monday update

SHORT TERM: gap down opening then lower, DOW -167

Overnight the Asian markets lost 0.8%. European markets opened lower and lost 1.4%. US index futures were lower overnight, and the market gapped down at the open to SPX 1860. The market had closed at SPX 1865 on Friday. The decline continued in the opening minutes to SPX 1854. Then the market rallied to SPX 1864 just past 10am. After that the market headed lower again. At 2:30 the SPX hit the 1841 pivot exactly, then tried to rally. At 3pm Consumer credit was reported higher: $16.5bn v $13.7bn. At 3:30 the SPX hit 1853, then pulled back again to close at 1845.

For the day the SPX/DOW were -1.05%, and the NDX/NAZ were -1.00%. Bonds gained 6 ticks, Crude slipped 50 cents, Gold dropped $7, and the USD was lower. Medium term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Tomorrow: Congressional testimony from FED governor Alvarez at 10am, then a FED board meeting after the close.

The market opened lower, and continued to decline throughout the day. Around 2:30 the SPX had fully retraced the recent 1843-1897 rally when it hit the 1841 pivot. After that it started to rally from an extremely oversold condition. For the SPX uptrend to remain intact it has to hold the OEW 1841 pivot range. The short term count on the SPX is a bit vague at this point. It has been quite choppy. Nevertheless we updated the chart to the most feasible count at this time. The NDX/NAZ still have positive divergences, so it is possible we may have just seen the worse of their correction today.  The DOW alternate count was updated as well. Unless we get a downtrend confirmation in the SPX the four major indices should align.

Short term support is at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Short term momentum hit its most extreme oversold level in quite a long time, then just oversold. The short term OEW charts remain negative with the reversal level at SPX 1869. Best to your trading!

MEDIUM TERM: uptrend weakening

LONG TERM: bull market


About tony caldaro

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145 Responses to monday update

  1. torehund says:

    Coal, oil, Gold and Shanghai on the run, bulk hasn’t started yet besides Genco Shipping and trading that also out of tradition is the first to run…But it doesn’t feel comfortable to be long here, thats for sure.

  2. Hey guys,
    Mighty weak bounce in my opinion. “Turnaround Tuesday” ???

  3. Bad News Tonight????? ,, Gap Down to 1830 by morning????. 5 years of gap ups, nobody should get upset if we gap down.

    • Dude there is no fear. VIX is to low

      • rc1269 says:

        seriously? pls, for all our sakes, enough with the vix. it is not predictive in the way you make it out to be. how many times do we need to beat this dead horse?

      • Not predictive? are you sure. If you followed the VIX and used it you would not sold stock for 3 years which made people a fortune. we are 2.5% off the highs ? OEW has shaken people out a few times. but the VIX has not gone and stayed above 20 in how long? VIX does not measure volatility like it should. You had a 34 point move on S&P friday with the VIX at 14.

      • hrmny358 says:

        It is better to watch TRIN

      • rc1269 says:

        “You had a 34 point move on S&P friday with the VIX at 14”
        i couldn’t have said it better myself. yes, i’m sure – it’s not predictive. i’d suggest going back and reading my several lengthy commentaries on it.

        • tony caldaro says:

          The VIX measures volatility
          A 15 reading is 1% daily vol
          A 30 reading is 2% daily vol
          If vol is considered fear, then there is your numbers
          We have not had a 30 reading since Primary II

  4. BTD time. What else is there to say?

  5. uncle10 says:

    If I were bullish, it would not make me feel good to see the JPY having a big and could be an important move up today. I don’t like to be positioned against many of the great follows here, but there are too many things saying down for me. Still holding support so not a bad spot to try long but I would have a tight strict stop loss if long and would want to be in futures/something I could avoid gap risk on. Interesting as always….. gl

  6. lunker1 says:

    check out the MA’s on Tony’s INDU 60min & daily charts….resistance.

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