monday update

SHORT TERM: gap up and go, DOW +182

Overnight the Asian markets lost 0.3%. Europe opened higher and gained 1.1%. US index futures gapped down 6 points at the open last night, but gradually moved up from that low. At 8:30 the NY FED was reported higher: 5.6 v 4.5, then at 9:15 Industrial production was reported higher: +0.6% v -0.3%. The market gapped up at the open to SPX 1852 and continued to rally. The market had closed at SPX 1841 on Friday. By 10am the SPX hit 1862, when the NAHB housing index was reported higher: 47 v 46. Then the market pulled back to SPX 1853 by 11:30. After that the market tried to rally again. By 2:30 the SPX hit 1861, pulled back to 1856 by 3:30, then closed at 1859.

For the day the SPX/DOW were +1.05%, and the NDX/NAZ were +0.90%. Bonds lost 11 ticks, Crude slid $1.05, Gold dropped $14, and even the USD declined. Medium term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Tomorrow: Housing starts, Building permits, and the CPI at 8:30.

While gapping down overnight after the Crimea pro-Russian vote, futures rallied right into today’s open and the market gapped up. On Friday we had noted a short term positive divergence and a daily oversold condition in all four major indices. The market responded to those technicals with a 20 point surge in just one hour of trading. Thus far, this rally looks like the beginning of Minor wave 3. However, we would like to see a new high in the SPX or NDX/NAZ before placing a Minor 2 label at Friday’s low.

Short term support remains at the 1841 and 1828 pivots, with resistance at the 1869 pivot and SPX 1884. Short term momentum is at overbought. The short term OEW charts swung positive early this morning, with the reversal level SPX 1858. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: bull market


About tony caldaro

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113 Responses to monday update

  1. JK1987 says:

    Is DOW still progressing with Primary IV?
    rc’s MIL still is good in that count.

  2. JK1987 says:

    By removing the question mark on c, meaning 3 of 3 of 3 should easily make new record high?;

    Good breadth
    New record high means new record high, not going to argue with that.;

    • tony caldaro says:

      This whole Crimea play is getting lots of talk, but little market action.
      Since this thing started the SPX has traded in just a 3% range: 1834-1884.
      Market looks fine

      • JK1987 says:

        Should I reverse short to long if it’s 3 of 3 of 3?
        Difficult decision, still hold scaled shorts from 1861, 1867, 1872.
        Wish to hear from jedi as she also scaled in shorts, I value her comments very highly.
        Also a female, what will Yellen brings tomorrow?

        Record high on the good breadth should do it?

      • I believe News follows the Charts NOT charts follow the news. The Big Money has an agenda, its simple, screw as many along the way BUT bring the market to their final destination whether that target is a daily, weekly, or monthly, yearly timeframe.

      • Hi, JK, I am sorry, as I just saw your question. I work during the day and I rarely get time to check the blog between 9 am-6:00 pm. I am not holding my SDS. I had hedged with TNA on Monday … and I kept the TNA and sold SDS. Did you see my early a.m. tip yesterday I think about this hedge? Was trying to tell folks how not to lose on a trade — flip the switch fast. Since I had bought SDS at 28.76, there is no way I was going to hold it below my entry. I still own three stocks on the short side. BIG TIP: Get rid of a losing trade quick. That is my biggest tip. If they are not going the way I expect them to, I sell. Period. Didn’t buy to lose money. My discipline is what keeps me in the green … and always having a plan.

        Now, let me say that this market is very volatile of late. The above scenario also happened to me last week — started a short, had to hedge with TNA, kept the TNA … and then sold TNA just two days later (I think) before I got a sell signal so and flipped to SDS again (the trade I just dumped). I would not be surprised if this happens to me again this week with TNA. So, my profits this past two weeks have been small, but better green than red.

        Good luck, my friend. Thank you for your compliment. I truly am honored.

        THANKS, TONY, for allowing us all to share. We all respect your analysis and daily/weekend commentary. Love reading them!

