thursday update

SHORT TERM: market rebounds, DOW +109

Overnight the Asian markets lost 1.3%. European markets opened lower but finished flat. US index futures were lower overnight. At 8:30 weekly Jobless claims were reported higher (320k v 315k), and at 9:30 the market opened two points below yesterday’s SPX 1861 close. After a nudge up to SPX 1860, the market pulled back to 1855 just before 10am. At 10am the Philly FED was reported higher (+9.0 v -6.3), Leading indicators were reported higher (0.5% v 0.3%), and Existing home sales were reported lower (4.60m v 4.62m). The market then rallied to SPX 1868 by 10:30, pulled back to 1863 by 11:30, then moved even higher. At 2pm the SPX hit 1873. A pullback to SPX 1868 followed by 3:30, then a bounce to 1872 ended the day.

For the day the SPX/DOW were +0.60%, and the NDX/NAZ were +0.30%. Bonds lost 3 ticks, Crude slipped 45 cents, Gold dipped $2, and the USD was higher. Medium term support rises back to the 1869 and 1841 pivots, with resistance at the 1901 and 1962 pivots. Tomorrow is Options expiration, and FED governor Stein gives a speech in the evening.

The market opened lower today, pulled back to SPX 1855, then nearly made it back to where it was just before the FOMC statement at 2pm yesterday: SPX 1874. While the post-FOMC pullback yesterday was blamed on the mention of raising rates in 2015. Long term rates have more than doubled since mid-2012: 10YR 1.39% to 3.36% recently. Also, historically the FED does not lead in raising/lowering rates – they follow the one year rate. Currently it is at 0.17%, and it has been in a 0.08% to 0.22% trading range for three years. There will be no signs of any short term rate increases until the one year gets well over 0.50%. We are still holding to the above SPX 1884 Minor 3 underway, below SPX 1840 uptrend may have ended at SPX 1884 scenario.

Short term support is at the 1869 and 1841 pivots, with resistance at SPX 1884 and the 1901 pivot. Short term momentum rose from quite oversold yesterday to nearly overbought today. The short term OEW charts turned positive again with the reversal level now SPX 1866. Best to your trading on Opex day.

MEDIUM TERM: uptrend

LONG TERM: bull market


About tony caldaro

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96 Responses to thursday update

  1. torehund says:

    Well, when waves say so and we are tilted toward the inflationary, China is soon in focus. My prediction has been that the former country will do the Japanese magic; namely to devalue their currency. Bullish for stocks and gold, if it pans out I don’t know for sure, but charts say it MAY be the spring boost we need
    . Other than that my crystal ball has no more to convey at this time…..happy weekend to all on board.

  2. gary61b says:

    I can see the ES tagging the 1850.75,

  3. CygnetNoir says:

    Harvard, Dayton, and Mercer – is there anyone in the Billion$ Bracket who actually picked all three of those?

    I suspect that Buffet made a most excellent bet🙂

  4. lunker1 says:

    I think we topped and are going down. The bots are talking to each other with the .887 fib algo.. SPX intraday reversed at 887. INDU reversed at the .887 from ATH Dec 31 and the.887 from the recent March high. IWM and MDY reversed at the .887 from ATH. The NAZ reversed at the.786 from ATH. The Q’s twice reversed at the.887 from March 13 high. Too many of them showing up to be a coincidence.

  5. CygnetNoir says:

    We were talking about CANN a couple of weeks back. Having hit an intraday all time high of $64.64, it immediately reversed. It is now trading at $31.20 bid 31.75 offered. It has support at $30, but when that breaks (and I’m pretty sure its a matter of when, not if) in the next few days, it should fall quickly back to the realm of penny stocks from whence it came. I’m not suggesting anyone trade it or short it, but put it on your watch list and see what becomes of it.

  6. nenehubb says:

    Want to be sure if that Is a -div in SPX 60 min? Sorry for this newbie question. Thanks!

  7. JK1987 says:

    1869 -, Right here, cover all scaled shorts.
    1883, 1882, 1881, 1872, 1867.

    • JK1987 says:

      LOL, best week.

      JK1987 says:
      March 21, 2014 at 8:55 am
      Negative divergence.
      Selling into the strength, 1883, 1882, 1881.

      JK1987 says:
      March 20, 2014 at 12:10 pm
      1873, sweet spot, scale in more shorts.

