygren for owning WM, his long terms numbers are still very good and the message in the article below is a very good one. But, of course, the bears will say, “This time it’s different”.


    • budfox9450 says:

      Sorry, but what Bears are
      you referring too?

      • Most people here were bearish after Monday Close. Everybody was telling Tony, you sure we are on Int iii, looks like a PIV, or at least a major 4…

        I am assuming your indicator now says buy?

      • valunvstr says:

        You’re simply getting sucked into the typical bear trap if you think that “investors” are all bullish and no bears are left. I’ve been in the business for around 17 years and deal with those that handle investors money. They like stocks today more than five years ago but anyone who thinks the “exuberance” that exists at tops exists today is fooling themselves. You can read all the AAII reports among others that you would like and maybe, just maybe, that has “some” predictive power over the short run but I will repeat myself again, if an investor is trying to avoid 5%-10% corrections and thinks they can do it often enough to produce better than market returns, it’s a fools game. And, if one is trying to avoid the “big one” I hope they are using more than “wave counts”. Remember, you also have to be right TWICE. EWT proved it’s easier to be right once than twice, still sitting this market out since 1200. I was wrong saying he/she missed 50%. Actually missed 60%+ (even if short for part of the bear market)

    • mmmiiikkkeee says:

      Why do you post here? Please start a web-site of your own.

      • valunvstr says:

        For the same reason everyone else does, to share insights and opinions that can help other investors. Some share opinions based on EW. I share based on other technical analysis as well as generally sharing thoughts as to why and how the average investor regularly hurts themselves with pre conceived conclusion and short term trading.

  28. mcmasoniam says:

    After viewing the video, look at the interesting and humorous comments on The Fed, etc.
    Have a great evening, All!

  29. ewtoriginal says:

    Baltic Dry in mad collapse…40% lower…QE only works in manipulating stock prices and psychology..Crashes or large retracements to TRUE fair value in equities come when real money is needed to maintain price levels.Believe whatever you want to believe. Take Bill Nygren, 5 star PM at Oakmark Fund, a true “value” guy. I’m a value investor too. In 2008, I bought WAMU after the 75% collapse that Nygren owned as his biggest long throughout 2006-8.Balance sheet looked “great”, I lost 100% in 2 days from 2.50 to zero literally overnight. Nygren somehow saved face.They ALWAYS forget. So, as long as the Fed is in there providing the source of funds, all will be well. But as soon as they conclude, make ABSOLUTELY no mistake about it, this market goes to fair…at 1100 or so.

    • budfox9450 says:

      I am in agreement with your

    • I agree with you EWT, very much so. The expansion and contraction of the money supply and credit determines bull and bear markets above all else, and for heaven’s sake the money supply and credit have been distorted so far from reality. Every time this happens people say it won’t change the market, but it always does. The market will have to price in a tightening supply and it has done nothing of the sort yet. This may be the bear market that finally makes stocks the most hated asset they need to be to start the next secular bull. Why does the mahjority think this time is different when it’s all been done before? (rhetorical question of course. they always do.)

      • tommyboys says:

        ‘If’ you believe this is a cyclical bull. I believe its a secular bull. This may be where bullish and bearish views have their origin. One will be proven wrong – if not already.

      • valunvstr says:

        you are spot on. can 2009 be the bear market bottom 1974 was while 2014-2016 ends up being the 1980 recession/bear market. That led to a 29.5% decline (in price, not including dividends) and then the market was off. Most say the bull market began in 1982 but it was really 1974. 1937 was really the bottom (only WWII threw in a wrench). Interestingly for anyone who is up for historical comparisons…
        1929-1937= 8 years
        1966-1974= 8 years
        2000-2009= 9 years

        The real similarity, if there is one, is how long a bear market takes to make it’s “low”. Not when you take out the old high without ever revisiting it. This bear market actually fits perfectly with the prior two.

    • valunvstr says:

      Nothing like injecting emotion into debate. And no basing conclusions on actual fact. If QE was “manipulating” stock prices then why are earnings for this year at $120 which leads the market to currently have a forward PE of a touch over 15x’s?? I am not a big believer in timing markets due to valuations and PE’s, not in a vacuum at least as many do but if QE was just liquidity running stock prices up how have earnings risen so much? Oh, right, it’s all cost cutting. Stay in cash. Sure you have been for the last 40% of this move.

