monday update

SHORT TERM: gap up and go, DOW +112

Overnight the Asian markets gained 1.3%. Europe opened higher and gained 0.8%. US index futures were higher overnight, and the market gapped up at the open to SPX 1888. The SPX had closed at 1878 on Friday. The rally continued throughout the morning, led by the NDX/NAZ, into the afternoon. At 2pm the government reported another Budget surplus: +$106.9bn v +$112.9bn. Heading into the close the SPX hit its all time high at 1897 and closed there.

For the day the SPX/DOW were +0.80%, and the NDX/NAZ were +1.70%. Bonds lost 9 ticks, Crude added 70 cents, Gold rallied $8, and the USD was higher. Medium term support remains at the 1869 and 1841 pivots, with resistance at the 1901 and 1929 pivots. Tomorrow: Retail sales and Export/Import prices at 8:30, then Business inventories at 10am.

The market gapped up at the open to start the week. Then continued to rally, with only two-three point pullbacks along the way. Before 10:30 the SPX cleared short term resistance at 1889/1891, and then entered the OEW 1901 pivot range for the first time since early April. Around 3pm the SPX matched its all time high at 1897. This morning we marked the recent SPX 1860 low as Minute wave ii, when the SPX cleared 1891. With today’s, and late-Friday’s, strength in the NDX/NAZ, this rally could be the third wave, (Minute iii), we have been waiting for.

Short term support is now at SPX 1891/1889 and the 1861 pivot, with resistance at the 1901 and 1929 pivots. Short term momentum ended quite overbought. The short term OEW charts remain positive with the reversal level now SPX 1888. Best to your trading!

MEDIUM TERM: uptrending

LONG TERM: bull market


About tony caldaro

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114 Responses to monday update

  1. As said last week, SPX has gone past 1900. This sends “Snake Oil” theory packing as “Snake Oil” target (SPX 1902) is met. Now, is the time to send “Cave” theory packing.

    It is only Tomorrow/Thursday for SPX to try and rise above 1908, if it does not then my hedge fund will intial iSAF (intial Sale and Fold) to 200 dma (1780ish).

    Yesterday, I had first hand experience of Cave thoery!! I could not sleep!! SPX went up by about 18 points and I went into 0.02Cave with 0.98cave to go!! Many poisonous snakes, insects etc 0.02cave. Fortunately, my position was small.

    You have been asking about my analysis, if SPX goes to 1780, then 1840, then 1678, then will definitely put hedgefund theory on this board. If it does not follow that path means my hedge fund theory failed. But, for last one month, it has followed my hedge fund theory.

    • I am not saying this today becuase market has started falling, but I said this on Tuesday evening itself.

      I had thought it will hold till Thursday, but horror movie has started.

      Now, if you BULLS have guts, then SELL all your other assets (like house, car etc..) and BUY STOCKS.

      iSAF activated.

  2. llerias7 says:

    Seems that minute (iii) ended at 1902…minor 3 might end near 1912…pointing OEW 1929 for The Top of P3…just wondering…

  3. blackjak100 says:

    Looks like a little fourth wave correction going on and after that should finish 3 of c above 1902.

  4. Fireworks begin when Europe closes. Enjoy!

  5. John Arella says:

    Warning, DJIA near long term resistance again, will it break through or hit a brick wall again?

    • budfox9450 says:

      John, appreciate the call. But, there
      are already numerous warning flags.
      The “internal tops” have already been
      made, now waiting on the completion
      of the extermal tops….Bud

      • John Arella says:

        Bud what’s your take on the long term resistance, do you think it will hold or break through?

      • budfox9450 says:

        John, fair question. There are resistance
        levels one can find upi thru 1920 ish. My
        top is 1941, from a forecast perspective.

    • tommyboys says:

      Anything can happen but I only see two data points here while trying to make a third now. Will be interesting. If it DOES bust through it’ll get to 20k fast imho. Stay tuned gonna be exciting either way.

      • John Arella says:

        Two important resistance levels are 16,800 for one channel and 17,100 for the other channel, once we break these two levels than its party time🙂

  6. bobhopium says:

    Still bullish but reducing long exposure here….maybe of interest to some…
    Dow +209 points @ gearing x 335
    S&P +37 points @ gearing x317
    Dax +268 points @ gearing x1018
    Gl and good health to all.

  7. John Arella says:

    Warning , Expanding Triangle top of wave D possible at 1907-1909, then drop to 1770, don’t be caught with your pants down🙂

  8. gary61b says:

    1123 in the TF is good support.

  9. 16golfer says:

    Bobhopium….I see that your longs are leveraged, so you do have some doubt then and need to cover your bet?

