weekend update


The week started off well enough with a rally to within two points of the SPX 1884 all time high by Tuesday. Then weakening upside momentum and the continuous slide in the NAZ (down 6 of the last 7 days) helped take the market down for the rest of the week. For the week the SPX/DOW lost 2.20%, the NDX/NAZ lost 2.05%, and the DJ World index lost 2.40%. Economic reports for the week were good: seven positive to three negative. On the uptick: wholesale/business inventories, retail sales, export prices, the M1-multiplier, the WLEI, and weekly jobless claims were lower. On the downtick: import prices, the PPI and consumer sentiment. Next week is FOMC week: with Industrial production, housing and options expirations. Could be a wild one.

LONG TERM: bull market

For the past several months we have had a difficult time tracking this bull market. Prior to that, and up until the summer of 2013, the four major indices (SPX/DOW/NDX/NAZ) were rising relatively in unison. The cyclical DOW was the first index to deviate from the general market pattern. This put the cyclical/growth hybrid SPX pattern in the middle of the cyclical DOW and the growth NAZ/NDX. Several times we thought Primary III was topping because of the DOW pattern. And, several times we were wrong.

Tracking four separate market indices objectively, becomes difficult when three of the indices are displaying different wave patterns. In the end, or likely before during Primary wave IV, they will all realign into the Primary wave V high. We have called this phenomenon a trifurcation. Please note, all of these indices are still in bull markets. Just their respective wave patterns are different.

The SPX is the index most follow, so we follow it as well. Despite this week’s decline the most obvious count still appears to be an Intermediate wave iii, of Major wave 5, uptrend. The SPX recently made all time new highs by about 2%.


The DOW, which as you know we prefer to track, displays a potentially different pattern. Not only has it not made new highs, this uptrend has not even reached the all time high set in December. The most obvious count here is that the DOW completed Primary III in December, and has entered a wide trading range while the SPX/NDX/NAZ complete their Primary wave III. We highlighted a similar potential trading range pattern that occurred in 2004. There are other counts, but this is the most obvious.


The NAZ represents the growth sector, and it is in a completely different count than either the SPX or DOW. Currently it is in Minor wave 5, of Intermediate wave iii, of Major wave 3, of Primary III. When the current uptrend concludes it will end Int. iii. Then it will still have two more uptrends to end Primary III: Int. v ending Major 3, and then Major 5.


Of these three indices, clearly the NAZ is the most bullish until its Primary III ends. The SPX is also bullish, but the DOW is potentially neutral. Obviously, for an investor/trader, it is much easier just to track one index. We do not have that luxury as we track more than thirty. We repeat, however, despite the current the different counts we are still in a bull market.

MEDIUM TERM: uptrend

From the early February downtrend low at SPX 1738 we have been counting this uptrend as Intermediate wave iii of Major wave 5. At that Intermediate wave ii low we had a RSI positive divergence, and an oversold MACD. After the initial surge off that low, which was quite impulsive, the SPX rallied to a new high at 1868. Then it pulled back to SPX 1834, before rallying quite strongly to another new high at 1884. This week that second rally was nearly completely retraced. It was fully retraced in the DOW/NDX.

We initially counted the SPX 1868 high as Minor wave 1, and the 1834 low as Minor 2. Then we thought, Minor 3 was underway with the rally to higher highs. The negative daily RSI divergences in all four major indices, however, took hold at the new highs and the market pulled back. The most obvious count in the SPX now appears that Minor wave 2 is unfolding in an irregular pattern: 1834-1886-1840 thus far.


A retest of SPX 1834 would complete a bullish irregular flat. A further decline to SPX 1825, the beginning of that Minute iv triangle, would create an irregular zigzag. Either one works, as well as, even a failed flat: where the C wave does not reach the A wave low. Currently the daily RSI is oversold, which also occurred during Minor 2 of the last uptrend. In fact, all four major indices are similarly oversold. Next week should put this market to the test. Medium term support is at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots.


Short term support is at the 1841 and 1828 pivots, with resistance at the 1869 pivot and SPX 1884. Short term momentum ended the week with a positive divergence. The short term OEW charts are negative with the reversal level now SPX 1858.


