friday update

SHORT TERM: consolidation day, DOW -43

Overnight the Asian markets lost 1.4%. Europe opened lower and lost 0.3%. US index futures were higher overnight, but faded heading into the open. At 8:30 the PPI was reported lower: -0.1% v +0.2%. The SPX opened two points below yesterday’s 1846 close, then rallied to 1852 just past 10am. At 10am Consumer sentiment was reported lower: 79.9 v 81.6. The market then declined to SPX 1840 by 11:30 when the FED released this: A rally back to SPX 1852 just before noon followed. Then the market began to drift lower. Just before the close the SPX hit 1840 again, then ended the week at 1841.

For the day the SPX/DOW were -0.25%, and the NDX/NAZ were -0.50%. Bonds gained 1 tick, Crude added 80 cents, Gold rallied $8, and the USD was lower. Medium term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Last night the FED reported an increase in the M1-multiplier: 0.709 v 0.697. Today the WLEI was reported higher: 52.3% v 51.8%.

The market opened a bit lower today, rallied SPX 1852, dropped to a lower 1840, then rallied back to 1852, before retesting 1840 again at the close. Several reversals all in one day does not occur all that often. Most times this is an indication of some sort of short term bottom forming, but not always the case.

Short term support is at the 1841 and 1828 pivots, with resistance at the 1869 pivot and SPX 1884. Short term momentum hit extremely oversold today, then ended with a positive divergence. The short term OEW charts remain negative with the reversal level now SPX 1858. Lots to cover in the weekend update, enjoy you weekend.

MEDIUM TERM: uptrend

LONG TERM: bull market


About tony caldaro

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12 Responses to friday update

  1. Hi Tony

    Wednesday’s price action was not a flat, but developed into a nice a-b-c retracement into Thursday. We went south from there. I see an a-b-c down, terminating around this current level (oversold). Interestingly, we did not get any additional selling today Friday before the weekend (no buying either) – the volume was lighter than yesterday, too.

    I have been calling the low of March 3 minute-4 of the one wave up since the beginning of February: NDX + DOW have now closed below, SPX + NASDAQ not – go figure.

    Short term my indicators point higher: Perhaps it will be a peaceful weekend and we will ramp up / gap up Monday. Bonds point lower for Monday, too.

    • I am not sure how you came up with – “the volume was lighter than yesterday, too.” – since I can see it being higher?

    • I agree, IBM and the tech sector is weakest. A-B-C case, most logical at this point in time. Elliott Wave Oscillator displaying positive divergence on DJ-30, SPX, OEX. Only one of the four major stocks, GM, BA,Ge, and IBM, doesn’t show bullish divergence, that’s IBM.
      Market oversold in my opinion.

    • DJ 30 broke its uptrend channel, Thursday, which implies 15,700 is the next logical target, but early next week, odds favor, DJ 30 will rebound to test 16,300 level first. Transports index is still trending higher, which confirms, bull market is still ongoing, DJ 30 should catch up once it cycles to 15,700

      Thursdays sell off on DJ 30 hurt the short term bullish case, once the uptrend channel was broken.

      Odds favor, DJ 30 should rebound early next week, given its option expiration week.

    • The Federal reserve bank of New York, conducted study, Predictive powers of the famous head and shoulder pattern. P.H. Kevin Chang managed the study. D.J. 30 pull back to 15,700 level will set the stage for inverse head and shoulder pattern. Anyways, good study while Tony prepares his weekend update.

  2. JK1987 says:

    Tony Thanks
    You put c of minor ii at 1820. Is that the target price you are looking for to end minor ii? And then iii of 3 of 3 up to 1910?

    Since DOW is progressing with PRI IV with 15~20% downside target.
    Maybe short DOW with PRI IV with 20% down, and hedge with long SPX for iii of 3 of 3 up with 5% up to 1910?
    What’s the probability of DOW PRI IV?
    What’s the probability of SPX iii of 3 of 3 up after 1820 target met?

    • tony caldaro says:

      As explained in the yet to be released weekend update
      The NDX/NAZ appear to be the best bets for the rest of Primary III.
      They will probably drag the SPX/DOW along with them.

  3. Oex 100 829.33 hourly high 3-7-2014 to 3-12-2014 817.37 low 21 trading hours. Oex made five new lower closes, Matching number. 3-13-2014 high of 825.93 to today’s low, 809.26 could be Y/C 2 Wave!

    Perfect area to get long!

    3-12-2014 low hourly, to Monday first hour of trading, will be another 21 trading hour cycle.

    Alteration: one can expect explosive opening, higher.

    Lets see, what Tony come up with this weekend.
    long McDonald’s from today’s double bottom, $97.043


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