monday update

SHORT TERM: market rebounds, DOW +76

Overnight the Asian markets gained 0.3%. Europe opened higher but lost 0.1%. US index futures were higher overnight and the market opened at SPX 1929. The SPX had closed at 1925 on Friday. By 10am the SPX reached 1931, then began to pullback. The pullback lasted until 11am when the SPX hit 1921. After the low the market rallied, with only a three point pullback, to SPX 1943 by 3:30. Then pulled back to end the day at SPX 1939.

For the day the SPX/DOW were +0.60%, and the NDX/NAZ were +0.75%. Bonds gained 5 ticks, Crude added 60 cents, Gold dipped $4, and the USD was lower. Medium term support rises to the 1929 and 1901 pivots, with resistance at the 1956 and 1973 pivots. Tomorrow: Factory orders and ISM services both at 10am.

The market opened higher today, pulled back, and then took off to the upside with its best rally since the decline from SPX 1985 began. From the SPX 1985 orthodox high we counted a double zigzag: 1970-1979-1962-1976-1925-1937-1916. We then estimated that SPX 1916 may have been the downtrend low since there was a confluence of various technicals at exactly that level. Since that Friday low the market has rallied: 1932-1921-1943. This could be a 1-2-3, or an a-b-c B wave. Until the market enters the 1956 pivot range (1949-1963) a B wave is possible. If a B wave, then a retest of lows, or slightly lower, is likely next. If the beginning of a new uptrend, Int. v, the market should enter the 1956 pivot range. We should know the answer in the next couple of days.

Short term support is at the 1929 pivot and SPX 1916, with resistance at the 1956 and 1973 pivots. Short term momentum hit overbought today during the rally. The short term OEW charts turned positive at SPX 1932, with the reversal level now SPX 1933. Best to your trading!

MEDIUM TERM: downtrend may have bottomed

LONG TERM: bull market


About tony caldaro

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145 Responses to monday update

  1. hkloon says:

    Hi Tony, with regards to this comment “This decline could also have been a Minute a of Minor C, today’s rally to SPX 1928 Minute b, and Minute c next to complete a zigzag.” The decline you mention here is from 1943 to 1911 – minute a of Minor C right? then 1928 is minute b. If minute c does happen, then minute c should be lower than 1911 right?

  2. I think the bottom’s not quite in sight yet. Some wave relationships … wave 1 of 3 was 58 DOW points, wave 3 of 3 was 171 pts making it 3 times the size of 1 of 3. In side 3 of 3, wave 1 was 66 pts, wave 3 was 116 pts and wave 5 was 69 pts. So inside 3 of 3, waves 1 and 5 were approximately equal and wave 3 about 1.7 times the size of the other two. I think these relationships give weight to the low of the day being only 3 of 3 (of 5 of C). Therefore the move off the lows that the market’s finishing the day off on I favor to be 4 of 3 (of 5 of C).

  3. xela0 says:

    Correct also in OEW that the D-Wave in the Dow cant go below the end of B-Wave?
    If so, sell-off seems about done?

  4. buddyglove says:

    Yes, I think we all see the pos/div, but I cant take my eyes off the dirty great bear flags that have formed on all indices……….Just sayin.

  5. timing101 says:

    Positive divergence for $SPX and $INDU on the 60 min. and daily.
    $RUT has made higher highs and higher lows the last two days.
    I’m long, wish me luck!

    • kvilia says:

      Ditto. $RUT has been a leading indicator to me perhaps because small caps are more attractive to traders and short term investors, so you see money flow earlier. Still no position as I’m waiting for Pri IV to short. Quite afraid to get long now but Tony is saying 2070 😉

  6. nenehubb says:

    Tony, do we now have +D in both the DOW and SPX 60min and the daily? Thank you very much!

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