monday update

SHORT TERM: market drifts higher, DOW +41

Overnight the Asian markets opened gained 0.3%. European markets were closed for an extended holiday. US index futures were higher overnight, but the market opened unchanged at SPX 1865. After a push up to SPX 1871 by 10am, the market started to pullback. At 10am Leading indicators were reported higher: +0.8% v +0.5%. At 10:30 the SPX hit 1863, and then began to drift higher. Around 3pm the SPX hit 1872, and closed there.

For the day the SPX/DOW were +0.30%, and the NDX/NAZ were +0.70%. Bonds gained 1 ticks, Crude slipped 5 cents, Gold dipped $5, and the USD was higher. Medium term support rises to the 1869 and 1841 pivots, with resistance at the 1901 and 1929 pivots. Tomorrow: the FHFA index at 9am, then Existing home sales at 10am.

Hope everyone had a good holiday. While travelling I had the chance to review the previous SPX/DOW/NAZ bull markets, going back to the early 1980’s, in OEW terms. This was to look for subtle differences between the indices. The review was worthwhile as I uncovered a few new characteristics. As a result I have updated the DOW charts to reflect my findings. This count is now somewhat in alignment with the NAZ/NDX counts: two more uptrends to complete Primary III. We will continue to also monitor the potential diagonal Major 5 count, posted on the SPX charts. One of these two will probably get us to the Primary III high.

During the beginning of the previous uptrend, we were surprised that the SPX was rallying 50 points before having any notable pullbacks. It did this twice, and then the rallies started to shorten. The current rally from last week’s SPX 1816 low is already 56 points, without a notable pullback. Looks like a new uptrend should be underway.

Short term support is at the 1869 and 1841 pivots, with resistance at the 1901 and 1929 pivots. Short term momentum is displaying a negative divergence. The short term OEW charts remain positive with the reversal level now SPX 1857. Best to your trading!

MEDIUM TERM: probably uptrending

LONG TERM: bull market


About tony caldaro

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110 Responses to monday update

  1. We got the excellent day with the A-D line up 1402 and the Russell 2k up 1.15% that I said we needed in yesterday’s post (reply to Radrian near bottom of page). It looks like the larger caps were the ones that faded out near the close today. R2k Rel Strength line has made a u-shaped bottom and turned up. I didn’t see any choppiness in R2k today so the 1147-1165 resistance area hasn’t been tough so far. I will discuss the McOs and Sum Index when those numbers are calculated by Decision Point, but you can refer back to my post of yesterday to see the basis of my argument.

  2. Weekly-AI giving a buy signal with today’s price action. Signal Will be negated with a weekly close below yesterday’s close.


  3. ariez5 says:

    GLD and GDX look promising to this simpleton. GLD made a clear 5 wave upmove beginning in January and peaking March 14. This has been an ABC correction since then, with a reversal today at about C=.5A, hourly bullish divergences, and GDX leading the way.

  4. David Eihorn pointing out another tech bubble. shorting growth stocks. I guess he will be just another pundit run by the Yellen express

  5. bobhopium says:

    Hit my target on Dow and have closed long for 429 points and have now reversed short.
    Will try to put up chart later to show what i am seeing…GL and good health to all.

  6. 777daimon says:

    Reality check for bulls:
    take the line that unites the lows from March 16th and April 14th.
    duplicate te object (the support line) and place the resulted second line as resistance line starting from the April 4th highs.
    Reality check: where are we right now, in what area, considering the resistance line? 😉 ?
    Nothing to see here, keep buying, keep buying, we’re at the lows :))))))))))

    • bhtrade says:

      The correct way to draw a channel is base trendline =Jan low to Apr low, parallel channel off Apr highs. Should we turn down from here one could then create a base trendline from ath to today’s highs and go from there

      • magicianme says:

        bhtrade, I hear what you’re saying, but I’m a big fan of Al Brooks (have all his books) and he would have drawn the channel you described as well as the one 777daimon described.

  7. uncle10 says:

    Glad you had a good vacation Tony.

    Was stopped on my short, bulls win again….😉

  8. H D says:

    if you look left you can see the 1884 R, SPX has moved 40 in 4 days from gap over 1841 pivot. Perhaps our clever little bots hiding right there (10) Tuff call w/o any volitility to assign a wave label. 1869 would help structure/ keep us in the normal PB range. IDK, JMFO

  9. AAPL earnings tomorrow after close. This is AAPL’s chance to break out of its downtrend. Disclaimer: I hold no position in AAPL — just watch it for price/direction, as it is a tech heavy-weight.

    • JK1987 says:

      jedi master, Nice chart
      To $600 at the green trend line if break out of the red with earnings?

    • mjtplayer says:

      AAPL needs to break the 4mo+ downtrend, which currently stands at $540 – $545 area. Above that and AAPL could be off to the races. Below $511 would be very bearish, if long I would move stops from $500 to $511.

