thursday update

SHORT TERM: morning rally fades, DOW +32

Overnight the Asian markets gained 0.5%. European markets opened higher and gained 1.0%. US index futures were mixed overnight, and at 8:30 weekly Jobless claims were reported lower: 319k v 344k. The market opened one point below yesterday’s SPX 1878 close, dipped to 1875, and then started to rally. At 9:30 FED chair Yellen gave her second day of testimony, and FED governor Tarullo’s speech was released: The market continued to rally until noon when it hit SPX 1889. Then it began to pullback. At 2pm the FED released: Just past 3pm the SPX hit 1870. Then bounced to SPX 1877 just before a 1876 close.

For the day the SPX/DOW were mixed, and the NDX/NAZ were -0.30%. Bonds gained 5 tick, Crude slid 50 cents, Gold was flat, and the USD was higher. Medium term support remains at the 1869 and 1841 pivots, with resistance at the 1901 and 1929 pivots. Tomorrow: Wholesale inventories at 10am.

This market continues to display a start-stop pattern ever since the early April low at SPX 1814. However, unlike the early-February to early-April choppy/corrective activity, this market still looks constructive. Since that low we have had a the following action: 1885-1851-1891-1860-1889-1870. Until SPX 1860 is revisited again we have to consider this activity as a nesting of first and second waves of a lesser and lesser degree. Today the pullback, for a change, was led by the SPX and not the NDX. The NDX actually was looking constructive for the first time in a while. But this has happened before over the past few months. The next few days should tip us off as to what to expect in the coming weeks.

Short term support remains at the 1869 and 1841 pivots, with resistance at SPX 1889/1891 and the 1901 pivot. Short term momentum declined from quite overbought this morning. The short term OEW charts are still flip-flopping, ending the day negative, with the reversal level now at SPX 1878. Best to your trading!

MEDIUM TERM: uptrend probable

LONG TERM: bull market


About tony caldaro

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126 Responses to thursday update

  1. buddyglove says:

    Bots have just remembered that its opex next week.

  2. In case you winder why the DOW is butting it’s head against the 16,600 level over the past weeks, it may be because the 1.0x extension of P-I, measured from P-II is at 16810. Close enough (1.2% difference)?!

  3. llerias7 says:

    The media is trying to sell a correction…meaning stocks should rebound next two weeks in a final leg up to 1940´s in a 3% move!

  4. pbnj123 says:

    Just breaking the silence here and just a fun observation but May (so far) looks like a miniature fractal of April 🙂

  5. gtoptions says:

    Thanks Tony
    Two weeks of FED/WPP oscillations. Quite Incredible to say the least.
    I’ll try not to post anymore politically disruptive comments. Yikes! 😉
    Hope everyone profits from their personally biased positions.
    Enjoy the Weekend All.

    • tony caldaro says:

      thank you
      no politics or religion is a good idea
      just like the markets, no ne ever agrees

      • 16golfer says:

        I agree with that Tony, but when people call you an idiot or a hater, that becomes more than a differing opinion. Some just cannot accept another’s differing view and are juvenile by using such terms. In my experience, it is a defensive posture for a low self image.

      • tony caldaro says:

        Childish even.
        However, everyone has to keep in mind commenting on a blog is like going to a Halloween party. No one knows who posters really are. So they can say and do whatever. It is only when someone takes a comment to heart that it becomes a problem. Alter egos usually emerge in a virtual world.

    • if one just sticks to writing posts that are technical one easily circumvents all these personal issues. I know nobody is perfect, we all make mistakes (i.e. we all sometimes write personal posts, and some more than others) but the name of the game (in life) is to make as few mistakes as we possible can. Since prevention is better than a cure, writing technical factual posts is the best way to go, IMHO. Tony constantly reminds us of that.

  6. Pixelworks Inc. Closed position at $5.58 today,for nice profit, after company reported its earnings. Most of the indexes, have eight new higher closes, on daily time frame. Which is Match! Time cycle analysis May 12 is the next turn date, will be it be high or low? Weekly time frame, there are some interesting Fib ratios, on new higher closes, which suggest given high $CPCE equity put call ratio, indexes have some upside in the coming weeks ahead. Anyways, I’m on the sidelines now. 100% Cash position. Might go long next week, sometime around the hourly cycle.

