monday update

SHORT TERM: gap up – lower lows – then up again, DOW +87

Overnight the Asian markets lost 0.5%. Europe opened higher and gained 0.4%. US index futures were higher overnight, and the market gapped up to SPX 1872 at the open. The SPX had closed at 1863 on Friday. After the open the market pulled back to SPX 1865, then rallied to 1877 by 10:30. At 10am Pending home sales were reported higher: +3.4% v -0.8%. Then the NDX/NAZ went back into selloff mode and the market started to pullback. At 1:30 the SPX had made a lower pullback low at 1851, displayed another positive divergence, and started to rally. By 3:30 the SPX had rallied back to 1873, then dipped to close at 1869.

For the day the SPX/DOW were +0.40%, and the NDX/NAZ were mixed. Bonds lost 5 ticks, Crude added 40 cents, Gold dipped $6, and the USD was lower. Medium term support rises to the 1869 and 1841 pivots, with resistance at the 1901 and 1929 pivots. Tomorrow: Case-Shiller at 9am, Consumer confidence at 10am, and the FED starts their FOMC meeting.

The market gapped up at the open today, but the NDX/NAZ growth indices then resumed their pullback that started on Thursday. By early afternoon the SPX had made a lower low for the pullback, from 1885, at 1851, for about a 50% retracement. The pattern is now clearly a complex double three: 1874-1884-1870-1883-1860-1877-1851. With the second three (1860-1877-1851) about double the first. With the SPX clearing the 1869 pivot again, probabilities suggest that Minor wave 2 may have completed.

Short term support rises at the 1869 and 1841 pivots, with resistance at the 1901 and 1929  pivots. Short term momentum rose after Friday’s positive divergence, only to set up another positive divergence at today’s lower low. The short term OEW charts flip-flopped again today ending the day positive, with the reversal level at SPX 1868. Best to your trading this potentially wild week.

MEDIUM TERM: uptrend probable

LONG TERM: bull market


About tony caldaro

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91 Responses to monday update

  1. H D says:

    Range 1,870.78 – 1,880.60, sorry, what did NDX do? Staring at 1884 again, They know it.

    Newbie, don’t let those Texans get you down. You have the facts correct, they are not correlated though. At All! Say it with me…. “USA” :mrgreen:

    Wednesday will be better I promise.

    • USA, I said it with you. Now get your head out of the sand and realize that debt as money system, the system of credit as money for consumption is fatally flawed, QE is a delay of the inevitable collapse that must come from the place called peak debt. Regardless of interest rates, no matter how low, eventually the burden of debt service becomes too great to bear.This is where we are now despite zirp…there is no escape from the gravity of debt once over the event horizon. We will collapse…it is not conjecture it is mathematical fact

      • uncle10 says:

        newbie, you have been saying this for over 300 S&P points. Maybe we collapse maybe we don’t. if you think you know for sure you are mistaken……

      • Uncle, I have been preaching this for a while, yes a couple hundred s&p points- yes. Now if I was preaching this at 700 spx than you could say I’m an idiot, but I’m stating very real possibilities that could take place at any moment.

      • uncle10 says:

        Newbie, So you are trying to help us all by giving us a warning that we may collapse. We all heard you the first time. No need to keep repeating the same thing every day or week or month or year…… Thanks!!

    • tony caldaro says:

      check out the trend line from 1897-1885-1884-1883-1881 on the 5 minute
      may need to gap over that to get rid of the NQ sellers

  2. Whats funny is a lot of people calling for a correction and we are still at all time highs on S&P. The bull case is the market does not go down. Nothing to fear in this market. We must hand it to YELLEN she has done it

    • tommyboys says:

      RUT has corrected 10% – look under the hood and attempt rationality – bull case crazy.

      • Tommyboy everytime the market is about to correct the fed comes out and talks it up. to me the fed has lost credibility even though they want 1900 on the S&P.

  3. That is the last post for the day, covered SHORT at 1873.75, lost about 3.4 handles.

    Re SHORT at 1879.9. only if close tomorrow above 1897, will cover my SHORT on Thursday…

    I am revisiting my thought that SPX wll touch 1928, it may NOT. I expected lot of fire work today, given ukraine is not any more issue. But nothing happened. Some big player is probably selling at this 1880 level, The player SELLS, waits for market to come back to that level and RESELLS …Loop continues..

