wednesday update

SHORT TERM: sloppy/choppy action continues, DOW +19

Overnight the Asian markets gained 0.2%. Europe opened lower and lost 0.4%. US index futures were higher overnight, and the market gapped up at the open to SPX 1850. The SPX had closed at 1845 yesterday. Right after the opening ticks the market started to pullback. At 10am New home sales were reported higher: 468k v 414k. By 10am the market had hit SPX 1843 and started to rally on that news. By 10:30 the SPX hit yesterday’s high at 1853 and began to pullback again. The pullback lasted the rest of the day with the SPX hitting 1841 just past 3pm, bouncing to 1846, and closing at 1845.

For the day the SPX/DOW were +0.05%, and the NDX/NAZ were mixed. Bonds gained 10 ticks, Crude rallied 65 cents, Gold fell $11, and the USD was higher. Medium term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1884 pivots. Tomorrow: weekly Jobless claims and Durable goods orders at 8:30, then FED chair Yellen reports to the Senate at 10am.

The market gapped up at the open today, but it was immediately filled about 20 minutes into trading. Then after hitting SPX 1843, the market rallied to yesterday’s 1853 high, before dropping to a lower low at 1841. This choppiness has been underway since Monday noon. Prior to Monday, the market rallied in three waves up from SPX 1825 on Thursday, to Monday’s 1859. So one could say the market has actually been choppy since SPX 1825. While we have a couple of short term counts, such as the one on the DOW charts, we have posted a Minor 1 from 1738-1848, a Minute A to 1825, a Minute B to 1859 and now Minute C underway. We have seen an irregular second wave during this bull market before. It ended as a flat. Maybe this one will hit SPX 1825 to form a flat as well.

Short term support remains at the 1841 and 1828 pivots, with resistance at SPX 1851 and SPX 1859. Short term momentum vacillated above/below neutral today ending below. The short term OEW charts got whipped around again today, ending neutral with the reversal at SPX 1845. Best to your trading!

MEDIUM TERM: uptrend probable

LONG TERM: bull market


About tony caldaro

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118 Responses to wednesday update

  1. CygnetNoir says:

    About three times today I was about to post that this was the most boring triple digit rally I’ve ever seen. Few gappers, and none of them bona fide runners That should have had me thinking something was up. And then lookey here … a market top! lol

    Smoke ’em if you got ’em!

  2. budfox9450 says:

    Tony.,..Do you have a view/comment on
    the Medical Marijuana sector? Silly as it
    may appear, seem’s to be a growth sector,
    ie: healthcare…???

  3. Kisshu2 says:

    looks squeezy into close?

  4. rc1269 says:

    i wonder why rates just keep grinding lower
    somebody didn’t get the memo

  5. Hi all, I’m still looking for the DOW to begin to accelerate higher and Naz to lag. 3 of 3 of 3 in play right now, Expecting an upper band crawl for 2-3 weeks in all major indexes as minor 3 continues to unfold. Best of luck to everyone. Target is at least minor III=minor i.

  6. pcskier says:

    Take a look at the emini daily chart as of now we have a lower low and lower high from yesterday. Does it look toppy to your eyes?

  7. JK1987 says:

    Top of chop city.
    Short 1852.6, stop 1854.

  8. torehund says:

    Russia is ramping up its involvement in Ukraine, showing naval muscle. This is what might spook gold and shipping higher near term. Sure I would like a higher high in gold, and a spike might be imminent. Sure it doesn’t have to happen but my AVM is lacking a C-wave to complete the maybe…

  9. pcskier says:

    Is it getting close to the after lunch sell of time(eastern time)?

    • magicianme says:

      When there was a prolonged struggle between 1847 and 1849 and the bears were not getting control I closed my short for a small loss. But I am shorting again at 1856 with a 5 point stop.

      • magicianme says:

        PS: Logic for that is divergences, volume behaviour at this high and well, just the fact that it’s near a high and just under cyclical resistance.