The hourly chart displays a somewhat choppy pattern, between SPX 1825 and 1884, after the initial two week surge of this uptrend. The triangular Minute wave iv is an acceptable pattern, but it can also be counted as corrective. Which would make the entire uptrend corrective, like some sort of B wave. For now, the 1841 pivot range is providing support. Should this give way and the SPX enter the 1828 pivot range, then break through that, the B wave uptrend scenario would definitely gain in probability. This week should be the tell.


The Asian markets were mostly lower on the week losing 2.0%.

The European markets were all lower losing 2.6%.

The Commodity equity group were all lower as well losing 3.9%.

The DJ World index is still uptrending but lost 2.4%.


Bonds remain in a downtrend losing 0.6%.

Crude appears to be downtrending losing 3.6%.

Gold shrugged off the negative divergence and resumed its uptrend gaining 3.2%.

The USD remains in a downtrend and lost 0.6% on the week.


Monday: the NY FED at 8:30, Capacity utilization at 9:15, then the NAHB housing index at 10am. Tuesday: Housing starts, Building permits and the CPI. Wednesday: the Current account deficit and the FOMC ends it meeting. Thursday: weekly Jobless claims, existing Home sales, the Philly FED and Leading indicators. Friday: Options expiration. There will be a press conference on Wednesday at 2:30 with FED chair Yellen. On Friday: FED governor Stein gives a speech after the market close. Best to your weekend and week!

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

About tony caldaro

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130 Responses to weekend update

  1. uncle10 says:

    Afternoon. Futures roll this week. Opex exp. and fed meeting….. keep all hands and feet inside the vehicle its going to be wild…… gl to us all- we are going to need it! hahahha

  2. magnus1234 says:

    Regardless of int ii or minute 2 odds still favour for a gain. I added to my longs this morning. Key for me is SPX @ 1874. /ES, /TF, /NQ and /YM all playing along together with Europe. Breadth possitve.

  3. manunidhi21 says:

    Namaste Tony !

    Its getting very confusing. Dow, Spx and Naz when you are putting that c there on Spx.
    How much you think Russia can hurt or how much Russia will get hurt when they plan to take out money.

    • SPXU Hourly, 3-11-2014 Low $55.54 to $59.37 High on 3-14-2014 appears impulsive, 21 trading hour cycle. Match. Elliott Wave Oscillator, confirmed the higher move on hourly time frame. -.11 reading to 1.78 high reading on 3-14

      Might go long SPXU, 10:00 A.M. Low on 3-13-2014 to today’s close will be 20 trading hours, Tuesdays, first hour of trading, 21 trading hour. Match!

      Today, breath numbers favor the upside.

      Will be monitoring the last hour of trading today, eyeing, SPXU for Tuesday.


      • SPXU hourly Elliott Wave Oscillator, reading at .54 currently, Price at $57.64

        Once Elliott Wave Oscillator hits 0.00 most likely will confirm three wave pullback.

        Time target: last hour of trading today, Might go long SPXU in the next 3 to 4 trading hours.

    • tony caldaro says:

      Crimea is an interesting situation.
      When they were ruled by Russian puppets they had no problem being part of the Ukraine.
      Now with that likely over, the Russians there want the homeland umbrella again.
      Since it is barely connected by land to the Ukraine, and Russia needs that strategic port.
      Think the West should negotiate with the Ukraine gov’t, after they have new elections, to allow Crimea to spin off to Russia if desired.
      When that time arrives, there should be an internal peace force sent to Crimea, and Russia’s military should leave.
      Then the Crimean’s should have a new referendum to spin off or remain.
      This of course would take months to unfold, but it appears logical from this outsiders perspective.
      In the mean time there will probably be a lot of saber rattling.

      • manunidhi21 says:

        True Tony !
        Everything is based on power and money..that port is very strategic for Russia.
        Only worry is Russian Stock Markets whose movement can shake its economy.

        In 2008- USA, 2010-12- Europe, 2014- Russia and 2015/16- Asia.
        are you able to square this query ?