    Tonys analysis, still is spot on in my opinion.

    Have positive weekend, old Chinese proverb, Try not. Do. Or do not. There is no try.

    • Kevin M says:

      Amos…..Amos….Amos….The CPCE can and will get much higher. BTW quit posting your trades. Nobody believes you and/or cares.

      • Kevin M says:

        I stand firm…..Buddyglove is an idiot for saying I should fa_t feathers and wanting to me to fail.

        You too are an idiot if you can’t see this issue.

        it’s simple, treat somebody the way you would want to be treated. If not, than accept the consequences.

      • trondack says:

        Kevin are you using Elliott Wave? So you think we are going into iv now, and final v later this year. Do you think 1740 in Feb could have been iv and this is the final blow off to > 2200? Fed is monetizing until Sept. What will the dealers do with that money?

      • Kevin M says:

        Trondack-All great questions. Yes EW is used but it’s very subjective so I have other tools to rely on also. To me, the fact that the overall market could not make all-time highs longer than intra-day is very telling. The market never gives you this much time to get on board. 4 was Feb and 5 has just ended. The Bigger III also has ended. 2200 will not happen until end year/next year. V will be the blow-off/panic get it moment. Odds are high 20k dow will happen with 2300+ on the SPX and NAZ back to all-time highs. Seasonality is very important here. Thats why I say 5 and III has ended. Midterm years are very tough years that typically mark a buyable bottom for the ramp up into pre-election year. Thinking we just go up now and breaking out is delusional. It would have happen already. Nobody can explain why it hasn’t.

        By July 4th people will see all of this.

        Now…..I can’t claim to be 100% perfect, so if I’m wrong then 5/III are still ahead and blow-off 5/III is in the late summer. A falll crash should happen thereafter. However this would be very unusual. When the printing stops in September if I’m correct then the overalll market should do a re-test of the summer lows and then blast-off into 2015.


    • simpleiam says:

      Amos, please don’t pay any attention to Kevin M. I like your posts and you’re a gentleman, so no worries, okay? Your blogs are filled with great info., so you go right ahead and type it up. Whether or not you want to post your buy/sell positions is up to you, but know that you’ll likely catch some flack if you do so. GL Amos!


  7. uncle10 says:

    Thanks Tony.
    No change from a week ago. Staying short. A close above 1885 has me flat or long.
    Gl and good weekend all.

  8. magicianme says:

    As ZH would say, BTFD.

    Sorry to all those holding longs, there’s just no steam in the engine today. And there’s no immediately apparent news catalyst for later in the day to help either.

    The signs of complacency seem to be screaming out around here. For example, I hear comments about it being 1% from the ATH. That’s not a reliable metric of anything. The rise all the way from 0 isn’t relevant. We don’t do a Fibonacci retracement all the way from zero, do we?! Look at price action over the last week, or month, or since the last swing low. Don’t look for what you want to see, look at what the market is telling you.

    From price over the last week, we are way below 50% of the high. From a YTD perspective we’re about 20% away from ATH…. if such percentages even mean anything. What’s more relevant, IMHO, is price action, volume, momentum, correlated instruments etc., as they are playing out right now. And when looking at other indices you’d be surprised at how often major global indices lead the action …. it’s not always RUT or NAS or SPY. A recently very strong FTSE has changed tack and is leading the way today.

    Good luck all, one short trade at the open and I’m done trading for the day.

  9. oneandonlyuniverse says:

    oneandonlyuniverse says:
    March 7, 2014 at 8:46 am
    Finally a 10-12% correction being served up…1654…..iwm 104
    thetruthtrader1 says:
    March 7, 2014 at 9:11 am
    I am with you brother

    This was my last post. Truth, the need to post everyday is absurd. The next move is a no brainer!! Why? Because, when you argue with reality , you lose, but only 100% of the time.
    Spx has to go to the 1779 pivot , if it doesn’t that will be a first ( ever ) . Yes, my 1654 call was terrible. The Iwm call is great . Be prepared $rut has another 3% down and SPX will get the 1779
    pivot. good luck to all

    • I understand I will not post as often and limit my view to once a week. I enjoy the blog except for a few. But bull bear debate is part of the game.