  10. Sorry, for 4th post, but this is last for the day. FYI. Re-shorting SPX is on hold till Tuesday..I think market will be dull till Tuesday…

  11. Last post…

    Some cheap longs at 101.60s and some at 101.80s, in the last few days (SSO)… will add more if 103.70s break to the upside… OR sell all and more, if 101.40s break to the downside. A big move’s coming, maybe next week though, waiting for Russia over the weekend? I am just wondering why the markets couldn’t care less… maybe nothing to worry about…


  12. I stand by what I say in order for this market to get nasty meaning the opposite of going up everyday you almost need a major event to spark fear and even then it does not stay down. very strong while other markets are breaking down

    • tommyboys says:

      This will continue for a while – months/years – as EMM and just about all others will continue finding their way to US markets in leu of their own.

      • tommyboys says:

        This goes for treasuries as well and could keep rates lower longer than previously thought – regardless of QE/no QE.

  13. H D says:

    GM Tony, all, groundhogs day. 10 handles from 10AM. It’s in the update all. :mrgreen:

    • Lee says:

      H D
      Your stats are completely off as I have the 10 handle move starting from 9:00 am. 😛
      March madness right around the corner !

    • CygnetNoir says:

      I remember HD when he was here just starting out, wide-eyed and full of questions … now here is is, all grown up, wise-eyed and schooling us old folks – so proud of you HD!

      • H D says:

        Ha! Whatever. You guys showed me the way. Admittedly did not start out a fan of this wave stuff. Tony’s the best. I owe him a huge debt of gratitude. If they keep giving us 10 handles every morning I could make this my last year…..

        If that was indeed E wave down yesterday and we r up in C, C=A 1875. that is the measured move and the pattern and they are all coiled up. Stats on triangles <50%

      • CygnetNoir says:

        “I could make this my last year…..” I said the same thing to myself … back in 1997 😉
        Like Lee said, lee-tired is a somewhat impermanent state of mind …

    • JK1987 says:

      HD, I am watching and learning from closely on your live blog. 🙂

      if that was indeed E wave down yesterday and we r up in C, C=A 1875. that is the measured move and the pattern. I have had enough of the BS though. It’s time to go down and look it won’t
      by hd 17 minutes ago

      hd’s avatar icon
      yo chartrambler! how many dead bankers now?

      by hd 34 minutes ago
      hd’s avatar icon
      Range 1,841.13 – 1,851.06 do not mess with 10AM, bots

  14. JK1987 says:

    10 handles, 5th round in 3 days for the chop city 1841 – 1851.

  15. pcskier says:

    We are at the bull bear crux, m shape bottom on small charts. We should know real soon

  16. uncle10 says:

    Morn. I like FTEK. Small company trying to help China with its terrible pollution problem. Small cap company that could easily double or triple from here without much downside. Gl to us all.

  17. CygnetNoir says:

    For anyone playing along at home, I still am looking for Gold to continue to the mid to high 1400’s, and I’m still long the miners. A pullback can happen at anytime, of course, and we may or may not be in the beginning of such a pullback. But the trend since the Dec low has been very orderly. For GLD, I would want any pullback to go no deeper than $122ish, and would prefer to see $124-$125.50 find buyers before it ever got as low as $122. $122 because that would be about 50% of the rally and had been resistance in the past, and would want it to be support in the future. $124/$125 because of the recent gap and last intraday pullback low prior to that gap would be an area in which I’d expect to find buyers. Like I said lol 🙂

    CygnetNoir says:
    December 20, 2013 at 9:46 am

    I closed my gold shorts this morning and I am a buyer of both gold futures and miners … First target the mid 1300′s and second target the mid to upper 1400′s.

  18. simpleiam says:

    Eyeing future buys for my Roth:
    IBM at 180 or less. More aggressive is GEOS, which is I would like to see at $70 max.

  19. trondack says:

    What happens if the banks don’t want to sell their Mortgage-backed securities to the Fed? Would this automatically reduce QE?