        • tony caldaro says:

          Have been expecting the Russian Rigged Roulette Trading System to retest the 2009 lows this decade.
          Has been in a bear market since 2011, like Brazil.
          The USA has seen its low, most other world indices have not

  4. pooch77 says:

    RUT 2k fading

  5. mjtplayer says:

    Hey Tony,

    Is the USD gonna hold 79? The Dollar looks terrible, downtrending since last July at 85, but coming into the 79 area where there’s very strong support. Perhaps another $10b of tapering Wed gives the Dollar the kick in the pants it needs to get going?

  6. mjtplayer says:

    Oversold conditions gone with today’s big gap-up, resistance around 1,870 to build a potential right shoulder on the S&P. Neckline at 1,840, a break below projects 1,780 – 1,800 S&P.

    Fed Wednesday, another $10b of tapering is the concensus, dropping QE to $55b/mo.

    VIX has been acting as expected, last week we eclipsed the highs of a couple weeks ago of the mid 16’s, high last week of near 18. This week should be low VIX, next week business picks up slightly but the fireworks really begin in 2 weeks. The last week of March/first 2 weeks of April, expect the VIX to test the 20/21 resistance at minimum, a break above sends the VIX to 24-26.

    • Balance of Power indicator by TC2000 is not confirming this NYSE move higher today, matter of fact, Fridays BOP reading was +18 vs today’s -3 reading.. Large spread.

      Similar to the 1-13-2014 when NYSE move higher to 10,373.99 then, reversed the next day to 10,241.32

      Keep tight stop loss! TSV and BOP which are two indicators, not confirming this higher move today.

      GL just my observations..

  7. gtoptions says:

    Thanks Tony, great weekend update. Still Bullish. 😉
    SPY~ WPP @ 185.94 (Hit)
    50.0% ~ 186.72 (Hit)
    61.8% ~ 187.26

  8. Lee says:

    Where’d everybody go ? SPX caught up to it’s MA’s on the 60 minute and Daily pretty quick, I see Tony has put in a ?C so far
    Cheap short here ?

    • 16golfer says:

      Squeeze baby squeeze.

      • Lee says:

        It gave everyone and out or in last night , but yes it’s giving “free” hugs today golfer 😉
        thats 3# adios !

    • Lee says:

      pretty tame in CL considering the ES and GC moves, go figure :/
      Hey RDC nice call last nite
      Ltr guys

    • tony caldaro says:

      do not think most were expecting this Lee

    • RDC says:

      crossed 1850 .. so it is very bullish right now … new high is expected soon

    • JK1987 says:

      Agreed, short here 1860 (hod was 1862.3).
      Funny that you always say cheap short, saw your cheap short comments throughout the entire 2013, now last into 2014. Never saw you post of cheap long.

      • Lee says:

        Hey JK

        Oh ur def right about my cheap short calls as I counter trade the current trend, it’s an “art” and u must use stops I think my last cheap long call was in fall of 2012 @ 1334 SPX
        GL JK !

      • JK1987 says:

        Yo Lee
        I always use stop.
        I save and keep track of all your “cheap shorts” posts throughout the entire 2013, now tracking 2014. That’s why I said I know all your posted positions. 🙂

      • Lee says:

        You’re kind of freaking me out JK but go ahead as I give up any privacy when I post here.
        I’ve seen some of ur “investigative ‘ work with H D so let’s just say u have a margin for error at times.
        I don’t bother looking up ur past comments but I’m sure I can find at least a couple of “interesting” ones if I did.
        You’re the new man JK !

      • …as I counter trade the current trend, it’s an “art” – It’s an art to do all the heavy lifting rather than let the market do it for you. Interesting 🙂

      • jeffbalin says:

        What I’m trying to figure out is how the hell you even have time to trade, when you’re spending all day and night copying and pasting and organizing and analyzing everyone’s comments in some massive diary you’re keeping. You could not possibly have a job. You really could be considered a ‘Blog Stalker’ and could be arrested.

      • Lee says:

        Hey tradersmart321

        Indeed and u have to be self loathing also
        I traded in the futures pit and I was a scalper and often took the other side of the incoming paper or front ran stuff haha for what u guys would call squiggles on some decent but not huge size.
        Nice seeing u back here

      • JK1987 says:

        I only keep track certain posters after market closed.
        Lee was “very nice” to me on his posts, so I like to reward him with additional close relationship.

        Covered shorts here 1853 with 7 points gain, switch to long.
        Down from 1862 is corrective 3 waves.