      • oneandonlyuniverse says:

        “But bull bear debate is part of the game”. Not at all, It is only about MAKING MONEY. The vix post are trash . Be a pro- POST LESS AND MAKE MORE.

      • I will refrain from Posting about the VIX. I was a fixed income and then futures trader in my past. I respect and wont post often. I will assume being in my late 60’s that I am older than you. I have made a ton of money to realize that at my age and in my condition that money was a lousy way to keep score and the credentials on my wall do not make one a good person. Good luck everybody

      • Truth, good post. Money is great but in the end it comes down to family, friends and living with who you are.

  10. Lee X says:

    Please guys If you can not muster any respect for other posters here , I’m talking calling each others idiots ect.. can u at least muster some respect for Tony ?
    Please stop embarrassing your(virtual)selves.

    Thanks !!!

      • Lee X says:

        haha touche !

      • Last post, I hope…

        Lee, there was a wink there, but didn’t make it to the blog. My other comments were not directed at you, or anyone else, just an observation. My best years were, when I worked for people on your side… My party is God’s love.

        Golfer, I don’t think GOD will approve of your hate, no matter what the media tells you, did you know that both Dems and GOP’s media is owned by the same group of people…that is enlightening by itself.

        Lots of love to you all, especially Lee and Golfer.

      • Lee X says:

        I enjoy the banter and I like getting challenged and I respect that .
        I smile when I post and I smile when u send one over my bow.
        I think if this was a video/face time type of blog we’d get along tremendously

      • Hey Lee, me too, I enjoy it as well, and I do respect and look for your posts everyday. In a parallel universe we could be BFFs. about the same age and all… I’d be lucky if I can keep up with you, which is impossible.

        Have a great weekend.

    • 16golfer says:

      Good point Lee. However, a leopard doesn’t change it’s spots so nothing will change. I’m just a goyim so I expect the attacks.

      • 16golfer says:

        Surfingwavers….there you go again. Saying I’m a hater when you don’t even know me. What is it they say? When someone says another person is such and such, the person making the statement is guilty of that accusation. Is it possible you are a hater Surfing?

      • Golfer, one needs to know hate and love both in order to pick one and become it… the trick is to void yourself of hate and fill it with love, no matter how impossible that person is to you.

        Seems like you don’t pay attention in Tony’s teachings, you’re missing out of some great lessons…

        I am out, and I am sorry for too many posts… Have a great weekend Tony!
        And Golfer, and lots of love to all.

      • 16golfer says:

        Surfingwavers. You can save the condescending advice for someone else that shares your views. I embrace forgiveness every day in my life….it’s just that some people make it almost impossible to do so because of their hateful responses. We all have feet of clay.

      • Golfer, I see you are getting upset, I am not holier than the pope, and not trying to preach to anyone… God knows I am as guilty as the next person, I am just trying to not let things bother me, and ended up making you upset.

        Please embrace forgiveness and find it in your heart to forgive me, for whatever I said that bothered you… you can trash me all you want and I won’t respond, that will be a good practice for me.

        I’ll even fetch your balls…

    • Kevin M says:

      Hey lee here is a quote from Buddyglove to me “Its not about the $…Its because KeVin M will have to eat so much crow, he will be Far*ing feathers. Do you think that’s an adult thing to say here on this forum? Also does it pertain to trading?

      I have an obligation to address such misrepresentation on my character. So please save it ok and stay out of it.

      • Lee X says:


        Grow a pair , Hey but I love ya I really do

        Have a great weekend Tony enjoy the mowing

      • Kevin M says:

        Grow a pair? My pair is already all grown up good sir…….

        Stick with the subject ok…Trading subject only Please

      • simpleiam says:

        Hey, Kevin M! You’ve got nerve; Ms. Primrose, Ms. Delicate Sensibilities! You come in here swinging, then get bent out of shape by such a wuss statement as ‘farting feathers’? Are you kidding?!! Who do you think you are? If you can’t take the heat, Mr. Fart Master, get out of the kitchen!!! I think buddyglove was going easy on you; there are those who will swing right back. And your blog aimed at Amos is ridiculous; he’s posted nothing but market related info. What a WIMP you are… wa, Wa, WAAAAA! The-World’s-Coming-To-An-End CRYBABY!