  4. rc1269 says:

    AAPL debt deal blowout. upsized it and ratched in the pricing. their last bond deal marked an interim low for the stock almost to the day. wonder what it’ll mean this time

  5. mjtplayer says:

    Gold still looking bearish and now facing another Fed tapering. History of gold price action, using GLD, on Fed day and the following day:

    Dec 18th Fed meeting: GLD closed at $118.65 on Dec 17th and $114.82 on Dec 19th; down $3.83 or about $38/oz.

    Jan 29th Fed meeting: GLD closed at $120.95 on Jan 28th and $119.77 on Jan 30th; down $1.18 or about $12/oz.

    March 19th Fed meeting: GLD closed at $130.62 on March 18th and $127.86 on March 20th; down $2.76 or about $27/oz.

    The average move of these 3 “tapering” events is down about $26/oz. We’ll see what happens in gold from today’s close to Thursday’s close, but the history is clearly not bullish for gold on Fed tapering announcement’s.

    Stay short gold and watch the $1,278/80 area, this is now critical support.

  6. the weekly AI now producing a buy-signal with today’s price action so far. The daily AI never gave a real sell signal after the buy signal on the 16th, despite the 34 point drop…


    • 777daimon says:

      true, also my system is close to give a daily buy signal on a daily close above 1883.28 in cash SPX (of course, with continuation in the days after).

  7. uncle10 says:

    Thanks Tony.
    Given the banks got hit and the specs/ momos got killed (and look ready for a nice bounce up) and the market still held up pretty well makes me think maybe we do get a nice move up soon. I have been bearish— things looking more bullish to me—- keep in mind I am a short term hack so this is all relatively short term stuff. Good luck all.

  8. rc1269 says:

    Dow really looking ascending triangle-ish these days. breakout on Fed day perhaps?

  9. winslow80 says:

    Since late 2011, SPX has been reversing every 166 trading days. Yesterday was Day 166, and SPX held the 50 day ema. This creates a higher low under which to raise a sell stop for those who bought support at 1814. Still targeting 1947.

  10. Stocks on my watch list all moving up. Not a buyer here, however. Too many stocks were flat out broken. Looking to short again at the next signal. Many of the stocks I shorted went down with gaps. I’ll watch them get filled and take a stab at shorting again. Good luck everyone.

  11. simpleiam says:

    Looking Good! And IXIC out in front percentage-wise too! Should it fall back, I’ll buy more. GL to All! (Even Newbie, who doesn’t trade anything a thinks he’s the only one that has a grip on reality, and the rest of us are blind… Sheesh.)

    • Simple, I do trade ( Not sure why you would lie and say I don’t). Our views our different and that’s what makes a market.

    • simpleiam says:

      newbie, no lies here. Perhaps I don’t recognize your trading because all you post (that I’ve read) is apocalyptic trash that you think nobody else has heard or knows about.

      Simplify and Good-bye!

  12. gtoptions says:

    Thanks Tony
    I’m no statistician, but I’m sure someone has numbers on how many times a WPP is tagged during FOMC week. 😉
    I agree with Tony, the majors are now aligned and they should move higher shortly.

    • I would like to share 3 facts on the federal reserve:
      #1 The greatest period of economic growth in U.S. history was when there was no central bank.

      #2 The United States never had a persistent, ongoing problem with inflation until the Federal Reserve was created. In the century before the Federal Reserve was created, the average annual rate of inflation was about half a percent. In the century since the Federal Reserve was created, the average annual rate of inflation has been about 3.5 percent, and it would be even higher than that if the inflation numbers were not being so grossly manipulated.

      #3 Even using the official numbers, the value of the U.S. dollar has declined by more than 95 percent since the Federal Reserve was created nearly 100 years ago.

      • gtoptions says:

        My trading methodology is based on reality. Historical facts, like those you state, do not fit into a realistic or productive investing profile. GL

    • Historical facts are reality. Those who cannot remember the past are condemned to repeat it.

      • gtoptions says:

        #3 Risk aversion is the cardinal rule.
        Enjoy your short position 😉

      • tommyboys says:

        Newbie checkout these sites (got lots more if you like) – you’ll really enjoy these.,,, &, Have fun and thank me later…

  13. rc1269 says:

    why does it feel like we’d be at 1780 if we factored out the gap openings so far this year

  14. Large caps masking real deterioration in growth stocks underneath. How long can the big boys hold up? That said, the % of NASDAQ stocks trading below 50 day MA is not far off the May and Nov 2012 pivot lows either…. many values out there for fundamental pickers it seems.