  3. waddaguess says:

    TC, does this look impulsive to you so far from 1839? Seems choppy.

  4. 34 points for this wave

  5. Elliott Wave Oscillator trending higher, Five minute time frame, just crossed above zero line, Five minute time frame, McDonald’s stock. Could it be ready to move higher?

  6. 777daimon says:

    ok, since I see everyone is so complacent here and relaxed now that the russian problem is closed and Putin has promised he won’t touch another country (and we believe him, of course, he a good man) I have a piece of advice for you all that want to make money in this great booming bull market with a amazing leverage level already reached….–3-reasons-to-tap-home-equity-to-buy-stocks
    GO for the money! 🙂

  7. Market Locked at 1870, market makers got their hands tied.. Market goes up people will sell, market goes down go down people will sell and short. Quick Flush needed asap.

  8. uncle10 says:

    Been a long time since both the weekly and daily charts for SPX are setting up as good short pattern at the same time. You never know for sure but for what I use it doesn’t get much better than this— I have a starter position short and will add more sometime this week unless it just keeps going striaght up. Gl.

    • CygnetNoir says:

      GL,l uncle. I have to say that I don’t see it, but I’m half-blind and half-asleep and I’ve been told more than once that I’m playing with only half a wit, so what do I know? The only thing I see is that it looks like all the juice has gone home for the day and all the playas are hangin with Lee and waitin’ for Janet to get done yell’n.

  9. JK1987 says:

    the bears are wearing white.

    Lee at ceres cafe Chicago
    male, age 50.

  10. jim bez says:

    trading both ways the posted reversal levels have been money in the bank this past week

    ding ding Kudos

  11. Lee says:
    I yam who I yam
    Anybody wants to buy me a beer or take a shot at the title I’ll be in the lobby of the CBOT @ noon at Ceres cafe today.
    I’ve become a distraction here and it’s my fault as I stayed too long , I should of listened to Neil Young…

  12. mjtplayer says:

    S&P putting in a right shoulder of a H&S pattern? Neckline at 1,840 – downside target is 1,780 – 1,800 which would be int a for the S&P but the corresponding DOW move would be int c to complete major A.

  13. Lee says:

    Nice job Tony
    pivot to pivot so far 1841-1869
    Could a pivot pool tourney be possible ? B wave here

    • buddyglove says:

      What the deuce is a “pivot pool tourney” ?

      • Lee says:

        when the mkt trades up to a pivot and back down to the next and visa versa
        I know futures dont count in the count but man does it look like 3 waves up on the YM , ES and NQ

      • CygnetNoir says:

        I agree with three waves up there is some interesting OB/OS stuff going on with the DJ-30 on the daily chart. Strike a trendline across the HOD’s 2/19, 2/24, 2/28, 3/7 and then clone that line and anchor the end of it to the 3/3 LOD. Use that the old fashioned way and the trip below was way OS and now with the trip back to the lower line price is back to neutral. Hence the pause … and here ios the rub – 5 minute chart shows a nice little triangle that some are so fond of pointing out, and it just now did its 3rd test of the opening range’s 16320’s, and so right here we should see whether that was an “e” of an a-b-c-d-e 4th wave of some such degree (if so, we should see the rally continue). If instead price starts dropping, especially if DJ-30 goes green to red, then we are likely seeing the first nesting 1-2’s of a retrace to test last week’s lows. Dow 16320’s – 350’s is a no man’s land where the bears and the bulls are playing “capture the flag.”

      • CygnetNoir says:

        I was thinking the very same thing as I typed that … lol …

    • gtoptions says:

      Thx Lee
      Feels corrective here. That’s too bad. 😦
      We’ll see.

  14. llerias7 says:

    Well…finally iii of Int.III on the way…geting above 1900´s.

  15. magnus1234 says:

    Getting closer to my “SPX-alert” level which is 1874. Watch out for Bonds and 10yr Notes…they are just floating sideways.

    • pimacanyon says:

      what will you do when SPX hits 1874?

