tuesday update

SHORT TERM: gap down Tuesday, DOW -130

Overnight the Asian markets open gained 0.3%. Europe opened higher but lost 0.6%. US index futures were lower overnight, and at 8:30 the Trade deficit was reported lower: -$40.4bn v -$42.3bn. The market gapped down at the open for the second day in a row. It opened at SPX 1879, dipped to 1876 by 10am, and then tried to rally. The market had closed at SPX 1885 yesterday. After a bounce to SPX 1881 by 10:30 the market headed even lower. At 3pm the SPX hit 1868, bounced to 1872 by 3:30, then closed at 1868.

For the day the SPX/DOW were -0.85%, and the NDX/NAZ were -1.35%. Bonds gained 2 ticks, Crude added 15 cents, Gold slipped $3, and the USD was lower. Medium term support slips to the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Tomorrow: FED chair Yellen testifies before Congress at 10am, then Consumer credit at 3pm.

The market gapped down at the open, just like yesterday. But unlike yesterday, when the market dropped 14 points in the first few minutes and then rallied for the rest of the day. Today, the market dropped 9 points in the first half-hour, bounced, and then declined for the rest the day. Yesterday’s low was SPX 1867, today’s low 1868. In between a rally to SPX 1886. So far it looks like a Minute wave ii flat. The entire pullback from SPX 1891 can still stretch into a zigzag if it goes much lower. No change in the count unless the OEW 1869 pivot range is broken. Two days of FED chair Yellen testimony next.

Short term support drops to the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Short term momentum ended quite oversold. The short term OEW charts continue to flip-flop ending the day negative with the reversal level now SPX 1878.

MEDIUM TERM: uptrend probable

LONG TERM: bull market

CHARTS: http://stockcharts.com/public/1269446/tenpp

About tony caldaro

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168 Responses to tuesday update

  1. VIX Smash and S&P and DOW at ALL time highs. LADIES and Gentlemen Janet Yellen

  2. Risk vs Reward, enough said.

  3. magicianme says:

    For all you bulls – nice IHS formed on the S&P. It’s most clearly visible on tick charts rather than time charts (try a 10,000 tick). Hope that works out for you. I’m out for the day as I don’t trust that IHS.

    • tommyboys says:

      Interesting that this little IHS neckline is the same neckline as the larger one drawn from early April. This line was support and now resistance. Really been hovering back around it now for almost a month. Something has to give soon – either way.

  4. llerias7 says:

    Tony, can you fill me in about the EW count on NDX and R2K? Acording to your charts NDX is in a 5th of a 5th. wave? And R2K the same?
    Thank you.

    • tony caldaro says:

      NDX/NAZ should be in 3 of 5, R2K probably 5 of 5.
      As soon as we put in a bottom in TWTR think the techies will run

      • tommyboys says:

        Tony does TWTR really carry that much weight with the Naz?

      • tony caldaro says:

        No, it is just a matter of sentiment.
        The NDZ/NAZ had similar problems in 2012 when FB had its waterfall.

      • pbnj123 says:

        Any chance this is just all to free up cash for the the 800 pound IPO coming to a trading desk near you? 🙂

        • tony caldaro says:

          Alibaba, and the forty thieves?

          Just looks like the MOMO players, who were driving up techies for a year.
          Are now driving down techies, using the less liquid NDX to do it.
          When the NDX/NAZ hit its high on March 6th, the SPX was at 1882.

  5. bobhopium says:

    Hey all…Fwiw still bullish here and, my charts suggest to me we are at the start of a decent global summer rally and I have added to Nikkei,Dax and Usa longs…Upthrusting breakout to new highs should be a sight to behold…Aimho and Good Luck/Health to all.

  6. As I stated this morning the 2 things that would shock me.

    May 7, 2014 at 8:51 am
    I think the 2 things that would shock me today with Yellen speaking would be the vix having a big up day and market having a big down day. Yellen deserves credit she is managing the markets emotions very well. Putin also helping bulls today

  7. IMO….We are on verge of Big Down targeting 1795 , if so buckle up

    • JK1987 says:

      iman ew bi etrader,
      Why are we on verge of Big Down?
      Why targeting 1795?