  10. Tuesday May 13, 2014 will be 21 trading days Match number! , from April 11,2014 low on NYSE short term trading index closed at low reading of .76 on Monday trading session, noon reading was lower low reading .39 $Nyse Tick reading closed at negative reading of -224 $CPCE equity put call ratio made large change from reading of .72 to neutral reading of .53 on Monday. Comparing 21 trading day rise from previous wave structure from Feb 4, 2014 thru 3-6-2014 one can draw some interesting conclusions. Based on time relationships and volume. Overhead resistance going forward, monitor today’s, Breath ratios, next two trading days will be crucial to this wave structure count. I’m still long Starbucks Inc. Pre-market trading stock is higher!

    Good luck trading today!

  11. The rising NYSE Summation Index scenario is viable again. After a false start caused by the NYSE McClellan Oscillator falling below 0, the NYSI posted a nice point to point interval of +16.46 on Monday, May 12 resulting in an Index value of +827.45. A +1797 day on the NYSE A-D line moved the McOs from negative territory up to a +16.46 reading Monday. The R2K posted a strong +2.39% reading, providing hope that it may have begun an uptrend. The NYSE High-Low line recorded a daily +326, a number which could possibly double if we continue to have strong up days in close succession. The NASDAQ McOs rose to +12.86 on the strength of a NASDAQ A-D plurality of +1593. The NASDAQ Summation index is well below zero at -470.47, reflecting an extended period of negative McOS readings. The Summation Index is a cumulative graph of daily McClellan Oscillator values for a specified index.
    Both the A-D line and the High-Low line for the NYSE made new highs today and even the NASDAQ High-Low line is not very far below it’s all-time peak. But the A-D lines for the respective indexes must manifest continued strength for these promising trends to continue. I tend to believe that this time is the real deal, but time will tell.

  12. Greg Polites says:

    Jedimaster – what’s your take on your SPX:VIX chart reaching a new 10 year high? Cheer, Greg

    • budfox9450 says:

      I’am not Tony, but would not
      expect the pattern, to break above
      the 20,2 bollingerband. Off Topic
      is the OEW DSX shares, pattern
      there is most interesting, given the
      SP test of 1897….Bud

      • JK1987 says:

        Bud, BOYU indicator still a sell, or turned to buy?

      • budfox9450 says:

        JK- the past weekend the Weekly SP,
        BoYu moved to a Buy, wihich was confrimed
        Monday. Yes, the daily moved to a Buy signal
        as well. And, while that appear to be important,
        what you do not see is the massiive overhead
        resistance, the stems off a double low, 4/25 and
        5/6. Now, as for resistance, going up, you have
        4/2, 3/7 and 12/30. Later, being the strongest.
        One secret to the BoYu is that it has EW quilites.

        Example, my W4 low was 4/11. That marked the
        start of a W5 advance, which Tony correctly called.

        But – with no disrepect to Tony, intended. My longer
        SP view is that a Major B wave is being created. This
        comment flies ion direct conflict with many EW analyst
        views. But, aligns with the work of John Russo.
        So, while the Bull market may last longer than many
        think here, ala 2016, the coming Bear looks to be
        a 3 year event, or nearly so,…We are investing, in
        exciting times…..Bud

    • budfox9450 says:

      Greg – what is your take?

  13. kvilia says:

    – Not sure what’s more annoying – simpleaim or toothache. From the bottom of my heart.
    – Tony is right again. Thanks, Tony!

  14. blackjak100 says:

    Tony, I love the Cigar video! My wife and I love going to the horse races to wager much less $ than I do in the market since I live & work within 2 miles of the track. I have no edge in horse wagering and have no interest in becoming a handicapper.

    ED still looking ripe with the upper trendline at about 1920ish tomorrow! At 1911, c=.618*a and at 1938, c=a. I think there’s a high probability the ED ends between 1911-1938. Zigzags more times than not don’t exhibit a fib ratio so I don’t expect it to end right at 1911 or 1938. However, I’m not convinced the triangle ended at 1867 and may have ended slightly higher. I can’t count any impulse structure for wave i from 1867 looking at the 5 min chart. This would move the targets slightly higher. I’m leaning towards the higher target and an overshoot simply because it could throw off more people. Jeff Cooper, the great Gann guy, says 1930 ties to mid-may and 1921 is exactly 9 squares from the 666 low. All major tops are time & price squareouts. Do we get a 1930 intraday high (ED throwover?) and a 1921 close? Time will tell! Cheers!