  20. mjtplayer says:

    FYI: 2nd largest POMO day of Feb today, $3.50 – $4.25b

    2.65% on the 10yr this morning, that’s amazing, not what one would hope to see in an “improving economy”. Economic data over the past 6 weeks has been lousy, only reason I can see that stocks are at highs is expectations of “tapering the taper”. I don’t see it, the Fed is reducing QE another $10b in 3 weeks and a further $10b in April, wonder if the market will be disappointed when it happens?

  21. $CANN in nasdaq bulletin board, buyout and new contract confirmed, closed part of a 2 day trade for 76% return (remarks sect. of blog)

  22. gtoptions says:

    Thanks Tony
    SPY ~ WPP @ 183.81
    Short term momentum has flatlined. Looking for a test of support around 182.50. In the mean time sitting out the chop city. 😉

  23. rc1269 says:

    good thing we got some more bad data to help stocks rally!

    • tommyboys says:

      Good thing news isn’t 100% correlated with markets…

      • rc1269 says:

        tommy- knock that chip off your shoulder. sarcasm my man. and never said ‘news’ last i checked. but whether it’s a ‘good thing’ that markets are not 100% correlated is certainly debatable

      • robnaardin says:

        Good thing I never pay attention to the news.
        Windchill this morning is a good thing for blind squirrels who like frozen nuts..

  24. Thank you guys for putting lots of positive comments on Monday 24th. Some came up with INVERSE H&S with SPX target of 1970s, Some said 2200 for SPX. Some came up with other technical charts with SPX target of 1900s. Some came up with stories of “How we are living in great time”..Some came up with “American Oil independence” theories. Some came up with fracking theories.I wanted to short at 1858.1, but when it touched, I was not around, hence ended up shorting at 1855.9. Technically this position covered now..and I see DOW/SPX rising again..

    • RDC says:

      Giddy up … 🙂

    • bobhopium says:

      …Some displayed a bearish looking chart in their opinion…some are looking for Dow@15510/15530…some are staying with their position…

      • Shorting again at around Janet Yellen speech etc…when she will put another tech chart showing SPX target of 19000 (Oh!! sorry, 1900). She also say that QE was successful in eliminating poverty etc. My guess is Ben realised that no amount of QE qill help REAL economy and thats why he is writing book titled “Why QE no panacea”. Geithner did say that yesterday “saying we saved economy…” once the bad effects of QEs are felt, Geithner will be seen standing in Dole queue.

      • bobhopium says:

        Shirahas..Interesting thnx…yes will be watching for Sellin’ on Yellin.

    • pooch77 says:

      Shrihas,what are your upside projections as of this morning?tia

      • Please dont take my word as final…but about 1848-1850ish that too MAX (for the day) If it turns from 1844-45 then down trend has started. However, if it breaks 1862, then will go for outing..there are good restaurants nearby..if it breaks 1862 tomorrow, then NON STOP Liam Neeson

  25. Hi Tony

    As I’ve been more or less cash waiting for the Primary correction , it looks like markets just does not wanna correct. Also as you expect this bull market to continue to 1900-2000 i’m asking if you think there is any good sectors to invest in until a bull market topping ?

    What is your favourite themes or sectors in the coming 3-6 months?

    Thank you

  26. Eight regular trading hours to get back to zero on the day for the SPX. In between, we had a morning gap up that was sold. New Home Sales to spark a one-hour rally to yesterday’s high, a midday flunk to take us to Monday’s lows, and then a late day Ukraine newsbomb to stem the bleeding. Today’s range of 11 handles was less than yesterday and the day before to setup a consolidation triangle leading into tomorrow’s risk event.

    Outside of equities and their zero percent move, things were rocking. For the last two trading sessions, the ten-year is down a quarter percent while precious metals took a knock on the stronger dollar.

    Yesterday, I speculated on the SPX being in the midst of a minor v or in the ABC portion after a failed v. Yellen’s Capitol Hill testimony could be the catalyst to breakout or breakdown. If that doesn’t break us out of the range, then we have Jobs Friday next week. From the looks of it, up, down or sideways, the big boys have taken their positions.