    • Kevin M says:

      Newbie-I’ve got for the SPX a downside target of 1638-1650 ish by late June/Early July. Fib #’s will provide this move down a solid number. From the low of 1737 to the high of 1897 in early April x 1.618 to get 1638 of a target. This will happen. The writing is on the wall. I would not be surprised that once the trendline from Feb to mid April gives way, it will be a cascade down. Should be quite a sight.

      Take care…

  8. gtoptions says:

    SPX ~ 1857 would be the perfect symmetry setup, with +/div on the hourly.
    It can rally here, but with the RUT & COMPX weakness, I can’t see it at this time.
    3x GLTA

  9. gtoptions says:

    Janet Yellen’s nervous twitch reminded me of this song. Gotta love her.
    She’s got lots of secrets! 😉

  10. Last post for today. IF yor a bear the S&P and DOW have to frustrate you. VXX is telling you there will be NO CORRECTION in the S&P. I just wonder how much longer American can be lied to?

    • budfox9450 says:

      No, not really. Makret tops take time, but,
      their trail of decay, is very visible.The
      $NYHGH new highs reached 700, in late
      2013, Now the last post is 183, quite a come
      down, or loss of strength…I am a long term,
      or Primary trend investor. P3 is closer than you
      may think…..

  11. jeffbalin says:

    2 points.
    1 Don’t understand the gang up on Simple.
    2 Tony, is a zillion times smarter then you know.
    Don’t respond to this post. Everybody study, learn and chill out.

  12. 16golfer says:

    Kudos on the trade CN!

  13. extra short time, + div. so far

  14. pbnj123 says:

    Radrian6 – RUT weekly displaying a divergence?

  15. JK1987 says:

    Minor 2 probable?

    I posted on the blog Minor 1 at 1891.
    JK1987 says:
    May 2, 2014 at 9:36 am
    Tony Thanks
    I see five up from 1814, Minor 1 probable?

    JK1987 says:
    May 2, 2014 at 12:45 pm
    I highly recommend oew tutoring program.
    I have learned and benefited much more than I have learned in the past, wish I have started the program much earlier. Still learning …

  16. Perfect Yellen nails it Prices have soared and has choked off demand for housing and is crashing discretionary income for most folks. uptrend probable

  17. JK1987 says:

    OEW 1869 pivot range is broken, ii still ok or any other alternate?

  18. I think the 2 things that would shock me today with Yellen speaking would be the vix having a big up day and market having a big down day. Yellen deserves credit she is managing the markets emotions very well. Putin also helping bulls today

  19. I agree with Caldaro with his uptrend probable count. With Yellen speaking today uptrend is probable

  20. Order to sell SPX at 1875.6, earlier it did touch 1876+. Hope it goes there..Once sold, there are going to be tense moments…

    • Sold, in moment covered at 1874.9, only to see it going lower at 1873.7, New SELL order, this time at 1876.4

      • lunker1 says:

        Posting micro daytrades doesn’t add value

      • Thats the last post for the day

        I am said micro trades dont add value. Now, I am not like that old man (warren buffett) who fears copycat investing and asks SEC to not publish his buy/sell immediately.

        I expect everyone to benefit.

        Anyway, your “SnakeOil”target (1902 SPX) is scheduled bfore THIS weekend

      • WOW, shrihas, take a moment and read your own comment… can your ego get any bigger?

  21. gtoptions says:

    Thanks Tony
    The bickering does nothing for me. 😉
    SPY ~ Range Bound & RUT ~ Testing Fib Fan Support again.
    GLTA ~ Play Nice.

  22. Kevin M says:

    Like I said yesterday, the market will rally here until next Monday(ish). I think we get above 1891 and then it’s lights out folks. Down hard into the end of May, a tiny rally into the first part of June and then down hard most likely below the 1737 by end of June/first part of July. Fund managers are going to dump their losers by end of quarter. You want to wait and buy the first part of the third quarter folks.

    Again, tony will switch his wave count and look like a genius.

    Take care…

    • tony caldaro says:

      Thank you for your market opinion.
      Tony, btw, has three potential counts with the most probable posted on the SPX, and least probable on the DOW. The middle count is posted on DDM.

    • chrisk44342 says:

      And here I thought it was impossible to predict the market. Oh yeah it is.