    • rc1269 says:

      ‘wall of worry’ – the phrase alone makes me want to vomit. one of the most tired excuses for market moves. markets go up and markets go down, and there is always a flux of fear and greed. trying to quantify how much ‘fear’ there is in the market by stacking trite boxes of useless quotes is without value.
      at any given time we can construct a list of things that we *think* the market is either worried about or hopeful about, regardless of whether we’re at highs or lows.
      when you’re at all time highs and start throwing up ‘walls of worry’, you run the risk that one of those worries were warranted. Fisher made similar wall of worry claims in 2007 about the health of financials – we didn’t climb that wall, we fell off it.
      garbage in, garbage out. all just my opinion, of course.

      • tony caldaro says:

        garbage in, garbage out

      • budfox9450 says:

        The “wall of worry” phrase has been around, as long
        as Tony, or I. FYI, there is a technical pattern that the SP
        2007 high setup, from May -Oct 2007 – again 5 months,
        Now, step back to the internal high fo 12/31, and you add
        5 months, and hereto. One can arrive at a wall of worry.
        A wise investor, would recognize the risk, and adjust accordingly.


  15. simpleiam says:

    Faaaaaan – tas-tic! What a fun day! I’d much rather be long than short.
    Way to call’em, Tony! Hoping this is the start of 3, three, THREE!

  16. gtoptions says:

    Thanks Tony 🙂

  17. bhupal777 says:

    Tony, Kudos on your upside call. First time after so many months the entire session has showed so much strength. Very impressive rally today across the board. I read in twitter feed that DOW theory also confirmed today with trannies and DOW making new highs.

    Bears are licking their wounds.

    • LOL, bears their is no Bears. What their is , is a lotta fed money, no volume and a lotta soon to be bag holders. Don’t you guys think their is a reason that the market has to keep going up? it because if they don’t hold it up its going to collapse, they cant hold it up forever and most will be blindsided and in disbelief. Unreal people open your eyeballs, we have kicked the can down the road for too long. 17.5 trillion federal deficit, federal reserve 4 trillion, medicare and social security 200 trillion unfunded liabilities. This doesn’t end well people. We are hanging by a string. Best of luck.

  18. bobhopium says:

    Thanks Tony…Time for a cigar.

  19. Kevin M says:

    Celebrate what? The market maybe…. has MAX another 20-30 points to the upside and then the ED will kick in…..

    Don’t see any reason to celebrate……Those holding for higher than 1915-25ish are going to be greatly mistaken. Last gasp is happening.

    Again buy bonds…

    Take care…think and lead don’t trade and not think

    • jamesbondman says:

      I was joking. I thought you were out celebrating because you were very quiet today when the market was going up……:)

    • RDC says:

      Kevin: Your estimates keep going higher?

    • bobhopium says:

      Well “Kevin M” thanks for another one of your condescending posts. but hey… I did ma thinking and ma trding in mid April…Now I’m doing ma smokin’ ma fine-dining and ma drinkin’…Cheers.

      • Kevin M says:

        LOL you guys are great…….I said MAX 20-30 points higher. It’s very doubtful even for that to happen imho but hey bulls love the casino. Odds are still very high 1900 doesn’t hold past a intraday flare.

        All I’m saying is someone somewhere is going to start the avalanche. All it takes a big block to start the cascade. That’s also typical of a ED.

        Do you people like playing musical chairs???? Remember what happens when the music stops?


    • jamesbondman says:

      Kevin M…….is the M short for “Max 20-30 points higher”?…..or is it short for “Musical chairs”?……I’m a bit confused……:)

      • Kevin M says:

        Simple fib#’s here no TA. From the high in Mid Jan to the Low in Feb x it by 1.618 and you get 1919. That’s where it will stall and top out if it gets there at all. The 1.618 Fib is a very important extension level. Rarely do they extend beyond this. Plus the ED that Blackjack has been pointing out. He is 100% on this one

        Folks look….It can’t go up forever. It must reset. It’s a natural order.
        Think and trade not trade then think

      • lunker1 says:

        No offense to BlackJack but he’s been posting B wave scenarios for several hundred points now. Also wave 3’s often extend past 1.618. Time will tell.

    • lunker1 says:

      Kevin post some TA to support your call

      • simpleiam says:

        There you go! Thank you, lunker…

      • blackjak100 says:

        I’m not Kevin but the most simple explanation is there’s clearly a 3-3-3-3 structure for waves 2-5. 5th wave has a ‘b wave’ triangle so it can’t be a second wave. The first wave from 1646-1851 can be seen as either a 3 or 5.

        Simple, you stole my line! I wanted you to post TA, EW, and/or OEW to support your calls and I’m still waiting…..cheers!

      • simpleiam says:

        bj, my Options House charting program will not copy and paste to post charts on a blogsite, therefore, since I’m in agreement w/Tony on this particular move, I SIMPLY extrapolate using Tony’s charts.