      • You wanna know someone? check out their friends!

    • NYSE +105.58 but the Elliott Wave Oscillator only hit +135.15 Fridays reading was + 163.34

      TSV isn’t moving higher either, 19 dma is still trending lower, Time segmented volume, hinting NYSE and DJ 30 will move lower in the coming weeks ahead. DJ 30 15,700 is my prediction.

      Today action, short covering on low volume.

      Price follows Volume is the principle rule.


  9. blackjak100 says:

    Watching a possible ED in gold with waves 1 & 2 complete. They subdivide perfectly as 3’s as required by EW rules. Need to see wave 3 complete $1395-$1400 to have even more confidence. It looks like this ED should complete tomorrow at fib day 54 from $1182 @ $1400-$1410.

  10. Hope everyone had a plan coming into the short trade, if you were short before this am. My plan was/is: Scale into position — meaning I am not 100% aboard the short train, 50% as of this writing. I knew we had much resistance to turn this market south (mentioned the areas on Saturday), which is why I am scaling into the position. So, the market is up this morning. NO BIG DEAL. Here is why: I bought a 2XETF bear (SDS). In the pre-market, likely — (will watch what price does at 8:00 am — I’l hedge my short by buying a 3XETF (TNA). I’ll then watch support on SDS to decide whether to dump it — not ready to just dump it in pre-market like last week. That trade was the right thing to do because of where price was — and ended up making profit (small) on that switch. It is now different based on short-term indicators I use. This a.m. may just be a gap-and-fill vs. gap-and-go. I’ll watch what individual stocks are doing in the market to also help me decide … and my short-term indicators. ALWAYS have a plan and train your brain to flip-the-switch if needed. Never let yourself lose much — no need for it unless you are a stock speculator — then the up’s and down’s are big (not for my stomach).

    Good luck all.

  11. Lee says:

    Trade well, taxes due next month 🙂

  12. RDC says:

    Monday starts with huge Gap-Up. Giddy-Up.

  13. opader says:

    Thx Tony …. My thoughts:
    Once Again Doom And Gloom Is Abound …. Another Buying Opportunity

  14. NYSE on hourly time frame, wave A completed at 10,429.61 at 8 trading hours, Wave B traveled higher to 10,513.65 on 3-11-2014 then, Wave 1 of potential C traveled to 10,344.37 at 21 trading hours from 3-7-2014 Highs. Another matching number. Then, Wave 2 of C higher to 10,453.82 then Wave 3 of C ending at 10,275,05 on 34 trading hour, from 3-7-2014 high. Matching number! Then, NYSE over the next 7 trading hours, either completed final tail of C wave, or its still ongoing.

    Overlapping of 7 trading hours, is not impulse structure per say, only other way to look at this NYSE structure, is its A-B-C-D-E pattern

    Given, high $CPOE reading of .69 on Friday close, short term trading index high reading of 1.43

    The market may have reached turning point bottom, Mergent Div 50 index signaled Buy signal on Friday, Signaling smart money flow entering safer dividend stocks.

    NYSE hourly, has produced positive divergence, on Elliott Wave Oscillator, at the 34 trading low of NYSE at 10,275.05 Elliott Wave Oscillator reading was at -121.11 vs Friday hourly close of -93.28

    Signaling, the 7 trading hours, most likely is start of new wave higher!

    Many traders use 3,5,7 Rule , for more detail summary, just google at Tradethemarkets on you tube, educational videos.

    NYSE has pull back now six trading days, applying 3,5,7 Rule Monday, will be seventh trading, which should produce rebound. Based of 3,5,7 Rule theory. Basically, Tonys Analysis, hit the nail on the head, Markets are testing supports levels.

    I’m long McDonald’s at $97.043 as of Friday, Monday, McDonald’s payout $.81 per share to shareholder on record as 3-04-2014

    GL enjoy the weekend!

    • Hi Amos, I agree. I see abc down, abc b wave up, and ab with c wave underway down to complete the pattern, probably tomorrow. I’m seeing this in all indexes, but it is most evident in RUT and NDX. Biggest question in my mind is whether this was all an A wave and we are going to get a B wave retracement of 50% of the decline or so before a bigger washout, or will the market go to new highs this week. I would give 60% chance of new highs and 40% chance this was all the A wave so far. Either way it should be higher a few days from now.