      • chrisk44342 says:

        Hard to believe Tony can stomach this. I actually pity this guy because his flaw is not in believing Tony is wrong. It’s in believing that anyone can accurately predict what’s going to happen in the future. Roadmaps Kevin. That’s all you get in life

      • Kevin M says:

        chrisk44342-Hey You said it I didn’t. You’re speaking to the choir. Your assumption on me is unwarranted. Roadmaps? Really? ok……

  23. simpleiam says:

    Last post (for a while).
    Upro up almost $1 from yesterday’s close in pre-mkt this morning, so something must be rallying.
    GL Everyone! HAVE FUN!

  24. buddyglove says:

    The great Janet Yellen short cover coming soon….again.

    • buddyglove says:

      Also the Yawngay has blogged one of his tiresome apocalyptic Tome’s that no-one ever reads (see below). However the now rare appearance of the Yawngay has triggered some mega rallys in the past……..Aimho and conditions apply.

    • 777daimon says:

      never knew an old lady can excite such a great number of young adrenaline-pumped traders :)) … platonic gerontophilia, I guess :))))
      I’d be more careful, the “market spike when FED head is speaking” is just another myth. Lately I observed a somewhat post-modern deconstructivism of myths (“turning Tuesday” and others) … be careful!

      • tommyboys says:

        This is correct. Turn around Tuesday myth busted so what next? These “patterns” only work ’til they don’t – including supposed seasonality and election cycle etc… Once too many follow something else happens.

  25. lunker1 says:

    Relax people. Some seek attention, some seek praise. Some like to boast and some like the fun. But in the end how much of it really mattered?

    • magicianme says:

      “Some seek attention, some seek praise. Some like to boast and some like the fun.”

      Some rely on Putin, some pray to Yellen, some wait for an upside down bottle of dandruff shampoo to do its thing. Some are all about Vix, some the (n)Flx, some just TWTR or MOAN. Most are of bovine persuasion, some of bovine, er, derivation and there are some we can hardly bear 🙂 .

      But it’s ALL good fun. Pure gold.

    • simpleiam says:

      “…some like the fun….”

      Yes, it IS fun!
      Ya’ll have a good day now, ya hear?

  26. njlin says:


    From your USD chart, USD seems to be in the intermediate c of major c of Primary B downtrend. What is your target for Primary B ? Many thanks!

  27. Made a mistake, SHORT covered at 1771.05, I hope it comes above this level ASA granny speaks..I will reshort..I am panicking now that it may not come back above 1871 in this down wave.

    My strategy is, if it does not go above 1871 today, then reshort at whatever level by end of the day today.

  28. ariez5 says:

    Tony, with all respect, if you are maintaining this is a (minor) 3 of (intermediate) 3 – I don’t think it passes the smell test. Third waves are supposed to be strong.

  29. theyenguy says:

    Yes indeed, Gap Down in the Dow.
    Your blog has been consistently bullish, it fails to recognize pivotal changes.

    On May 6, 2014, Investors commenced the deleveraging and derisking process in earnest, as the currency traders drove the $US Dollar, $USD, to a new 2014 low of 79.15.

    The US Dollar, $USD, traded by the 200% ETF, UUP, fell vertically lower at open, with the result that the Major World Currencies, DBV, traded to a rally high, led by the British Pound Sterling, FXB, and the Australian Dollar, FXA, which stimulated Australia, EWA, to trade higher. The Euro, FXE, sprang higher to close at 137.52. Emerging Market Currencies, CEW, traded to a new rally high. The chart of the US Dollar, $USD, closed strongly lower at 79.15.

    While Aggregate Credit, AGG, traded unchanged at its rally high, junk Bonds, JNK, Emerging Market Local Currency Bonds, EMLC, International Corporate Bonds, PICB, and World Government Bonds, BWX, traded to new rally highs. The 10 Year US Government Note, TLT, traded slightly higher, but closed below its recent rally high, as the Benchmark Interest Rate, ^TNX, closed at 2.6%.