    • JK1987 says:

      jedi master Thanks, you are my favorite poster here,
      Since you are an oew student, please check Lesson Three, chart #6, it’s perfectly matched, and shows you where the market is going.

      JK1987 says:
      April 15, 2014 at 3:25 pm
      I highly recommend oew Tutorial, I greatly benefit from today’s market operations.🙂
      Please check if you are an oew student, perfect matched example in Lesson Three, chart #6.

      • You, sir, have an awesome memory (Lesson Three, Chart #6). You are correct! Thank you, quite sincerely, for your compliment — truly. I also enjoy reading your posts, JK — you are a young person with much zeal and market prowess. 🙂

      • JK, you really has great memory…… So… where is market going, Dear? This old lady really like to know.

  10. jeffbalin says:

    I really can’t imagine the sp about to go into pri4, while naz has a way to go before it goes into Pri 4…… unless while the sp enters pri4, naz does ma 4, then during a big sp b wave, naz does ma5, then when the sp enters a big c wave naz just enters Pri 4 and we have some kind of crazy weird sort of c wave downtrend in the sp which could be really long as the naz trys to catch up. I don’t know. That ending diagonal is possible but I’m going with the Dow count, and expect more long and confusing minor or int downtrends or choppiness like we just had. Good adjustments Tony. You continually spot things I would never see. You’ve got the best eyes in the business.

  11. mjtplayer says:

    Nice rally off the lows, but many issues:

    – absolutely no volume, typical holiday week rally last week and into yesterday (Europe closed & Patriot’s Day here). Tuesday’s have been strong, today is no exception, beyond today we’ll see..
    – oversold conditions gone, now extremely overbought on the short-term indicators and daily RSI pushing 70 area.
    – S&P now at the 1,883 resistance area from the top of the prior trading range
    – NAZ 100 via QQQ appraoching $88 – the “right shoulder” target.
    – The QQQ also broke the uptrend from last summer, backtesting that uptrend line is also in the $88 area
    – Major astrological cycle today – “Cardinal Grand Cross”.
    – spot VIX just broke below 13 (buy signal), May contract nearing 15.

    Given all these things lining-up, it’s time to go back short. Putting back on my QQQ and IWM shorts right here with S&P at 1,883 area; buying VXX at $40.75

  12. 777daimon says:

    all seems to be bullish… no sign of the so close turn around🙂
    complacency all over the place.
    $CPC, $ CPCE and volume verifying it also.
    Traders still not fully awake of the Easter’s drinking sessions ….
    p.s. …heard that the “e” wave sometimes it truncates… just saying… check VIX – almost ending the bullish falling wedge in it’s 5th wave …
    keep your wallet next to your heart, we’re in waters full of sharks here… right here, right now.

  13. manunidhi21 says:

    Namsate Tony !
    “The current rally from last week’s SPX 1816 low is already 56 points, without a notable pullback. Looks like a new uptrend should be underway”

    hats off to you always. Any correction expected as expiry on Thursday.
    I do not see any short term -ve divergence.

  14. H D says:

    what an X wave off the lows…. :mrgreen: was expecting a zig zag, looks more impulsive. Tuesdays! USA

  15. gtoptions says:

    Thanks Tony ~ Welcome Back
    Nice work & many thanks to your students who filled in while you were away.

  16. bobhopium says:

    Extremly Bullish weekly DOW chart ….care with shorts Imho.

  17. bobhopium says:

    Greetings all…sorry tried to post an hour ago but wordpress misbehaving.
    Still holding small long from last week and still looking for Dow @16540/16560…GL to all.

  18. bobhopium says:


  19. M1 says:

    This is NAZ best rally since the correction began. 200 points.
    The correcion was 425 points.(From March to April)
    If this is a countertrend rally, we should see a short term correction pretty soon. (It could retest the lows of last week. However, its 50dma is still the target medium term.
    gl and have a great day

  20. pooch77 says:

    1147 resistance was nothing sliced right thru it.

  21. ko68 says:

    The alternate Dow count suggest int wave 3 in major wave 5, or…?

  22. Thanks Tony! Welcome back and I really hope you enjoyed the time off. It’s always good to take some distance and refresh the mind to look at things from a new perspective! New alt count makes even more sense IMHO!!

    So far all systems go, still not seeing anything bearish, but now back to cocktails and enjoying the sunset at the beach while kids are horsing around.

  23. njlin says:

    I saw your XLV chart. Primary III has already completed at 60.29. Is it possible that major A has also completed at 55.39 and the current rally is major B? or Intermediate a has completed and current rally is intermediate b? What is your target for the current rally? many thanks!

    • tony caldaro says:

      With the four major indices still in PRI III mode
      It is likely XLV will continue to extend.
      No price targets, but it could have two more uptrends as well.