  15. John Arella says:

    Expanding Triangle Correction expected 🙂

  16. Before this weekend, if SPX does not break 50DMA, then it will be FIRST 1928. However, before rising to 1928, SPX will touch 50DMA and then bounce back. Therefore, when it touches 50DMA, keep close watch. Good news is it is not going to 1804 as I thought earlier. If it breaks 50DMA decisively, it will reverse at 1840.

    If SPX touches 1928 in next 7 trading days, then that is the TOP of the year. In next down cycle (after 1928) SPX will break even 200DMA as well by 10s of points to south.

  17. magicianme says:

    Bond yields are strong, USDJPY is strengthening, gold is weakening, there is a decent sized POMO today … and it’s Tuesday. Why then do I have the feeling that it’s a dangerous time to go long on the S&P? Yesterday’s volume was high (though average trade size wasn’t!) but I can’t help feeling it was a head fake. There’s a possibility today turns out to be a ramp up followed by a drop to make it the first down Tuesday in a long while.

    Beyond today’s action, it’s still obviously a bull market (… till it ain’t). Rashke waves (Wolfe waves) anyone? It worked perfectly with the 8th April low and the 10th April high to forecast the exact point of the 24th April high. The reverse is now shaping up which aligns with Tony’s ED i.e. a rise to 1900+ followed by a sharp drop headed towards the 1800 area. A dangerous time to be holding longs, IMO.

    For those of you seeing an IHS – guys, an IHS is a pattern you look for at the trough, not at the ATH!

  18. torehund says:

    Obama has a sleazy/snakey way of fighting his enemy. Sanctioning against Putins staff isnt Nice to do, and must irritate Putin a Whole lot. If you sanction you do it towards the country not individuals.
    That said, the Whole Russian population got ripped off; they got “freedom” and the few took anything of value. Obama looks more and more like a screaming squirrel :

    • budfox9450 says:

      It has been a tough “time period”,

    • the country of Russia’s only asset is “freedom” as you keenly state……hence the sanctions against certain individuals who control all the hard assets…… Jesse James said, go where the money is

  19. ocaj2000 says:


  20. bhupal777 says:

    Thanks Tony. In considering SPX is following ED count, does this pullback from 4/22 qualify for the ‘b’ wave of ‘E’ Wave?
    Another general question. In counting waves do you prefer to consider intraday price or closing price. For example Wave 2 retraced below the Wave 1 when considering the intraday price but didn’t retraced the start of Wave 1 when considering the closing price. In that case which one would you consider? I have this dilemma today in counting TWTR. Thanks in advance.

  21. There is an indicator which has been discredited for years that has correctly predicted the direction of every index I have looked at since this bull market began in 2009. For the $SPX, IWM, $COMPQ, and probably for most other Indexes or index-like ETF’s , it is still looking strongly bullish today. I don’t want to say what it is, because I don’t want it to get too much of a following. A clue is this: What has been a major criticism of this bull market since it’s inception.

    • Bulls will in no way get out of this unscathed, Do you guys seriously think you will not be holding Long when the rug is pulled out from under you? Made sense to be a bull several hundred S&P points ago but NOW- you are playing Russian Roulette.

      • I admit that I am a nervous and cautious bull. In no way am I confident that my bullish view of the market is a sure thing. Even the indicator that I referred to above is subject to becoming invalid if the professionals and institutions have already taken notice of it. If the big money is already aware of it, then maybe it doesn’t even matter if the retail public knows, too. That is because, on a secular basis, they have come to represent an increasingly smaller percentage of the money going into the market. However, I would like to find reliable information on the cyclical level of participation of the general public (the small investor).

    • tommyboys says:


    • tommyboys says:

      Volume – (posted in wrong spot)

  22. Radrian6: I doubt if you saw my response to your reply to my McOS-SI post so I am posting the dialogue here:
    radrian6 says:
    Thank you, George. McO has been bouncing from -120 to -150 so I would be surprised if it held at 0.
    georgeschaeffer says:
    April 26, 2014 at 4:07 am
    I am talking about the NYSE McOs as rendered by Decision Point on Since Feb it has fluctuated between -60 and +65. Some other versions of the McOs use a different numerical scale.
    mjtplayer says:

  23. Just reached home, SPX limit order sold at 1870.6, looking at jump, it is better to book loss tomorrow..

  24. I have not done well with Elliot tracking the indices but very well with actual stocks. my count on FB, AMZN and NFLX have the going a lot a lot lower.