    The death of credit, and the pivot from the experience of investment choice into that of debt servitude, which commenced in April 2014, as the world central banks passed the rubicon of sound monetary policy and turned “money good” investments, bad, is seen in Global Financials, IXG, trading lower, intensifying as the National Bank of Greece, NBG, led Greece, GREK, as well as the Regional Banks, KRE, the Too Big To Fail Banks, RWW, and the Stockbrokers, IAI, led the US Small Caps, IWM, in particular the Small Cap Pure Growth, RZG, US Infrasturcture, PKB, Metal Manufacturing, XME, Nasdaq Large Caps, QQQ, and Retail, XRT, lower.

    Now, all fiat equity investments are following Global Financials, IXG, in trading lower. World Stocks, VT, Nation Investment, EFA, Small Cap Nation Investment, SCZ, New York Composite, NYC, and Dividends Excluding Financials, DTN, as well as the Defensive, DEF, Utilities, PUI, Consumer Staples, KXI, International Energy, IPW, Energy Production, XOP, and Real Estate, IYR, are commencing their fall lower into the Pit of Financial Abandon on the failure of trust in the world central banks monetary authority to stimulate ongoing investment gain, as well as global economic growth; this as Zero Hedge posts Global Manufacturing PMI Plunges To 6-month lows.

    • makiori says:

      Which commenced in April 2014 as the world central banks…. Ummmm not quite: the original sin was commuted by Greenspan in 1998 on the back of Russia/LTCM, and given that the sin went unpunished, his successor Mr. B. decided that he wanted to be the biggest sinner in the history of human kind, and boys did he print! His successor so far, is just dealing from the aftermath of the above. Still printing albeit at a lower rate.
      2014…yeah right

    • The ETF “UUP” is not 2x USD but 1x.

  30. uncle10 says:

    Hahaha. This is a funny blog!!!
    Thanks Tony.
    Close above 1885ish bullish, otherwise staying short.
    I hear talk about the Fed. and PPT etc. the computers are in charge and no one else.
    Good luck all.

  31. Thanks, Tony, for another day of analysis/sharing. Reading your commentaries is an enjoyable staple of my evenings.

  32. budfox9450 says:

    The SP500 Index, BoYu indicator, Daily, and Weekly
    are in Sell modes. Monthly is now Neutral, at best.
    While the SSO is looking very toppy. The XLY
    remains on a March 2014 sell signal….Bud, no
    further comment/replies

    • Kevin M says:

      Bud can you explain your BoYu indicator? Are we supposed to know this indicator and it’s components?

      I’m at a loss here, help me out.

      • perceval7 says:

        It’s his personal system he developed. Now and then Bud lets us know what direction the dials are pointing…….very useful input IMHO. Thanks Bud.

      • JK1987 says:

        fyi 99% of time bud posted his BoYu indicator as sell.
        I only saw one time as buy, near the top.

    • budfox9450 says:

      In the last week, I have attempted to
      offer a free chart, using my email address,
      that was not allowed. Encid….

      • budfox9450 says:

        JK appreciate the comment, What you do not
        see, is the the huge topping pattern, that we are
        seeing currently – not unlike the 2007, or 2011
        top. So, your comment is unfairly slanted, because
        you cannot be allowed to see what I see. Try
        a special stochastic I often use – Stoch 82%K, 3,2

  33. RDC says:

    Thanks Tony.

  34. simpleiam says:

    16golfer says:
    May 6, 2014 at 8:14 am
    The bulls might just get gored here. Pigs get fat…Hogs get slaughtered.

    OMG!!! What a catchy, original quip! I’ve never heard it before…

    Hey golfer, I was driving by The Hermann Park public golf course today and saw you out there swatting ’em. What a nifty, thrifty way you have of retrieving those little balls from the water!

    • 16golfer says:

      Never heard of Hermann Park. Is that a public course for hackers located in low income neighborhood? Have to watch those hackers on public course….might get hit with a wayward ball. Better stay in the private country club area….

  35. scottycj1 says:

    5 waves down on 15 min chart–ED CIt tomorrow

  36. torehund says:

    Tx Tony. Today looking at several bulkers they have made come abc patterns that seems to be ending, and Your Diana shipping closded the gap finally today.
    As one of my shippers GNKOQ worked on a KEY reversal With some hold to itself and a multimonth large ABC had already ended (GNKOQ could be on wave 3 from bottom mid March). I added to the tiny high beta Free shipping as it has served me well before when a downturn seems to be at an end or imminently close. What is Your take on Bulk nowadays, and what do other Board members think !