  24. jeffbalin says:

    Jedi Master S,
    Thank you for all the nice posts over the weekend. It kept my brain in motion over the holidays and I picked up some great stuff, thanks for spending the time. Thanks to Soulsurfer also, the perspectives really help.

  25. bhupal777 says:

    Even in a bearish scenario Apple (AAPL) is targeting $600?

  26. bob623 says:

    Welcome back, Tony! So glad you had some quality time to spend with your family. We all need that. However, Saturday morning was not the same without your “market update.” Always appreciate you daily and weekend comments. Thanks for the many ways you help us invest and learn about Elliott Wave. You’re the best! Bob – Lynzie

  27. blackjak100 says:

    With gartman back in stocks, this is the sell signal we have been waiting for. Not sure if we get just a pullback or the selling intensifies.

    • BhProp says:

      Just think: people actually *pay* guys like him and Prechter for their horrendous investment advice

      • for the most part all you have to do is stay bullish and even if your wrong in a weeks time you will be right again. this is 2013 playbook

      • tommyboys says:

        Markets move higher 70% of the time so if you short it has to be in short term timeframes. Long term human progress moves in one direction – up. We live better than kings did just a short couple centuries ago – or less. Buying the ’00 or the ’07 top would still have had you green within a few years. Staying long term long is always the right decision.

  28. hkloon says:

    welcome back…🙂

  29. Caldaro welcome back. Nothing like Yellen ending a downtrend.

  30. lunker1 says:

    Welcome back Kotter.😀

    Agree with Dow count. With the additional uptrend any change to the timing of a top and target?

  31. WELCOME BACK!!!! You were missed, Tony!! Hope you enjoyed your long weekend. My Saturday morning was absolutely not the same without your always interesting weekend commentary. I really enjoyed reading today’s analysis — thank you!!! 🙂

  32. mjtplayer says:

    Thanks Tony, good to have you back!

  33. bhupal777 says:

    Welcome back Tony.

  34. rc1269 says:

    Thanks Tony. Glad to have you back, hope your vacay was restful.
    cheers, -rc

  35. ocaj2000 says:


  36. timing101 says:

    Thanks Mr C, it’s good to have you back. Hope you enjoyed the mini-vacation.

  37. bouraq says:

    Steep rising channels:
    #spx #djia #rut #oil #gold

  38. radrian6 says:

    Although it has managed four consecutive higher closes, RUT has not yet presented evidence of a new uptrend. RUT found support near the weekly lower Bollinger Band but the weekly BB midline is overhead near 1153; likewise with the 13-week EMA near 1150. RUT also needs to contend with strong resistance at 1147, and at 1165-72. The daily BB midline is near 1152, and the 50-day SMA is near 1166.

    As you can see, the RUT has a lot to deal with from 1147 to 1165 and I would not be surprised if it is rejected from that area. If the bounce from 1096 is really a new uptrend, RUT will retrace to a higher low then continue the uptrend — watch for support near the 200-day SMA currently at 1108.94.

    Right now, I am not as optimistic about the RUT as Tony is about the SPX. I am seeing a lot of questionable daily and weekly indications and the price action from 1096 is not as strong as the “buy the dip” rallies of 2013. Nevertheless, RUT is making its way higher so I will give it some room to challenge the very strong resistance that starts at 1147.

    • attitude928 says:

      I agree radrian6…it looks like the $RUT is due for some down before it can go further up:

    • If the market falls, it will surely take the $RUT with it. But I am more optimistic than Radrian about the R2k because in an only moderately strong market on Monday the R2k closed on it’s high of the day as well as breaking above it’s 50-day ma. The A-D line (closely related to the R2k) made a new high Monday; the McMillan Oscillator (McOs) has risen above 0 and looks as though it wants to move higher. It’s derivative, the Summation Index (SI) is now showing the beginning of an uptrend with larger gaps between it’s points. It has not yet produced what Gene Morgan of the old “Charting the Market” TV show called “breakaway gaps”, but it is only one strong breadth day, like the one we had on April 16, from doing so.

      • I am mistaken about $RUT breaking above 50-day sma. That is still 24 points higher. But it does seem to me that it overcame tough resistance in the region of 1110-1130 where it’s action was very choppy and is now moving steadily higher, as evidenced by closing on it’s high of the day. We’ll see if the choppiness resumes when it hits the resistance areas Radrian discussed above (1147-1166). If it can ascend in a steady manner through that potentially turbulent zone, that would be a huge plus and a sign that most bears on this index did their selling around the 1120 (+-10) area.

  39. John Arella says:

    Decision Time🙂, will it break to the upside or downside ?

  40. M1 says:

    Thanks, Tony.
    Nice to hear from you again after this long weekend

  41. mharrison60 says:

    Tony, I hope you had a good trip during the holidays!
    Further to the potential S&P count, is there much precedence for diagonals to truncate and complete without making a new high?
    Also looks like the FTSE has the same pattern. Thanks

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