  11. Tony
    India Nifty rallied over 3% today.. Can you please ellaborate on a bear market which keeps making new highs? Last government election results in 2009 it rallied over 20%…
    Current election results on 16th may.

  12. jeffbalin says:

    Naz under 4021 will set up a rsi nice pos div on 60 min then maybe lead market up?

  13. jeffbalin says:

    Tony, you marked ‘downtrend’ on the Spx 60 min chart. Mistake?

    • tony caldaro says:

      no, it has been there since April

      • 16golfer says:

        Pitching & Putting is probably the most important part of the game. “Drive for show….Put for Dough”. Jack Nicklaus says biggest % of time, the game is played from within 60 yards of the green.

      • tony caldaro says:

        Was never into games where I had hit the ball and then had to go get it 😉

    • jparkins10 says:

      I started playing, more seriously, when I was living in India….50c for a round for someone to find my ball wherever it went…..the best way to start 🙂

  14. Let me apologize for my sarcasm on this board and let me help because small time players talking about next leg highers and using Gan supports on 30 min charts because that how the players on wall st made their money LOL. . For those who have not noticed growth is slowing and inflation is rising regardless of what Janet Yellen says. Next shoe to drop is fed credibility. But goosing the market has been the Feds game. I am bearish because I see and comprehend what’s going on. I have played the game of liars poker. The actual game. Look it up if you have never heard of it. The money is holding up the S&P as a hedge. When hedge comes off your coming down. It’s ok to have an opinion or a count or comments. But you don’t cross the line on personal

    • It is very easy, and any child can also see that this bull will have a major correction someday, in the next year or so…. you are not saying anything spectacular here….

      The point is to call it as it happens. On the moment that the big outside BB happens, can you say if it keeps going or a big reversal just happened… People are playing heads-up poker, and you (and newbie) are telling us a flush can beat a straight… so it is kind of funny, to some.

      • Bull case is Fed and market S&P does not go down

      • Yep, I don’t think it will be funny if your holding long and 1987 happens again.

      • Just like now, this unusual activity, can you see it?

        The question is, are we going to have a busy 90 minutes and then calm down rest of the day (like most Fridays), or is it going to be a non-stop sell-off, or a major turn and burn?

        How fast can you see it? and how accurate are you going to be?

  15. simpleiam says:

    Happy Hunting Everyone! The pre-market is simply flat…

  16. buddyglove says:

    I really hope we do rally hard from here.
    Its not about the $…Its because KeVin M will have to eat so much crow, he will be Far*ing feathers.

    • simpleiam says:

      I truly wish everyone would ignore the Festrov Brothers who blog here, but guess some like the argument. Have a great day! Simplify!

    • RDC says:

      No problem. Yes it will rally hard into Options Exp. week and SPX will cross 1900 easy.

    • Kevin M says:

      Buddy…..I gotta say you’re an idiot! You want the market to go against somebody, just to hurt that person. You are a sick person.

      Regardless, the market will go down despite your perma-bull attitude

      • Kevin, I must say, we are a Bears in a Bull Pen, I mean honestly the complacency and high market expectations by some of these bloggers is ridiculous. Many have been conditioned this way by the fed but holy smoley, take your profits and go on vacation. Come back after a couple hundred point spx drop and reevaluate.

      • Kevin M says:

        100% agree newbie! Amazing to say the least….

  17. blackjak100 says:

    The triangle looks good but the e wave may have not completed at 1870 and will complete today towards 1865ish. Trade above 1889 confirms the triangle and trade below 1860 invalidates the triangle. It will not shock me if we get neither today.


    • pbnj123 says:

      Looks like you are on the right track 1865 on deck
      Thank you for this update on what you are watching

  18. tommyboys says:

    For the techies – attached is a 30 min SP chart highlighting multiple IHS and a triple top ascending triangle all holding Gann support. Support & resistance closing in.

  19. tommyboys says:

    Bull markets have volatility and that’s all this is. This is all completely normal bull market activity. Only thing that has changed is the bears have waken up pointing to seasonals, all encompassing valuations, election cycles, risk off with RUT leading etc…Haven’t we all noticed the difference on this board? Haven’t the uber bears come out of the woodwork? Isn’t sentiment in the tank? Do all these things occur at market tops in time to get everyone to safety? All this and the majors are only a couple percent from ATHs. This is all exactly what is called for to fuel the next big leg higher. Fiona posted a great “fat pitch” last night analyzing leading markets – great read.