      • magnus1234 says:

        we must break it like a hot-knife in butter….that is conviction in momentum+volume+price action…if it hesitates i off-load 50%. That protect my 25 SPX handles all the way down to entry.

  16. RDC says:

    New high in SPX is expected this week. Gold is very close for rebound around 1340-1350.

  17. The unsuspected C WAVE is coming from here to 1815 to 1795…..

  18. If bears to come out now, then don’t bother.

  19. magnus1234 says:

    added more to my longs this morning. Breadth (advance-decliners) possitive. Upvol-downvol showing program buying before future rolls friday. Interesting is that DOW leads this morning.

  20. JK1987 says:

    Sold here at 1862+ with double top, 9 handles profits.

    JK1987 says:
    March 17, 2014 at 10:42 am
    Covered shorts here 1853 with 7 points gain, switch to long.
    Down from 1862 is corrective 3 waves.

  21. 3xETF, you went missing again?

  22. rc1269 says:

    futures ramp 10 points on Putin’s side comment that Russia is not seeking to split up Ukraine. despite having just… split up Ukraine.
    can’t make this stuff up

    • LOL!!!! Love a laugh in the morning — thanks, RC1269. We all know the market is 500% manipulated — that’s why play technicals, as everything else is just noise. Have a great day, Tony, and all.

    • Taking Crimea does not count as splitting up Ukraine. Taking the Eastern (more pro-Russian) half of Ukraine would fulfill that definition. But even in Eastern Ukraine, there would be great resistance to a Russian takeover. Russia does not want the burden of having to occupy a country as large as Ukraine, but neither does it want Ukraine to pull too far away from Russia.

  23. 777daimon says:

    Hours ago Transdniester (a self-proclaimed republic , part of Republic Moldavia) requested to be annexed by Russia.
    It is to be mentioned that there Russia keeps it’s 14th Army on Rep. Moldovia territory and REPUBLIC OF MOLDOVA (INCLUDING SELF-PROCLAIMED REPUBLIC OF TRANSDNIESTER) is in the western part of Ukraine.
    My opinion is that this Russia-Ukraine problem is far from over and Russia wants to annex ALL UKRAINE!
    I personally request to someone who has the courage and opportunity to phisically eliminate Putin!
    We are headed to WW III and this fact will be stopped if Putin is eliminated now!
    EU and NATO and USA and UN didn’t reacted strong enough and the russian monster is extending! Military extending!
    Putin must be stopped, for good! NOW, while there is time!
    He will trigger WW III !

    • Wanted to not write anything for a week. Anyway,

      There no threat of WWIII for the reason the USA will lose everything incl. reserve currency status. It needs a mention that USA is in debt.

      When there is disaster in Japan, yen strengthens for the reason, Japan is in credit and starts pulling monies out. But, reverse is true for the USA.

      If WWIII starts, Russia attacks…US attacks, assuming equal loss, America will run asking for monies trying to sell treasuries, which no one will buy. Whereas, Russia will start selling gas/oil at exorbitant prices and make monies. Neither Google/facebook/twitter are necessities of life, nor apple iphone. I do have one iphone but I also have SAMSUNG. I dont use Google any more for searches, my insurance/travel/flight/hotel comparison websites are on desktop shortcut. Rest of the items that I buy are made in China.

      White house knows this that is why Putin name is not in the list. once, Putin loses his power, by giving some excuse, white house will put his name as well in the list.

      But, the point is, Old man (I am talking of Warren Buffett) is saying “best is yet to come for the USA and next 50 years are going to be great for the USA…” what will happen to his theories? What will happen to shell/fracking gas theories? What will happen to american oil independence theories? What will happen to SPX 3200 theories?

      ..and I believe in old man and all these theories and that is why WWIII will NOT start. OLD MAN/THESE theories CANT BE WRONG.

      Just FYI: I am not YenGuy/Robert whatever..I am myself..I cant give someone else credit for being me!!

      This is definitely last post till 25th March..I am not replying to anything..

    • RDC says:

      You said: “I personally request to someone who has the courage and opportunity to phisically eliminate Putin!”