      Options expy, who has the biggest target on their backs? At this moment I would say it’s bears who chased the decline short, but a lot can happen in the next few days.

      • 100% agree! I use Elliott Wave Oscillator on five minute time frame, McDonald’s price chart following perfectly on five minute, trade set up, that might pan out on Monday.

        NYSE on daily, Elliott Wave Oscillator, at 163.34 mark, return to zero level maybe in the future? Unclear at this point in time. Clearly, Oscillator on Daily time frame, pin pointed three wave pattern, from 1-21-2014 to 2-3-2014 Equity CPOE reached .71 at the lows on Feb 3. Only positive short term, signal is on 10 minute oscillator for NYSE.

        Added that one minute time frame, suggest, NYSE ready to move higher.


        How to use Elliott Wave Oscillator, to help, short term trades.


  15. 777daimon says:

    Military truce agreed between Ukraine and Russia today.
    Might see an unexpected gap up on Monday markets considering also RSI (5) positive divergence highlighted by Tony.

  16. bhupal777 says:

    Tony, As I posted a question here last week, I still believe that what you had projected in January is still playing out. That is PRI III has ended around 1850 and we are already in PRI IV. After wave A of PRI IV at 1738 the rally was very swift and it retraced more than 100 points in 1 month. As per EW principles I am leaning towards that rally being a B wave. So I think we are already in C wave of PRI IV. It looks like an extended flat or might turn into an irregular flat. So I am thinking downside target is 1740. Which is very close to A = C. That would touch 30 week SMA and might bounce from there. During this whole bull at market multiple instances 30 Week SMA has acted as nice support.
    As other bloggers posted here if this is a Major 4 of PRI III still 1740 is the downside projection.

    But as you laid out if 1883 is taken out we are in INT 3 of Major 5. So I am not going to enter any long positions until 1883 is taken out and going to tighten stops for my existing longs. In fact around 1860-70 if rally looks weak then it might provide a great shorting opportunity. Thanks for such a great informative week end update.

    • tony caldaro says:

      Some pretty good traders are short this market.
      A downtrend in the NAZ/NDX, taking the SPX/DOW with them, would not be too surprising.
      SPX 1740, however, seems to be too popular a level.
      Then again this downdraft may be nothing more than the end of a second wave.
      So it makes sense to see how it plays out first.

    • I agree, 1740 looks like a good pivot level to me and I’ll probably be buying stocks at that point. GL to all.

    • simpleiam says:

      Hi Folks!

      Almost 4 days in hospital, fighting illness, fighting doctors (who think they can do anything & I’ll agree), fighting friends who’ve not been ill long-term and don’t know what the hell they’re doing. God, I am so glad to be home, where they can’t get to me, for a couple days anyway. So far, so good, but not released to go into office yet. Another tap dance to appease medical ego this coming week. Ah, To Be Free… (That’s actually the name of a bail bonds co. here in town: 2BFree.)

      Saw an interview from hosp. room w/Altman who said SPX will drop to 1740ish, then, many hop on for ride up, and indices will drop again. I think he said look for 1600ish. Just FYI. It will be interesting.

      Good thing 2013 was a profitable year. Have to pay yet another round of med bills. I get so tired of this…

      GL and trade well, Everyone!

  17. nyjsec314 says:

    Hey Tony. Can you comment on the Baltic index, in light of the tension in that region? I’ve been sikent but still reading often. Thanks in advance.

  18. Pingback: EUR/JPY Elliott Wave Analysis – Action Forex | I am John Becker

  19. wildmarkets says:

    Are there any counts for Mortgage rates 15/30 year to see where things are headed?

  20. Treasuries are pushing multi month highs. Not sure which bonds were lower this week and are downtrending. NAZ is blowing off on the back of a parabolic move in IBB.

  21. M1 says:

    Thanks, Tony
    I see a similar situation than the last two weeks.. NAZ is at a long term major resistance. (4259/4289) and we can not blame Rusia for the next wave down (if we believe in waves).
    I still expect NDX Cycle wave 4 (a 38..2% Fib Ret of Cycle wave 3 = + 27% decline)

    • M1 says:

      One last observation: When the old Dow crashed in the 30s, it took 23 years to recover and hit that major long term resistance at 297. So, It is quite surprising the NAZ took only 13 years to do the same.