  37. Chart lovers will appreciate this. Just heard on TV (coincidentally, while husband flipping through channels) that ODP was up over 15% today on earnings. Well, since I love charts, just had to go look at it on a chart and laughed out loud after drawing the trendline (see below). This is manna from heaven. MACD is below the centerline, SLOW STO overbought, price rejected at top of a down trend line with a long topping tail. Guess what stock is on my “short it” watch list. Good luck to all on all your trades.

    • simpleiam says:

      Nice setup, jedi. Hope you have as much gain as I got w/TWTR today. It was a great, fun trading day! I’m hoping for spx into 1840’s to buy the dip.

      • Congrats, Simpleiam! None of my shorts were down 15.5% or more today — the most today was 5.5 and averaged out at 3.5. Each day of the small gains, however, does add up — better than losing. I can’t day trade, as I work, so have to buy/hold for swing trade. Keep up the great work! 🙂

      • H D says:

        Simple dude- do u even realize how ridiculous you sound, even after 5 beers. You can’t come in premarket and cheerlead for the bulls saying you hope shorts get “squeezed to death” and “most stocks up premarket” and then come in after the close saying you nailed TWTR. Of all things TWTR? Who do you think we are?

        I’m out. Sorry Tony for the rant. The conversation here use to be about EW. I can’t take the BS anymore. Hiatus.
        Best to you and yours.

      • simpleiam says:

        jedi, I got lucky, as it doesn’t happen every day. I didn’t get all of what I wanted, but the group that I trade with a couple times per week gave me enough guidance to have come out better than worse, and have fun doing it.

        HD, dude, believe whatever you want. My comment about shorts getting squeezed was directed at those who might be shorting the indices, or other assets w/ALL their cash. I’ll feel free to come in pre-mkt and thereafter with comments as I see fit. The market swings have been quite hard for a number of months now; you act like it’s impossible to play both.

        If you don’t like me, you can stop replying to my posts at any time; doesn’t hurt my feelings… Dude.


      • simpleiam says:

        PS, the vast majority of credit belongs to Tony’s guidance.

      • RDC says:

        hmmmm …. so “Simple” has been double crossing us? Not simply nice.

      • H D says:

        You equivocate every post and fool no one. You claim to trade your IRA, don’t day trade, etc, yada yada yada.

        Should I go on. You’ve been boldly telling bears to go away and now you have 1841 in sight. I will have another beer. You amuse me.

      • CygnetNoir says:

        HD, I feel your pain. And unlike you, I don’t drink, so nothing to drown my sorrows in ;(

      • blackjak100 says:

        Simple…I read your post and kind of thought the same thing as the others so I’m going to offer my opinion in 1 post of how to handle it next time. I have no problem when you toot your own horn about TWTR. However, you back it up with nothing. Present an EW setup and then toot your own horn when you get it right. I think Jedi sets a pretty good example as she’s constantly posting charts and explaining why she’s long or short.

      • simpleiam says:

        Nonsense RDC, but you believe what you want. I was as surprised as anyone when stocks started to drop.

        The comments don’t affect my brokerage account in the least, but Tony, and my futures trading buddies do. Think I’ll take Tony’s advice though and not post any trades from now on. Or info on what direction I’m going either.

        Have fun with Kevin M. and imawannabetrader.

        Still Simplifying!
        Signed: NOT a Dude

      • Lee X says:

        Thanks dude

      • H D says:

        simple- YOU HAVE NEVER POSTED A TRADE-EVER. in realtime
        please keep posting about the beach though. We all benefit from that.
        sheesh Don’t get ur panties in a wad when we call you out on your flip flops. Be a man and own it.

      • simpleiam says:

        now you have 1841 in sight.

        Oh, what a great buying opportunity!


      • simpleiam says:

        Wa, Wa, WAAAAAA! LOL!

    • simpleiam says:

      bj, sorry I didn’t make myself understood; I do apologize to you for that. What I don’t apologize for is turning on a dime, which I often do, as market dictates; it doesn’t bother me a bit. I’m not a daytrader, by the classic definition and only trade with a small percentage of my money. I did not reap a fortune today, I assure you.