  25. simpleiam says:

    Moving to Plano, TX. Almost can’t get anymore upscale. Might find talent w/former HP personnel who still reside there.

    Last post.

  26. Tony

    It is too early to call it the end of 2 today.
    It can also be the end of 1 of C (in a downwards count) – only lower high+lower low.
    We need either a close above the recent high of 1885, or a breakdown below 1850, respectively.

  27. Thanks, Tony! What a dizzy day! Doesn’t look like the NAZ will get over its 10EMA on the weekly … and dangerously close to breaking its long-term trendline. The party’s over when price breaks its trendline. If earnings can’t kick this up, what’s the catalyst? Price is consolidating right here for a bigger move.
    NAZ Weekly:$COMPQ&p=W&yr=2&mn=0&dy=0&id=p45473693708&a=347538242&listNum=7

  28. bobhopium says:

    Thanks Tony and greetings all….Here are my current thoughts for those interested.
    Still very bullish and I see synchronising bullish structures aligning on a global scale.
    I am now positioned long in Dow,Ndx,Nikkei and Dax. and am looking for substantial Upthrust thru the sideways/consolidation phases seen building since the beginning of the year and this would appear to concur with Tonys current bullish stance…Good health and Good luck to all.

  29. Lee X says:

    Thanks Tony

  30. H D says:

    Nice update Tony, SPX hit HWB and rallied hard! Market is so fast and dangerous. Today was LH and LL. Trying to put it as 3 of 3 up still seams the most dangerous, for me. Has been since March. Perhaps 1851 is the new bullish above/bearish below. Should that hold & get a HL against then I could consider the most bullish 3 of 3 up scenario. Otherwise, too choppy and dangerous to rule out DOW count. Major Astro event and FOMC next 2 days gives little room for any large hit in the 3 of 3 up. So good news we don’t have to wait long to find out.

  31. bouraq says:

    Another roller coaster day:

  32. With the SPX clearing the 1869 pivot again, probabilities suggest that Minor wave 2 may have completed. Thought SPX needs to clear 1876 to clear 1869 pivot!

  33. radrian6 says:

    Another day, same bipolar market. Since the peak of March 4, neither side has been able to control the RUT for more than three to five days which suggests that longer-term traders have been booted out of this market. The bias is still clearly down but given all the overlap, I have problems calling it a “trend.” Support remains in the 1083-1095 zone, while resistance is now near 1160 where the last two rally attempts failed.

    Today, RUT once again tested the weekly lower Bollinger Band and the 200-day SMA and once again, the support held. RUT is oversold based on RSI(5) and since the bears have owned the RUT for four days, maybe the bulls will take over for the next few sessions. I would be more comfortable with a rally if the RUT flushed down to 1083 then bounced out — until that happens, I will remain skeptical.

    For the longer term, I still believe that RUT has put in a significant high and the best it can do now is trace out the right shoulder of an H&S top — recent price action and seasonal behavior support that belief. The ideal right shoulder would match the January high of 1184 but the RUT is sloppy at this time so precision and symmetry are out of the question. So, if RUT clears 1160 resistance then rolls over before it gets to 1194, that’s probably a right shoulder. There are other pattern possibilities such as triangles, but I still favor the H&S for an ultimate top. If were going to make a cycle low in the July time frame, RUT should break down in May — maybe after expiration.

    • simpleiam says:

      “…I would be more comfortable with a rally if the RUT flushed down to 1083 then bounced out — until that happens, I will remain skeptical.”

      I feel the same way. It might still happen and wouldn’t doubt it. GL to All!

      • radrian6 says:

        Good to hear from you and I hope you’re doing well. The RUT is very tough right now because traders on both sides are shell-shocked. To me, the neckline of this potential topping pattern is 1083-1095 so the technician in me wants to see a test — today was close but not quite.

      • simpleiam says:

        Agree ra6. Close test, but no cigar, which keeps me thinking suspiciously.

  34. attitude928 says:

    TNA PRINT suggests that the $RUT reverses and begins an uptrend tomorrow. Nice H&S call Jedi.

  35. simpleiam says:

    Thanks Tony. A temporary drop in volatility & XIV might be an interesting play here, but still thinking it over.

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