      • tony caldaro says:

        hi ho hi ho It’s off to Print the FED goes.
        In the 30’s 40’s we were on a gold standard

      • M1 says:

        In those years WWII came with cycle wave 2 . IMO, NAZ cycle wave 2 was the 2007-2009 bear market. And We had no war but we did have a great financial crisis.
        In the 30s 40s cycle wave 3 was extended. IMO NAZ cycle wave 3 is unfolding from the 2009 lows. So if the FED is trying to manipulate the waves and repeat the 30s 40s pattern, this correction should be only major 2 of primary wave III of cycle wave 3.
        Very interesting because this would suggest we won’t have a bear market anytime soon but a long and extended cycle wave 3.
        Have a great weekend

  22. I found this talented option player on TC 2000 software program, in the Mr. Worden, News and Notes section. What caught mt attention, Open Interest at the strike price of 183 on SPY. Huge 69,600 vs calls low open interest of 1,800

    Spy closed at around 184.00 on Friday.

    Anyways, the education section, has some very good stories. Clearly, the person who running the website, knows about options. Going into next week, logic, would suggests, SPY with such large open interest at 183 strike price, markets ready to rebound.


    I also, noticed, author closed out his short positions recently.

  23. Lynn Hoggan says:

    Excellent Information… Thanks for all your hard work 🙂 Lynn

    Lynn D Hoggan Sent from my iPad


  24. Thanks for a wonderful update Tony. I don’t envy you tracking 30 indices, plus commodities, currencies, and a bunch of individual tickers.

    Question for you: has the SPX in it’s history made a b-wave high 2% above the previous high? As far as I recall not during this current bull market.

    From what Tony wrote I deduct the following, but correct me if I am wrong:
    1) if you are a bull, your best bet is to trade the NAZ/NDX for now
    2) if you are a bear, your best bet is to trade the DOW for now
    3) if you are neutral, your best bet is to trade the SPX for now
    4) Close above SPX 1884 and intermediate iii of major 5 confirmed
    5) Close below 1828 and the recent ATH was most likely a larger b-wave (like on the DOW)

    That said, on to my favorite indicator: the SSTOs indicator. The daily already, after re-examining the charts, gave a sell-signal on Friday 3/7, which was confirmed on Wednesday and it has remained on the short side since (which I choose to ignore… ouch… 😉 ). Now it appears as if further downside starts to become limited since the 5,1 is starting to hook. 13 and 21 show no signs of a buy-yet. This pattern also developed early December last year (see green box on chart in provided link: http://soulsurferusa.wordpress.com/2014/03/15/daily-and-weekly-sstos-short-term-up-longer-term-down-or/ )
    The weekly now also gave a sell-signal. If next week closes above 1884 then the current signal is likely negated. But, anything lower than 1841 or 1860/70 will most likely confirm this weeks signal. The market is at a cross roads indeed.

    GL y’all !!!

  25. Believe if 1841 breaks then 1803 and 1738 are on tap. Never like to call anything a slam dunk, but 1738 lines up fibonacci wise etc, a double bottom major 4 low there initially… then we will see

    Best to all

    • 777daimon says:

      wave-wise, according to your view, where are we now?
      Completing the what wave inside wave A ? Or to rephrase, a target for wave A is 1803?
      Thank you.

  26. bouraq says:

    Weekend charts:

    • 16golfer says:

      Thanks for sharing with us as always, bouraq. Very helpful .

    • blackjak100 says:

      Thanks bouraq! I closed my crude short luckily near the low before it rebounded $1+. I did reenter the trade Fri PM so I’m hoping the orange band holds and reverses down for an extended fifth way which is typical for commodities. The third wave was slightly longer than the first which raises the probability the fifth will be extended (since 1 and 3 are almost equal) assuming my count is correct.