      No worries now. I won’t be posting ANY trades. Think it’s better to stick with reading Tony’s private blog and post and trade on my futures trading blog. GL to You!

      • blackjak100 says:

        Simple you’re making it difficult, I think posting trades is fine if you can back it up with EW, OEW, etc. Show us something that can benefit all of our trading. It doesn’t require posting charts or anything. Tell me why you would buy the dip at 1841 besides the fact it’s an OEW pivot. If you ask me, trade below 1851 would be very concerning from an EW standpoint.

      • simpleiam says:

        bj, you’re mistaken. If you go back and read posts I’ve blogged here, you WILL SEE REAL-TIME trades by me, including uvxy, xiv and others. My VIX trades always seem to p1$$ some traders off here. You’ll have to dig for them yourself.

      • blackjak100 says:

        How am I mistaken or have I had too many beers? You’re missing the point. I’m 99% sure you don’t back up anything you say with EW evidence, OEW, classic TA, etc….I gave you a chance just now to answer why you would buy the dip at 1841 and got nothing in response. People will respect you if you start doing that whether you get it right or not.

        Anyway, I’m done for tonight and going to have a shot of Winter Jack even though it’s spring.

      • Kevin M says:

        Simple-You should take a vacation over the next few months. your account is going to take a hit I can assure you. Relax….drink a little if you must and read a good book. Wake up next year and be that much more richer.

        Think then trade

      • simpleiam says:

        “I gave you a chance just now to answer why you would buy the dip at 1841 and got nothing in response….People will respect you if you start doing that whether you get it right or not.”

        bj, I don’t care about respect or the chances you give me; like you own the joint? I’m too old to give one $h1t about it; and obviously some other posters who never post trades here don’t care about respect or what chances other posters here give them either. I can deal with it. Have a 2nd shot and sleep well.


      • simpleiam says:

        May 6, 2014 at 9:29 pm

        Simple-You should take a vacation over the next few months. your account is going to take a hit I can assure you. Relax….drink a little if you must and read a good book. Wake up next year and be that much more richer.

        Think then trade

        Hello Kevin. Please promise me that you’ll post here every day, all day long and never stop!!! I don’t care about your advice.

        I’ve got to get things ready for tomorrow, so you have a good time posting.


    • simpleiam says:

      Thanks F. Very constructive information.

    • blackjak100 says:

      Very informative Fiona! I love statistics and it shows the ED has a high probability However, we need to stay above 1851 and get this third of a third wave going above 1900. Preferably, a zig zag to 1860ish is playing out and will complete Wed early.

  38. ocaj2000 says:


  39. bouraq says:

    Bear power:

    • simpleiam says:

      Thanks bouraq. 1840’s is good. Was hoping for a hit at the 1841 pivot to buy the dip.

    • blackjak100 says:

      Bouraq, I still think gold goes lower towards $1200. If we break above $1316, b wave is incomplete and could head towards your target of $1350. I don’t see it very bullish as it’s been moving sideways for almost 5 weeks after a $100+ drop in a short period of time. I think to get really bullish, we need a move above $1392.

      • bouraq says:

        I have been bearish for a long time on gold BJ but looking at the miners and the recent breakout perhaps it is time to see the other side of the trade. As long as the red channel candidate is in tact I don’t see much lower prices from here.

  40. blackjak100 says:

    Tony, minute ii can’t be a flat since the ‘b’ wave didn’t retrace 90% of the ‘a’ wave. It has to be a zigzag targeting 1860ish which corresponds to the 78.6% retrace. This is a common retrace level after leading diagonals which the ‘a’ can be counted as. Cheers!

  41. $CPCE equity put call ratio .65

    Bearish sentiment might be getting to the point, where the markets moves higher.

  42. radrian6 says:

    An auspicious day for the bears with RUT closing below its 200-day SMA for the first time since November 2012. The last time RUT took out its 200MA, it continued sharply lower to finish an ongoing correction. Currently, RUT has more complex support in place which may not give way as easily. Resistance is now 1128-1138 while support remains at 1100-1095. RSI(5) is oversold so we’ll see if RUT stabilizes around 1100 — it may need some help from the other indexes and that’s asking a lot right now. The weekly lower Bollinger Band is near 1099 and there may be a positive reaction from that area. May options expiration is very close so there may be some price flattening next week.