    • buddyglove says:

      I totally agree, but just because us bulls have the contrarian view does not automatically make us correct……..just sayin.

    • simpleiam says:

      I agree, tboys. I don’t consider some of bloggers you call uber bears to be bears at all. Apocalyptic raving is not market information befitting a true Bear, it’s idiocy.


  20. The traditionally strong month of april did not manage to pull the market out of the consolidation trading range.
    Then why should the weak may-june period have Power enough to do the trick?

    • magicianme says:

      Because there’s no logic when a market is POMO “rigged”. The market can proceed to go up in defiance of gravity, to fly against the laws of economics and to display a complete disregard for common sense. As the saying goes, the market can stay irrational for longer than you can stay solvent.

      That said, the signs don’t look good. Daily RSI (whether 14 period or 5) is showing lower and lower highs despite price staying stagnant. Cyclical resistance has been forming on several time frames in an indicator I’ve come to trust. My price bar analysis (thanks for all your great books, Al Brooks) suggests price heading down. Volume analysis (thanks to pioneers in the field like Wycoff, Tom Williams etc) suggests price heading down. There are numerous other signs. But the market could stay irrational.

      I wonder if any of the bulls on this board – the ones who are expecting the end of third wave and the subsequent ED reversal – are taking their shorts now with the intent of holding on through that (possible) shoot for a new high. Or whether they’re waiting for that high before going short and therefore risking not being in the market (or being on the wrong side of the market) when the big move hits.

      I endorse Cliff Uzan sentiments below. Tony, kudos to you for your professionalism and sincere best wishes for your continued success.

  21. Cliff Uzan says:

    Hi Tony,
    No matter what happens, your attitude and discipline are quite amazing. You demonstrate excellent leadership and expertise in your field. After an absolutely exhausting up down market in the past few weeks and you are still bullish I find that truly remarkable. As I mentioned before many individual stocks are way down and this tells me more than anything else that we are in a fifth wave, if we haven’t already topped. Like bhupal777 mentioned, it really is amazing to see the SPX still so strong. Continued success with your blog.and your trading.


  22. 777daimon says:

    I think that on Friday, May 2nd, we saw a high. Eversince that date, on SPX, we saw lower highs , lower lows.
    Yesterday’s action (Thursday) was a major bull fail. Nobody pointed that, so I’m doing it now. To exit from the 1869 pivotal area and after that to be kicked down right in the 1869 piv.area = bull failure.
    I’d be more careful with waiting end of “e” at 1910 +/- a few points and I’ll be more careful about waiting a phantomatic 3 of 3 that never appears… a “waiting for Godot” kind of thing. Just look on daily chart starting from 1st January 2014 and look where are we now… is this bullish? Be careful with the longs, the situation is serious. Buying the OS and selling the OB? Ok, but be careful cause big falls appear from OS levels…. just saying… one day this week, or next week the bulls buying from OS levels will have a major, major, major surprise. And not to the upside.

    • 777daimon says:

      although, I can’t ignore Blackjak’s theory.
      This guy might be right and SPX soon will fly above 1900+ with pink clouds and unicorns around.
      But I still have my doubts… but I will adapt if this thing happens.

      • blackjak100 says:

        It will fly above 1900+, but it will complete the ED and it will be a short lived affair (false breakout). We need to break out of this triangle and it’s possible the e wave is not complete as it looks pretty brief. It’s possible it completes towards 1865ish today and we get a gap and go Mon. Trade below 1860 voids the triangle completely!


  23. gtoptions says:

    Thanks Tony
    OS buy ~ OB Sell ~ Repeat!
    Hey Lee, I think the Teachers Union should propose a special tax on donuts. That way DNKN can be the Hero, and I won’t feel so guilty making trades while eating a chocolate kreme donut. Maybe I’ll go into Hilton this evening and have a drink with the lobbyist and fix this thing right up. I’ll entice with a box of fresh donuts. LOL 😉

    • Lee X says:

      Hey gto.