      Gold has been frustrating, but I still think there is a reversal coming early next week from an EW perspective! The rise from $1182 lasted 52 days. On Tuesday, it would equal a fib 54 days. It’s possible we topped on Friday at $1388, but I’m leaning towards a top near $1400-$1410 now. Why? I think wave 5 of c of Y of WXY from $1182 is extending with micro waves 1 & 2 complete. Micro wave 2 is clearly a three on the hourly chart and it looks like micro wave 3 is underway. I expect this 11 week uptrend to top Monday/Tuesday to keep the proportionality of the waves intact.

      • bouraq says:

        You were right on gold. Tuesday for a reversal sounds good to me to break down the blue channel.

    • ggok1 says:

      I love your channels. Thanks for sharing everyday.

  27. manunidhi21 says:

    Namaste Tony !
    How much weightage does NAZ carry when its a new index and also sector specific in counting P3 ?

    Nevertheless all the substantial growth is going in that sector(NAZ) from a decade.
    dotcom may be a bubble, this time all big companies are of this sector.

  28. Awesome analysis! Tony, hit the nail on the head, again, (Next week, Test! ) 100% agree.

    I’m only concern with the short term, hourly, due to I went long McDonald’s at $97.043 yesterday.

    Mr. Ron Walker, follows closely, the equity, put/call ratios. Given, next week is option expiration week, its wise indicator to track.

    The market reached extreme fear point around Feb 3, 2014 DJ 30 sold off to around 15,400 if you observe, CBOE reached and closed above its 21 day Bollinger bands! Then, fell back into the upper band. Triggering serious high potential buy signal! DJ 30 ran from lows of 15,400 to above 16,400 basically, 21 day trading surge! Currently, $CBOE closed at high reading of .69 on Friday, just few points off of the .71 high.

    Now, going into Mondays trading week, option expiration week: observing four major stocks, BA, Gm, GE and IBM respectly. BA inside day, 34 trading day low of $121.63 and Fridays close of $123.11

    On short term perspective, hourly, most of the major stocks, indexes, 21 trading hour, will be the first hour of trading come Monday!

    Tonys Analysis + Option expiration week + huge amount of fear still in the markets with high $CPOE .69 reading = Potential for 16.300 to maybe 16,400 next week.

    Just my observations!
    The CBOE Equity Put/Call Ratio – A Contrarian Indicator:

    Here the 21-day Bollinger Bands are used with two standard deviations above the 21-day MA, and two standard deviations below the moving average to better quantify the high and low points, allowing us to pinpoint new buy and sell signals from fear and greed extremes in the CBOE equity put/call activity. When the put/call ratio climbs above the 21-day upper Bollinger Band and then falls back below it, a peak in fear occurs and a buy signal is triggered.

    A close below the lower Bollinger Band, followed by a return back above it suggests too much call buying. This produces a sell signal.

    If there is a close above or below the bands, it signals an unusual event that should result in an important turn in the market once the indicator closes back into the band, marking a peak in fear or greed. Look for peaks of fear to form above 80 percent (.80 means 8 puts trading for every 10 calls) signaling market bottoms, while a move below 40 percent (.40 means 4 puts trading for every 10 calls) hints of greed and a market top. Again, it is when these extremes occur outiside of the Bollinger Bands that new signals are generated.

  29. Pingback: Risk-Reward Market Report – 2014.11 | The Risk-Reward Report

  30. Happy weekend to you, Tony. I won’t pretend to guess the long-term — you have that covered. The short-term indicators I use say, “Keep holding your shorts, kiddo (bought SDS on 3/12 @ 28.76 — holding other individual stock shorts purchased on 3/3 and swing longs were sold a couple of days ago).” No predictions here, just going with the present flow. As you say, project, monitor, and adjust (hope I didn’t just blow that).

    Love your weekend analysis! 🙂

    -OEW Coffee Club Member

  31. 16golfer says:

    Maybe Mr. Market is testing Yellen?

  32. attitude928 says:

    Thanks Tony. Would the RUT wave count be closer to the SPX or NAZ?

  33. rolandu11 says:

    The candles were right. There were declines and the Crimean crisis played a role. I think, however, that the candle sticks are easy to understand, but most consider the formations only isolated (Then they sometimes get an incorrect result).
    Overall, we now have a marginal situation. The indices are in a support area now. And some short-term indicators are already heavily oversold. Normally, a rebound is due. But a breakthrough could be bad.


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