      • budfox9450 says:

        You may need to relax, take
        a vacation to Key West, of Bahamas.

      • lunker1 says:

        +1 Valu

      • ewtoriginal says:

        Oh. I didnt see the $120 earnings print yet. Thank god you did. I’m sure you stayed long all the way down in 2008/9 while I killed it being short.Then had a nice ride up to 1200 and killed it again. Been long/short balanced since and not hating myself over it. Leaning much more short now with option positions.How were feeling in Oct 2008? Oh yeah, thats right.

      • Hi Tommy,
        I’ve thought a lot about whether this may be the start of a secular bull, and maybe it is, but that doesn’t preclude a cyclical bear market. 1974 was the bottom of the last secular bear, but I wouldn’t exactly say the secular bull market started at that particular point, know what I mean? Why can’t both ideas be true, say for example that we are in the early stages of a secular bull market but are getting close to a stiff cyclical bear? I look at 2011 as really being a small bear market in and of itself, perhaps akin to 1978. Maybe the next bear will be another small 20%er? That would lend much support to the idea the secular bear is ending (or ended, depending on one’s point of view). Still, it is what it is and will be a buying opp. But it will very likely be lower than here. Contracting money supply and credit along with worldwide slowdowns are not exactly bullish in the immediate future.

      • valunvstr says:

        Hate to tell you, ewt, but if you were short the ENTIRE way down, which I bet you didn’t hit 1576 and buy 667 and you rode it back to 1200, you are still behind me my friend. You missed the 50%+. That is some awesome market timing. And since 5 times’s standard deviation events happen once every 30 years, you keep holding onto that dream that you will catch the next one which makes missing the last 50% worth it.

      • Lee says:

        You guys are killing me !
        I guess money doesn’t buy happiness on internet blogs.
        I’d love to share some stories how money bought me happiness in certain situations but Tony sez this is a family blog .

      • mcmasoniam says:

        LOL! Wa, Wa, WAAAAA!!! Boys in the Treehouse Club having a tiff? No Squabbling, or Cry Babies! This volatility will continue for a long time…


    • valunvstr says:

      If you really want to make sense of this market then just follow the waves. We are in A of 1 of 5 of C or X of 3 of 2 of B of Major 1. Got it?

      • The market will do what it’s going to do. In the meantime why not share a few ideas with everyone?

      • ewtoriginal says:

        Valuvstr, In deference to all I will make my final comment to you on this given that you refuse to tell me how you were likely on your knees looking to the skies for months in late 2008/early 2009. You should stick to Kiplinger’s for two reasons. 1. You clearly have no understanding of the plethora of methods to trade serious option positions.That discussion is hours long,especially starting with someone is clearly not versed at all
        2. You always do not know simple math. From the peak in 2007 at 1500 or so, the spx is up 350 or 23% or so. Someone short,in unleveraged positions, from 1500 down to 700 and long from 700 to 1200 is behind you? And that doesnt account for the long/short one might keep.
        Larry Robbins blew up his accounts in 2008,down 50%. Now he is up 80% as his methodology is high beta.You like that? Most would prefer Och-Ziffs little drawdown, but consistent 12% annual returns. You should look into that. It would suit you better rather reading Kiplingers or listening to Birinyi. Over from my end and apologies to Tony and all.

    • tommyboys says:

      If you really believe that then you should be all in long taking advantage of the Fed’s assistance. I believe SP may never see 1100 again although in a big bear 3 – 7 years from now I suppose its possible – but I still doubt it. If ya can’t beat’em – join’em!

    • valunvstr says:

      Hi Two,

      Ok, I will share some ideas. 5x’s standard deviation events happen once every 25-30 years so those waiting for it to happen again in the near future (and some who have not been long since 1200) are fooling themselves, or at the very least basing future investment results on a losing strategy. Talking only about taxable accounts, I will say that “trading’ the market is an absolute fools game. After paying short term capital gains, one has to nearly double to more than double the markets returns over the long term for the taxes to make any sense. So, if “timing” the market is going to work at all, one needs to find a pattern that seems to repeat itself at MAJOR market tops. To have an “opinion” or where the market will or should be is also a losing bet. So, what can be done to protect against major market declines? I would, again, argue to look for repeatable patterns. EG. IF Weekly TRIX, % of stocks trading above their moving average, RSI, etc in an overwhelming majority form bearish divergences along with a large pick up in volatility (ATR more so than VIX) and a breakdown in breath indicators all occur then a major market top has a very high chance of occurring. And I mean a bear market top. Not even a 1997, 1998, 2010, or 2011 style bull market corrections. Even in those cases however most of the above conditions were met, but not all. There are also some other indicators like what Robert Lamy follows that have accurately predicted bull to bear and vice versa inflection points within two months of the tops and bottoms since 1966. They are based on economic and fundamental indicators and has been 80-90% accurate in in and out of sample time periods. So, when combining mulitple measures and patterns you can provide a more robust model of predicting market bottoms and tops. But guessing price points based on time and price (fib or otherwise) only works in retrospect. Anyone can put a number or letter on a bottom or top after the pattern is complete. It has no predictive power. So, nothing is full proof. But what doesn’t work, in a REPEATABLE pattern over the long run, is having an opinion of where the market will be and should be based on QE or lack thereof or any other indicator. That’s why ewt hasn’t been long the market since 1200. What a shame but typical of most investors. Good luck

    • valunvstr says:

      You are a fool. Making assumptions about someone else’s portfolio is a shows how childish you are and probably how frustrated you are sitting out the last 60% of this move. I’ve been in the business a long time. I know all about options (have traded them) and other complex instruments. But how do you know my portfolio isn’t YAFFX, POAGX and ARTKX??? Wow, I’d be POUNDING you into the ground and wouldn’t have had to worry day to day about “timing” the market. Careful about assumptions.

  30. JK1987 says:

    I am sorry to say “look like a Minor wave 3” did not convince me because DOW did not make it to 16400, only retraced a weaker 38%.
    Took 10 SPX points long profits into the close, and switched to the short side with stop of 1844.
    Did you post today’s rally was b of C, and with c of C down to come?🙂
    Let’s bring the MIL indicator.🙂

  31. bouraq says:

    Yo-yo !

  32. Lee says:

    Not bad for a Brooklynite😉

  33. mcmasoniam says:

    Thanks Tony! Have a great evening.

  34. BAD NEWS coming! Gap Down 20 points on SPX, 1800 before 1840

  35. blackjak100 says:

    Thanks tony!

    Yesterday I posted a bull market top in the range of 1860-1890. I have not calculated any target other than saying max upside would be 1892 to fit EW rules.

    FWIW, The greAt Gann god Jeff cooper posted in his free article today 1865 vibrates off the 10/9 low and could signify a major turning point.

  36. micheletonon68 says:

    Tony, am i wrong or there was a similar pattern the first week of October?

  37. gtoptions says:

    Thanks Tony
    10/30 ~ 11/8 repeat still on track! 😉

  38. Paul Hudlass says:

    Hi Tony,

    Since the tentative Minor 2 didn’t overlap Intermediate i (1813.55), what’s the possibility of 1815.52 being a tentative Intermediate 4?

    What would be the price action required to confirm one way or the other?


  39. blubrd67 says:

    Tony, at this point you are giving more probability that we are in minor 3, rather than b of C of minor 2?

  40. M1 says:

    Tony, where can I get a cristal ball like yours ?

      • The Law of One is interesting. Reminds me of the teachings of Ken Wilber I studied a few years ago, particularly the idea of humanity’s evolution on earth from a successful but limited third stage culture and philosophy to a fourth stage one that is not quite perfected yet. I’ve often thought this change is being reflected in the worldwide decline of dualistic religions, particularly in the west, and the rise of new philosophies that have yet to become the dominant framework for society, Have you ever read Ken Wilber Tony?

      • We are privileged to live in interesting times of transition. A time where the old dominance of making things is giving way to the information age and the free flow of ideas. To be followed I imagine by an age where information is transcended and something new will begin. It would be nice to study such things again. Could you make a recommendation of where to begin?

        • tony caldaro says:

          Yes we are.
          Unfortunately I am not avid reader, so have not read any books specific to the transition.
          It is generally shrouded in mystery, if you know what I mean.
          Futuristic forecasts are simply potential paths. There are many potential paths.
          Our choices, as a species, will determine the path we take.
          But one thing is certain, on this planet negativity will nearly cease to exist over time.
          The transition is from a mixed 3D planet, in to a positive 4D.

      • Thank you Tony, I wholeheartedly agree.

  41. Tony

    Could your 1 be iii and your 2 be iv (no overlap with i) and now heading north with a v to complete this wave (5 of III) – what do you think?

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