      JK1987 says:
      March 20, 2014 at 9:36 am
      Short right here 1867+

      • uncle10 says:

        Nice work JK! Taking heat is no fun. I was feeling it in my britches big time! I stayed in most all my shorts though. I guess if Putin says anything the market will gap up like usual…. I am hoping he keeps his mouth shut!!😉

    • Kisshu2 says:

      excellent trading jk

  8. jv200909 says:

    Hi Tony, scty wave i has been breached today. Close to a bounce but the macd looks very negative.;

  9. uncle10 says:

    Red day today on SPX will not be good ( if bullish). Good weekend all.

  10. Observations: $trin rising 1.33 $Trinq 1.22 rising!

    Entering 33 trading hour on SPX went short DD DuPont at the open, sold the trade for nice profit, looking to enter short again next hour.

    Baby sitting my nephew today, love four year olds, they don’t know the difference between, quarters and pennies, already, traded five pennies for his five quarters.


  11. I do not post counts as I think they have not worked unless you are bullsih. Some of the indicators I follow will lead me to say YOU have seen the HIGHS for the YEAR. and we start the correction today going into next week. Good luck everybody

  12. Well, I had to put my money where my mouth was and that meant going long with a break above 1874. New intra-day ATH puts, IMHO, any larger correction also on hold. In addition, the daily SSTOs indicator gave a buy signal on tuesday 3/18 and has remained, correctly I must say, long since. And the weekly sell-signal from 2 weeks ago is (about to be) negated. Likely minor 2 is done, IMHO.

    • simpleiam says:

      surf, that would really be nice if this m2 is done; I’m soooo sick of it!
      Any indications of how high you think this w3 will go?
      Thanks much.

      • that would be nice indeed if m2 is done, but as soon as I open my mouth the market takes a dump… I’ll better shut up and leave this mess to Tony,😉 I am very sick of it too. what a whipsaw frikin city. it has gone nowhere over the past 3 weeks… Now I might as well post a sell signal on the daily SSTOs… sjeeez. Tank or take off please.

  13. blackjak100 says:

    If this is a B wave from 1739, it counts nicely as a double zig zag now. 1862-1839-1884-1840-1874-1850-1884 so far. I can’t see this as a third wave as momentum has been lacking and lots of overlapping.

  14. lunker1 says:

    INDU’s been leading lately. Q’s lagging. INDU 2 month cup and now at the top range of the March bull flag handle. max handle approx 16500. Q’s have a diamond that started Feb 20 and just made a higher low for the right side of the diamond (a buy?). basically been a long sideways correction to chew up time after the strong impulse off the Feb 4 low. SPX made a small cup since last 1884 high and maybe now consolidate in an ABC handle and the B is about complete at 1881+. watching INDU handle breakout or Q’s diamond breakdown for clues.

    • lunker1 says:

      bad math on the handle. make that 16480.

    • lunker1 says:

      also Q’s have room for a lower low on the diamond. anything above 88.63 or even a slightly lower double bottom to run stops. Q’s love to be volatile.

  15. RDC says:

    If you are reading this blog, can you give us update on “DOW Sell Theory”. So far it looks like “DOW Bull Theory”. Thanks🙂

  16. gtoptions says:

    Thanks Tony
    Look at that $DJI, Wow! Breakout coming?😉
    GL & Good weekend all.

  17. mjtplayer says:

    Pop goes the biotech bubble – BIS should be a great trading vehicle in the months ahead.

  18. idal75 says:

    spx new high ahead…(today)

  19. HEADS UP, only. I pay special attention to individual stocks for market direction (always have a list I am watching) and two that I am am shorting just all of a sudden nose-dived (good!). They are: IBB, NFLX. Others on my watch list are also dropping fast. Just sayin’ — eyes wide open. DISCLAIMER: I am not short any index at the moment — no short-term signal for that yet.

  20. lunker1 says:

    Bots got 10 and JK is repeating himself again. He must be emotional.

  21. manunidhi21 says:

    Hi All,
    Can anyone guide me about Global futures ninjatrader credibility ?
    Please let me know as I am in Canada and do not understand how it works in US for trading mini dow or spx. I really need guidance as I am a new bee for US trading.

    You can mail me at to save Tony’s space .

    Namaste Tony !

  22. taobh na fothana says:

    Interesting action in the NQ , fumes from the expiration or something else ? Thx

  23. blackjak100 says:

    I’ve never seen an ATH made on the S&P, albeit by cents, with so much red on my screen! No momentum at all!

  24. JK1987 says:

    Negative divergence.
    Selling into the strength, 1883, 1882, 1881.

    • llerias7 says:

      Cool down…this is going way far above 1900´s next month!
      Meanwhile 1900´s is a given acording an IHS

      • tommyboys says:

        There’s a much large IHS on Tony’s 60 min & daily beginning in January with the neckline near 1850 targeting conservatively 1950/1970 FWIW. B/O has occurred on this one.