      Are you asking a member on this blog to do this?

      Anyway, calm down, relax and concentrate on waves. Buy Gold and live happily ever after 🙂

    • alexhartley1 says:

      777daimon if you have the time I would recommend you read a couple of books by George Friedman – The Next Decade and The Next 100 Years.

      He wrote these books a few years back and 2 of his main suggestions have already started to occur – a thawing of relations with Iran (with the opposite happening with Israel and Saudi Arabia) and at some point a new Cold War with Russia. However the result will be the same as the Russians simply can’t compete with the US. They know this.

      This for the record is the United States’s Century. Not China’s and no one else either.

      If you’re looking for a potential war then you’ll probably see one later on this century between Japan and the US believe it or not. China will face it’s own internal problems and won’t be more than a regional threat.

    • pimacanyon says:

      this is a joke post, right? or troll? (I’d suggest peppering your comments with a few more exclamation points for emphasis. Just to make sure we all get how urgent your post is.)

  24. 777daimon says:

    1823-1827 in SPX coming to a cinema next to us 🙂 today!

    • You are greatly exaggerating. Russia does not want to reacquire the Ukraine. It just doesn’t want it to fall into the Western sphere of influence and become a security vulnerability. Remember in the Crimean War of 1853-56 the goal of the Western Powers was to drive Russia out of the Crimea and the Black Sea and deprive it of warm-water access. Does anyone remember this poem about the charge of the British Light Brigade up the Balaklava Valley of the Crimean Peninsula? This was a crucial chapter of the Great Game, the 19th Century rivalry of European empires.

      The Charge Of The Light Brigade
      by Alfred, Lord Tennyson
      Memorializing Events in the Battle of Balaclava, October 25, 1854
      Written 1854

      Half a league half a league,
      Half a league onward,
      All in the valley of Death
      Rode the six hundred:
      ‘Forward, the Light Brigade!
      Charge for the guns’ he said:
      Into the valley of Death
      Rode the six hundred.

      ‘Forward, the Light Brigade!’
      Was there a man dismay’d ?
      Not tho’ the soldier knew
      Some one had blunder’d:
      Theirs not to make reply,
      Theirs not to reason why,
      Theirs but to do & die,
      Into the valley of Death
      Rode the six hundred.

      Cannon to right of them,
      Cannon to left of them,
      Cannon in front of them
      Volley’d & thunder’d;
      Storm’d at with shot and shell,
      Boldly they rode and well,
      Into the jaws of Death,
      Into the mouth of Hell
      Rode the six hundred.

      Flash’d all their sabres bare,
      Flash’d as they turn’d in air
      Sabring the gunners there,
      Charging an army while
      All the world wonder’d:
      Plunged in the battery-smoke
      Right thro’ the line they broke;
      Cossack & Russian
      Reel’d from the sabre-stroke,
      Shatter’d & sunder’d.
      Then they rode back, but not
      Not the six hundred.

      Cannon to right of them,
      Cannon to left of them,
      Cannon behind them
      Volley’d and thunder’d;
      Storm’d at with shot and shell,
      While horse & hero fell,
      They that had fought so well
      Came thro’ the jaws of Death,
      Back from the mouth of Hell,
      All that was left of them,
      Left of six hundred.

      When can their glory fade?
      O the wild charge they made!
      All the world wonder’d.
      Honour the charge they made!
      Honour the Light Brigade,
      Noble six hundred!

  25. bhupal777 says:

    If this rally doesn’t hold and starts showing some cracks then here is my list of stocks for shorting. I did my home work and ready with ammunition. If it is iii of 3 then above 1884 I am long. GL to all.

  26. John Arella says:

    I use Google as an indicator or confirmation of the current Dow count, works for me 🙂

    • Thursday Price channel break by the bears, Did serious damage to the 21 trading day uptrend. Strong evidence to support my case.

      PMO indicator crossed its signal line, currently, Signal one at .81 and PMO at .83 well below the signal line. Comparing, Late July – August 2013. 21 trading day uptrend, PMO stayed above its signal line, thus, the uptrend continued to 29 trading day wave.