      That’s a good idea but I think Karen Lewis would complain about being doubled taxed on her income if that came to pass 😛

      • 16golfer says:

        Talk about the elephant in the room? lol. Might have more disposable income if less food was purchased and consumed.

      • gtoptions says:

        Think she has respiratory issues? LOL

      • It’s amazing how certain people become members of certain political party… by watching people talk and measuring the level of compassion in one’s behavior you can call their political affiliation with a very high accuracy.

        Lots of love to you all, good or bad.

      • Lee X says:

        Oh zip it Captain outrage the only known political affiliation is yours

    • 16golfer says:

      Probably all that extra fat around the lungs hindering her ability to breathe. Imagine the health costs that all those healthy youngsters will have to pay for in way of insurance premiums!

      • 16golfer says:

        Thanks Lee. Surfingwavers doesn’t like my political or religious views, so I’m on his “evil” list. Thank GOD we live in America and can have differing views. Too bad those that have differing views can’t act like an adult and accept another’s viewpoint without being critical or hateful.

      • LMAO, It’s amazing to read this reply to that comment… take your time and read my post again later, and then read your reply again, and wonder where the hate is coming from

  24. bhupal777 says:

    Thanks Tony.
    Both Dr. Doom and Dr. Doom (Mark Faber and Roubini) are back with their bubble talk. Last time they both were pounding on the table in summer of 2011 and the downtrend was almost at its ending stages and we know what happened after that. A massive rally in last 3 years. I am not expecting a massive rally now but I am also not expecting a crash like they are predicting. As you laid out in all your updates, we probably will start 3’rd of 3’rd any day from now on and market will just slowly (really boring fashion) grind higher for P3 top to form.

    But for bears there are plenty of stocks to short. Lot of weakness in individual stocks. I am really amazed to see how SPX is holding so strong. May be index ETF allocations keeping it afloat?
    I am already preparing for P4 by buying SEPT and JAN PUT options on some of the weak stocks those have already made a print below 30 week SMA and making lower lows.

  25. simpleiam says:

    Thanks Tony! Was another Something-For-Everyone day. Good trading day.

  26. budfox9450 says:

    You may wish to ask yourself…. What would you be doing
    with say, 100 shares of SSO you bought 10/4/11 at 33.80.
    Well, what would you do? Buy more, Sell, or wait. Primary 3,
    trend investors have been already doing what they feel is best.
    And, you would?

    • I wouldn’t be a greedy pig and I’d take the profit and RUN!!!!!! oh yeah and get ready to pay the tax man.

      Ok, now its only fair you share you huge losers as well.

      • budfox9450 says:

        Only fair ? Your hypothetical reply,
        what you would do. I would sell, of course.
        But – the purpose of the excercise. Was to
        give thought, to the huge profits, longer term
        investors, have aquired. This then
        accounts possibly for the pattern we have
        been seeing since 12/31/13…imho.

      • 16golfer says:

        Doesn’t it seem unfair? If you have a loss, all you can deduct is $3000 per year. If you have a $100,000 gain, you pay on the whole amount. Gotta love the tax man.

    • greenmountaintrader says:

      Cheers Bud from T country….The Laundry CI says, unless it reverses, SSO to lower weekly BB currently @ 95 before we see 120. And the Feb lows better hold.


      • budfox9450 says:

        Help me a bit. T country, as in T Theory?
        That Laundry CI ? Been a long time since
        since I was in the “forum group”…But,
        I have an $80 call for the SSO – at some
        future date, 2014-2015….Leaning toward a
        very long time being spent in P4 down…

        • greenmountaintrader says:

          The CI agrees with you. Granted it could still reverse, but Terry’s M cycle low is due in 2016 so you could be right on your price targets and an ugly P4. I still think we could correct and go onto new highs before we head to the 2016 Low but I remain flexible, and short.

      • budfox9450 says:

        Oh – the Laundry CI, now my memory flickers
        to ” on”…I have found the FAGIX fund, is a pretty
        good market timer, when I apply, the BoYu indicator.
        Signals currently are Bearish. Keep in touch….Bud

      • budfox9450 says:

        last question – is “she” still running the group?
        Or is it completely desolved now?

        • greenmountaintrader says:

          Will stay in touch, Bud I still have your email. There are a small group of diehards still working to further the theories at the site. We have no leader, we have become open source, as it were, within the forum.