      • JK1987 says:

        Negative divergence is the fact.
        Already sold the incremental of 1883, 1882, 1881.
        Will sell more every point higher above 1883.
        According to the record, you have been saying 1900’s for 5 months.

      • tommyboys says:

        If you’re referencing me I haven’t been calling for anything. I don’t see much divergence on the SP daily or 15 minute here either FWIW. Time will tell.

      • rc1269 says:

        ahh it’s the ol’ IHS at the highs. always liked that one. i always thought that IHS was more robust as a bottoming pattern not an extension of a high pattern, but could be wrong. i guess let’s just hope it’s not like the “IHS” we got in Feb ’11- April ’11.

      • tommyboys says:

        True RC – IHS typically work best at bottoms just as HS work best at tops although neither are infallible. Taking a high fly over you could certainly consider the 2009 low and ensuing highs here as a beautiful IHS – the head being right at the ’09 low. If so it targets 2470+ on the SP!! Fingers crossed🙂

    • buddyglove says:

      I’m with JK….money in the bank 🙂

  25. simpleiam says:

    Made a small but sweet profit on XIV this morning. I don’t hold trading positions over weekend, so bid you all the best and GL trading! I’m off to physical therapy… OMG, “the pain”… That’s my Dr. Smith imitation, it’s the best I can do right now. Bye!

  26. 11 A.M. Pacific time, will be monitoring, Breath numbers, $Trin, $Trinq, high noon, will be 34 trading hour, and 13 trading hour from 3-19-14 1850.35 low.

    Might go short around noon today. If the pattern lines up with timing cycles.


  27. The NYSE A-D line has weakened since J. Yellen’s comments that interest rates might rise by 2015. I attribute that to the abundance of preferred shares on the NYSE which trade a lot like bonds, although it has also occurred on the NASDAQ where preferreds are not very prevalent. Small company stocks and growth stocks depend a lot on borrowed money, making their profitability vulnerable to higher rates.

  28. mkt. update for thurs. and plan for friday (within remark’s sect.):

  29. torehund says:

    ..lots of them around nowadays…
    Thanks as always for the update Tony, surfing is picking up here in south of Mex and I can work without being supercritical, hey its spring ! A Little Red label on the rocks at the terace looking towards the pacific isnt bad !! Cheers.

  30. Hi Tony

    On the hourly SPX chart:
    – yesterday’s low to yesterday’s high at close was an micro a-b-c to a minute-a.
    – then down at today’s open to minute-b.
    – up from there in a five wave structure to minute-c (showing well on the 2- or 3-minute chart).
    Therefore, to me, this was a typical retrace during an impulsive trend down.

    This is invalidated if we close above 1875 (then the dip to 1850 was a minute-2) and I will ride the market to a higher high.

    Trigger to go short is 1850 for an impulsive wave-3 of c down.

  31. bouraq says:

    Choppy cont’d:

  32. bhupal777 says:

    Tony, Thanks for your hard work and free service to trader’s community.
    I had a great day with my US regional banks (KRE) positions. Still waiting for the breakout above 1884 on SPX to go long.

    Charts on regional banks, particularly ZION, CMA and RF did very well today.

    Most of my short ideas stayed in Red on a green day.

  33. RDC says:

    Thanks Tony. It is good to know when Fed increases the short term rates.

  34. hucky2 says:

    Uncle – you failed to mention to Jeff that buying out of the money options has the highest risk!!
    Go stand in the corner with the naughty hat on for 10 min

    • jeffbalin says:

      It’s ok Hucky. Out of the money sounds exciting! But I suppose losng money would take the fun out of it.
      But it’s straddles I think. Maybe strangles, not sure which or both. The options strategy to profit on a nice big move regardless of which direction, as long as it moves good one way or the other. That, is what I think I would do right now, if I knew how to apply it.
      Leaning towards indices down, but still a shaky call.

    • uncle10 says:

      lol. You funny Hucky! Yes, Jeff, buying out of the money options is very high risk.

    • uncle10 says:

      I will be buying the VXX 44, 44.5 and 45 calls today near the open that expire today. They should be pretty “cheap” if this gap holds to the open. I understand and accept the risk they could be worthless at the close. gl to all.

  35. magnus1234 says:

    Tony thnx. Spot on with the 1yr interest rates. I still see all decent dips as buying opportunities. Whats the allternative?

  36. Thanks for your work Caldaro a tough job keeping a count. the only count i keep is I count on the market to continue to go up no matter what

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