    • jparkins10 says:

      Rad, we often see a low on the Thurs/Fri before OPEX week, so still time for lower levels to be discovered, & as well, Mon-Wed of this week is historically weak, so another “fact” to support lower levels?
      It’s also curious, to me anyway, that Primary II started around this time in 2011, just a titch earlier at May 1st. Having said this, RUT has already seen around a 10% correction, whilst SPX is barely off the highs, so quite different construct than 2011. Not quite sure what to make of this.

      • pooch77 says:

        Rad,would you go long as weekly chart bottoms out? Daily looks to go to 1060 before it hits bottom territory,rsi 28-32

      • radrian6 says:

        Hello JParkins! I haven’t heard from you in a while; I hope all is well in the UK. Yes, RUT can certainly test lower here although, with all the support elements between the current price and 1079, there’s a good chance for a relief bounce into OpEx.

        I still feel the correction is ongoing and, if the neckline breaks, RUT could target 990-950. The divergence with the cyclical indexes is puzzling but time will sort out the discrepancies.

      • pooch77 says:

        I would long at 2 hour rsi 26-28, daily 30-32, weekly 40-42..

      • jparkins10 says:

        Thnx Rad, always look for your posts, your input is much appreciated.
        Haven’t been posting much, busy getting ready to move out of central London, after 17 years of living here.

    • pooch77 says:

      IWM 106-107 level

      • radrian6 says:

        Hey Pooch — it is certainly possible for the RUT to form a classic H&S top here but it will first need to test 1083-1079 before bouncing into the right shoulder. That test could produce a decent low on the daily and weekly charts and support a sustained rally — the left shoulder formed over a number of weeks and I would expect time symmetry with the right shoulder. RUT could undercut the 1083 neckline but I don’t know if it will make it as low as 1060.

  43. pbnj123 says:

    Looks like an ending diagonal from today’s high to low
    Cheers Tony

    • CygnetNoir says:

      to anyone who followed me into the NFL X put trade yesterday, there is no shame in taking some profits today. These options are up 54 from when I posted yesterday call apps so taking just 20% of your position of what allows you to carry the remainder has a free trade if you choose. I am dictating this into my phone as I Drive so I apologize for anything so far spell check corrections that may be occurring.

      • CygnetNoir says:

        these options are up I’ll 5 bagger not 54 from yesterday

      • First of all, great call…

        Now, it makes sense to take your money out, since time decay will start getting bad…

        However, the Put 300 was $0.34, and now $.98… can you tell me what I am doing wrong?


      • Anyway CN, so buying OTM and selling it before decay hits, a nice 150% profit… My challenge is that is not being greedy and letting it go

        Nice call

      • CygnetNoir says:

        Pull up a chart of that option with col @ price … 25 cents was my Avg cost yesterday and several ops today to trade out at 125 cents or higher.

      • Makes sense, thanks!

      • 16golfer says:

        CN….when you buy OTM, do you use a % and if so, what do you use and what time frame?

      • CygnetNoir says:

        1) Will test of last swing high/low get me in the money?

        2) At the S/R, will my intrinsic value be greater than the premium paid?

        3) Days to expiration X Avg True Range of the trailing 14 days – will that get me in the money?

        Those are “rules of thumb,” and I will often bend them, but I wanted to buy as many cheap options (less than 50 cents) as I could at a strike above the 4/28 low of 299.50 (300 strike – 299.50 gives me 50 cents intrinsic), and a strike price within $51 dollars of the market at the time of purchase (3 days til expiration X $17 ATR). Again, these are more guides for me than rules, but in general I adhere to them rather closely.

        And I take some profits along the way – If this gets to be a 10 bagger, I will be out of 80% of my position. I don’t get greedy, and I don’t let myself regret not holding more of them longer if it keeps falling.

      • CN, I just realized what I said might’ve sounded odd to you, I was measuring by the time I saw your two posts… Buy to open on your first post (when I saw .34 ish) and sell to close on your post that you are closed (when I saw .97 ish)

        I was not questioning your trade.

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