    • pcskier says:

      Good post. If the Dow 30 can stay below 16174 for a close I think we are breaking down. But the 330 ramp has been saving the day from the after lunch sell off. Perplexing action. Maybe the algo are ping ponging the market here to give them time to unload momentum stocks. If you look at spxs their is positive divergence with ultimate, if it spxs) can get 1 penny above its hammer from a couple of days ago, I think the direction will be determine or if it gets 1 penny below the hammer handle. I love the 3x both directions for charting.

      • pcskier says:

        First taper, surge. Second taper, dive. First yellen congress talk, surge. Second yellen,….,? Maybe we will have symentary.

  27. budfox9450 says:

    Talk About a Rocket Ship Stock…..CANN.
    Check it out….

  28. robnaardin says:

    Thanks Tony

    SPX 4 hr macd says the uptrend from 1738 has lost it’s momo mia.
    C ya below the 89 hour ema.

  29. Tony

    If you don’t mind, I would like to offer a slightly different count and see what you think:

    I also count iii the high on May 22, 2013 at 1687. iv on June 24.

    I differ slightly thereafter:

    wave 1 of v occurred on Sep 19 at 1729
    wave 3 of v occurred on Jan 15 at 1850
    wave 5 of v occurred on Feb 24 at the marginal higher 1858, unfolding as a 5 wave structure.

    DOW is behind in time

    • tony caldaro says:

      That is nearly a possible count to end Major 3.
      If that is what you are thinking.
      But I would count it slightly different: 1710-1627-1851-1738-1859.
      Not counting it that way, but it is possible

  30. Jennifer says:

    Thanks Tony!

    Stocks closed flat before comments from the Fed

  31. blackjak100 says:

    Any short takers like myself on TLSA from these levels? I bet $$$ to donuts that gap down to $217 gets filled sooner than later. Just ask AAPL and their earnings gap

  32. mjtplayer says:

    Hey Tony,

    Looks like the counts are getting pretty “iffy”. Lots of possibilities and it feels like fitting square pegs into round holes on the short-term counts. When one faces these uncertainties on the short-term counts, it’s usually best to step back and look at the intermediate count – per your advice.

    From the major 4 low at SPX 1,627 last Aug, have you concidered 5 int waves up: 1,729 – 1,646 – 1,850 – 1,737 – 1,858 so far? When one steps back, it looks simple enough. I guess the only issue would be the minor & minute waves inside wave 3. But, the short-term waves are a mess under the current count too

  33. lunker1 says:

    from 1859 (Minute C down)
    Micro A down to 1840 = 19pts
    Micro B up to 1853
    Micro C=.62A=1841 (TARGET MET TODAY)
    Micro C=A=1834
    Micro C=1.62A=1822 (BINGO?)
    seen a lot of the C=.62A’s lately.

    from 1847.50 (Minute A down)
    Minute A 23pts
    Minute B 1859
    Minute C=.62A=1845 (NO GOOD)
    Minute C=A=1836
    Minute C=1.62A=1822 (BINGO?)

    got 2 hits on 1822. 😉

  34. As said yesterday, the bonds we starting a minute v. Today’s 5-year auction was dynamite. TNX also turned clearly down today.
    Is this flight to safety or is smart money expecting better QE news?
    The YEN dislocated from the bonds, giving ground to a stronger US dollar. This points more towards flight to safety than QE.
    VIX also up
    Bulls are not convincing …

  35. Rancho says:

    Thanks Tony !

  36. Lee says:

    Thanks homeslice

    • lunker1 says:

      lol. is the veal still on Thursdays? I’ll take the table to right along the wall.

      • Lee says:

        Yes sir Mr. Lunker !

      • Young Tom says:

        The best veal joint in Chicago, and perhaps the whole USA, was a place called Doro’s, 870 N Rush. Long since closed. Northern Italian Cuisine. Believe it or not the general manager was a guy named Jimmy Carter, go figure in an Italian Establishment.

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