  20. RDC says:

    Thanks Tony.

  21. pcskier says:

    Tomorrow morning may the last time to buy the all time high for a very long long time. Looking for the $vix to bounce to 20 starting its bounce in am ,euro weakness and yen strength. Also looking for $tnx to head down to make new yearly low by week end.

  22. bouraq says:

    So much risk for so little gain:

  23. jamesbondman says:

    I didn’t receive one reply to my email comment today about Dr Doom.
    Does that mean that people are actually listening to that guy ???
    Marc Faber has been consistently wrong with his comments since March 2009. That’s 5 years of talking rubbish and he still gets wheeled out. Still I suppose he can be relied upon as a contrarian indicator……:)

  24. thanks tony, seems like the market (finally) tipped it’s hand, though your count has been ahead of the curve for quiet some time! kudos!

    This is all starting to count real nice, even down to the micro level so let’s do some fun-with-fibs again to see if different degrees point to the same price target area:

    micro 5 = minute iii = 2.000x micro 1 + micro 2 = 2.000x (1889.07-1859.79) + 1867.02 = 1925.58
    minute iii = 1.618x minute i + minute ii = 1.618x (1891.33-1850.61) + 1859.79 = 1925.67
    this matches perfectly (with the 1929 OEW pivot).

    Let’s do 1 step at the time, but if one would like to do one wave degree higher then, if minute 5 extends 2.618x minute i -measured from minute ii- it is almost exactly equal to where minor 3 is 1.618x minor 1, measured from minor 2: 1966 vs 1967. (I am not sure if their’s an OEW pivot around here, but I thought there was!?).

  25. jamesbondman says:

    Hopefully everyone is out celebrating…….

  26. jamesbondman says:

    Thanks Tony and well done. Is it my imagination or are there less posts on an up day…….?

    • tony caldaro says:

      only 52 comments after the market opened today, typical for a Friday update

    • magicianme says:

      I took a short yesterday at circa 1891 with a two point stop. I got stopped out. I did not trade for the rest of the day as I was looking for a good entry (long or short) and the day was shaping up as a slow, tortured crawl up against a backdrop of heavy selling in the futures (based on average contract size at bid vs average size at ask).

      For several hours yesterday price moved hardly four points. Price at 1.15 PM was exactly where it was at about 10.15 AM having moved up about 1.5 points and moved down about 2.5 points. When the market is undecided a day trader is better off on the sidelines.

      Such slow action would affect the posting rate here. But you’re right – on up days there seem to be fewer posts on this blog. On down days there are a lot more, but they aren’t from “bears”, they are predominantly from injured bulls seeking reassurance that they’re on the right side of the trade, posting support for each other and coming up with all kinds of arguments to justify the direction they’ve committed to. So we get VIX and imaginary IHS patterns and astrology and blind faith in the Fed all being offered as good reasons for the market to turn.

      I’m on Tony’s blog because I respect his OEW counts but, unlike some, I don’t have such blind faith in the counts as to daytrade on them to the exclusion of everything else the market is telling me.

      • 16golfer says:

        Magic….Noticed the same thing about the perma bulls on down days. Needing someone to reassure them and hold their hands as they are sweating the possibility of their 401K’s getting trashed. Reminds me of the little “piggies” at the slaughter houses and placing blind faith in the FED.

      • bobhopium says:

        magician & 16 golfer.
        Yeah…I have to say I am bullish and am holding leveraged long positions, but I certainly dont feel “injured” “sweaty” or “slaughtered”…in fact I’m feeling pretty good 🙂

      • magicianme says:

        That’s great, bobhopium, I’m delighted for you. I suspect 16golfer was referring to those who DO sweat every small pullback and come here desperate for some reassurance.

        Unfortunately, there’s too much of one upmanship and childish my-side-is-winning outbursts, too much of big egos …and smug satisfaction when the market moves a bit in one direction (or the other). That’s a shame on what is otherwise a serious blog discussing markets and benefiting from the sharing of ideas, opinions and analysis. It’s also, IMO, disrespectful to Tony.

        The 1900s were expected in Jan. They didn’t materialise. They were expected in Feb and they didn’t materialise. They were expected in March and not only did they not appear but we had an early April pullback. They were then predicted to happen in April, but they didn’t. For over a month now the market has made zero progress – we’ve only just recovered to early April prices. Eventually the 1900s will arrive and when they do – whether today or next May – I’m sure there’ll be a few smug faces saying, “We told you so!” It would be a lot more useful all around if they posted their reasoning / charts / logic like some others here do (and many thanks to those posters).

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