        • greenmountaintrader says:

          Short term FAGIX looks constructive,no? Implied upside target of 10.17 will SPY follow?

    • Sure would be monstrously bullish to break out of these huge uptrends (on INDU & SPX) with negative divergences on charts, but … always keep an open mind. Not sure what the catalyst would be, as market today didn’t react bullishly about positive economic news with first-time jobless claims dropping to 319,000 — below consensus view of 330,000 and below the low entire range of estimates. Also, Retail Metrics reported U.S. retailers posted a 6% same-store uptick in April, the biggest increase in 2-1/2 years. Good luck all!

      • jeffbalin says:

        Do you know how they calculate that retail number? I’m in retail small business and I don’t understand exactly what they mean when they report a 6% uptick biggest in 2.5 years. It has to mean only select big box because small business retail is hurting, everyone I know is surprisingly down from last year, so far in 2014. The retail corporate chains I know , same thing… especially in April. Now these are mostly mall and shopping center retail….clothing, gifts, hair salons etc. Has to be an increase in just the basics from Big Box like WalMart only. Couldn’t include chains like Best Buy, they’ve been struggling. Retail up? No way. It’s down. The ‘bad economy’ continues for a lot of small retail and I think we are the better gauge for true consumer confidence and spending. When we are in high gear the overall economy is looking really good. Maybe that starts in cycle 3. The stock market 5 year run up seems artificial to me but I’ll take it. But cycle 2 is should be pretty good!

      • Hi, Jeff, I do not know how they calculate the number. BTW — I am short — not long. I posted a few days or more ago that I went short. I got this retail info. from IBD (Investors’s Business Daily). They also posted the following, which was quite interesting, as they are a very respectable/bullish group. Quote below:
        “One factor that may be working against the current market is history. As IBD reported in early January, this year faces tough historical hurdles . After a down year followed by two strong up years, a fourth straight up year is rare.
        Since 1900, only seven similar cases existed and only one (1951) delivered a gain.
        “History would seem to suggest that asking for an up year in 2014 is asking for a lot,” IBD reported on Jan. 6.
        What has happened since then that would change that perspective? Nothing.”

    • Oops! Didn’t mean to post this under your chart, Bouraq — meant to post at top level. My apologies.

  27. bhtrade says:

    Now that the big $$ longs have rotated out of high betas into mega caps it should allow high betas to begin showing some relative strength. Problem is, not sure how much more the mega caps can run as they have barely corrected. Like long RUT, NDX against short DJI,SPX spread but no interest in outright length near these all time highs, will let all the “experts” play for that last 1% before a way past due correction kicks in.

  28. radrian6 says:

    The morning saw the RUT following through from yesterday’s bounce but the bulls couldn’t hold onto any of it as the bears closed the session with an 11-point loss. Today’s close was the lowest since February 5 and RUT has now strung together three closes below its 200-day SMA. Further downside is implied in the current pattern — RUT may need to stab at 1083 before traders cover their short positions. If RUT is going to form the right shoulder of an H&S top, it needs to start soon. Keep in mind that May options expiration is next Friday so some price flattening or a bounce is likely.

    Daily RSI(5) reads about 17.4 on my chart but is not showing any positive divergence. Weekly RSI(5) has made a double stab into oversold territory — a rare event in this bull market which testifies to the seriousness of the ongoing correction. As I mentioned yesterday, even if RUT begins a rally from here, it will likely be a grind — there is plenty of resistance overhead beginning with 1115-1127.

  29. makiori says:

    boring as it may seems but I still think the best gauge for the direction of the major US indexes is $/yen. any significant diversion from 102 is the best clue for the direction of the of SPX/DOW.
    without recapturing 102 on a closing basis, it will be difficult for the indexes to post significant and lasting gains.

  30. attitude928 says:

    Thanks Tony. I really enjoy your blog. Looks like the $RUT (TNA) has a green reversal tomorrow.

  31. “we have to consider this activity as a nesting of first and second waves of a lesser and lesser degree.” I like that consideration. 🙂 Especially when the nesting is over and the 3rd of a 3rd wave is on it’s way.

    ps: GMCR and SCTY did both obviously well. TSLA not. Two 12+%-ers, one -8%, so overall not a bad day.


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