      Current 21 trading day wave from Feb 3, 2014
      1. Price action trend Channel, was broken, Thursday.

      I find it very low odds, once, PMO is under its signal line, it can reverse so soon.

      I rather, take note of the PMO as major clue that the price trend has changed. Oh course, this just my opinion.

  27. bobhopium says:

    Thanks Tony.

  28. RDC says:

    Thanks Tony.

  29. bouraq says:

    Correction or a new rally?
    #SPX #DJIA #RUT #GOLD #CRUDE #brent

  30. bhupal777 says:

    Thanks Tony. Until 1884 is taken out I am neutral. This could be very well some kind of smaller scale b-wave rally morphing. I didn’t see major growth stocks acting like we are in iii of 3.

    • Thanks, Tony!!

      BINGO, Bhupal777! You get it. Like you, I also watch individual stocks … and the one’s I track barely moved today. They started up and gave most of the gains back. The shorts I have been holding are still a hold (posted them on this blog last week). So, I also think this may be a b-wave rally. Either way, we’ll go with the flow — I’m hedged.

      • I think it could be a B wave guys but the lack of movement in the small caps today could be attributed to their having a green day already on Friday, and the larger caps catching up today. People are dipping their toes in the water. I see the small caps on the hourly shifting over to oversold this afternoon. If this is a real move to the upside they should take over leadership again tomorrow and outperform the larger caps as the larger caps pause for awhile. The hourly in IWM looks bullish to me with today’s candles riding the top of the trendline connecting the three peaks of the correction decline on the hourly. If resistance is now support then a test higher should come soon. A breakout over 119 and all time highs should follow. Would have to break that trendline asap to the down side if it’s going to do it.

        Only thing that worries me is it’s triple witching week. Bears got burnt today and I’m expecting a big red day sometime this week to burn the bulls too. That day may look like minute ii in hindsight. Have a good evening!

      • bhupal777 says:

        Unless sector rotation is taking place from growth stocks to big caps.

  31. Hi Tony

    Due to the gap up, we need to look at the futures, which show a 5 wave movement up to today’s high. A wave up is also confirmed on the hourly and shorter time frame charts. This short term wave up is happening on a down-trend midterm background (obvious on the hourly charts).

    Therefore, we need to see what tomorrow brings:
    – More up movement, we go long and ride the next short term leg up.
    – Down movement, and we short the market on the hourly market.

    • More up movement, I go short and ride the next short term leg down.
      Down movement, and I short the market on the hourly market.

      Tuesdays, first 30 minutes of trading.

      Black Swan event coming! Elliott called it ___________ event.

      Clue starts with E

      I have no position, might go short Tuesday. GL

      Great analysis again by Tony…

      • NYSE quickly open up to 10,388.47 in the first 30 minutes of trading, the second 30 minutes, NYSE made higher high, 10,399.44 but quickly pull back over the next hour and half to low of the trading session, 10,348.71 then, trading sideways the rest of the session. Ending the last 30 minute session, on fairly weak Note! At 10,376.55 lower close then opening for last 30 minutes.

        $CPOE closed at .56
        Short term trading index closed at .94 fairly neutral reading

        I’m not convinced, NYSE ready to start impulsive move higher as of yet. NYSE Time segmented volume, displaying negative divergence over ten day period, hasn’t even come close to crossing over its 19 dma, which leads me, to draw conclusion, this is just plain old short covering.

        3-6-2014 to 3-14-2014 may be A-B-C – X Wave in the making, followed by another A-B-C lower.

        Bearish sentiment in my opinion, needs to be higher than $CPOA .67 and .56

        Volume indicators currently, are just not supporting minor Wave iii kick off just yet.

    • tony caldaro says:

      STT thx
      Rally stopped at logical resistance, next few days make or break

  32. M1 says:

    Thanks, Tony
    It looks like the market approved the referemdum in Crimea. Let see if it approves the western reaction in the next days

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