wednesday update

SHORT TERM: another gap down opening, DOW +14

Overnight the Asian markets lost 0.8%. European markets opened lower and lost 0.7%. US index futures were lower overnight, and at 8:30 the Trade deficit showed some improvement: -$41.5bn v -$44.4bn. The market gapped down at the open to SPX 1913, dipped to 1911 in the first few minutes, then started to rally. The SPX had closed at 1920 yesterday. By 10am the SPX hit 1922, dipped to 1917 just past 10am, then rallied to 1928 by noon. A pullback to SPX 1918 followed by 2pm. Then a bounce to SPX 1923 by 3pm, and a dip to 1920 to end the day.

For the day the SPX/DOW were +0.05%, and the NDX/NAZ were mixed. Bonds gained 4 ticks, Crude lost 40 cents, Gold rallied $19, and the USD was lower. Medium term support remains at the 1901 and 1869 pivots, with resistance at the 1929 and 1956 pivots. Tomorrow: ECB meeting before the open, weekly Jobless claims at 8:30, then Consumer credit at 3pm.

The market gapped down at the open for the second day in a row today. The low, however, was made just minutes into the open at SPX 1911. Then the market had its best rally since the Minor C wave decline began at SPX 1943. We can now count 5 waves down for Minor C for a completed elongated flat Intermediate wave iv: 1926-1936-1914-1923-1911. 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. Today’s range SPX 1911 to 1928 appears to be the key to downtrend over, or continuing a bit more. Should the SPX rally above 1928 we will place an tentative Int. iv label at the 1911 low. Should the SPX drop below 1911 we will place a Minute b label at the 1928 high. With positive divergences just above everywhere we think traders will send the market higher.

Short term support is at SPX 1911 and the 1901 pivot, with resistance at the 1929 pivot and SPX 1943. Short term momentum remained around neutral all day. The short term OEW charts flip-flopped near the highs but ended the day negative with the reversal level now at SPX 1924. Best to your trading!

MEDIUM TERM: downtrend trying to bottom

LONG TERM: bull market


About tony caldaro

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218 Responses to wednesday update

  1. sloop says:

    ah ok we on the same tune EL Matador

  2. sloop says:

    lol sorry,1 of 5 at 1911

  3. sloop says:

    3of 5 being at 1911

  4. sloop says:

    I have w5 down as a ed,with w1,2 and maybe 3 done,so tomorrow will need 4 to overlap 3 and then finish 5

  5. Wedge still in play…wave 3 complete at 1905….wave 4 underway….I hope

  6. Done and dusted by the look of it. Can make a satisfactory count of the final decline. Very long now. Stops under the lows. The curly one was the market banging up against 16500 and 1930 for 2 days? Answer: 4 of 5. Hung around for a wile didn’t it. It’s still early on this move regardless of whether its Int V or just a B if your suffering from inaction. Need to get some more cigars.

  7. perversionofthemean says:

    RUT and SPX have about the same return now since the 5/15 low. RUT is leading right now.
    RUT is resting on the ’09, ’11, ’12, ’14 semi-log TL. Interesting that its recent decline failed to return to the May low, but instead has the look of climbing the TL.
    The triangle on SPHB broke to the downside, and this late-day rally is thus far just a snapback to test the break. Will work on a chart like jobjas, sometime! 😉

  8. Archer 1 says:

    Perhaps a poke through 1900 to clip stops needs to proceed before real relief? The uptrend channel I’m watching currently sits at 1893 FWIW.

  9. manunidhi21 says:

    how will SPX int iv align with NAZ major 4 to complete P3 in both.
    Atleast 4% correction is expected of major 4 in Naz?

  10. blackjak100 says:

    Well if b bottomed at 1905, it did so right at 138.2% ext of a almost to the penny! 1903 needs to hold IMO for various reasons.

  11. soulsurfer says:

    if I hadn’t looked at the price charts, I’d guess by the number of posts it’s a red day and doom and gloom is upon us.😉

    • wildmick says:

      youre a good chartist, surfer. I like reading your site.
      not even in correction territory and traders posting d&g.
      guess i’ll go back to drudgie invasion on the other site & fight like an Irishman.

    • pcskier says:

      You got to admit soul, thinks are trading a little different than normal maybe like 2011, or 2000 or 2007. You mention SPX below lower BB and Nymo in previous post as examples why the market is going to go higher. We have a long time for the next FED or ECB meeting, earning reports/catalyst are few going forward. China is getting tough with US companies(big earning growth potential coming to an end?). Buybacks have not been working for INTC lately(wonder how much they spent). Looks like emerging markets have put in their top, Europe is hoping for a lower high(to sell into) but may have a much lower low instead.

  12. Walter Crane says:

    Just want to repost what I posted…..ust 7, 2014 at 3:55 am

    The Dow topped officially on July 16th, final close. Sure the market went a little higher on the 17th but the 16th was the top price. 7/7 day. If this turns out to be true, I will tell you how I came to this conclusion. If not, just call it a crazy/wrong call. Still short and enjoying it. Loaded TVIX at the lows and holding for a stop of breakeven at 2.67 or a sell at 35 bucks. Its my big play, and I am playing it out. All this bullish talk just got me super bearish.

    The high is in for the next three years. How do I know, well will say, if this is indeed the case. I do expect a bounce soon to draw in some more bulls. But this bull market from 1981 is done imo…. Going to absurd low levels by December 12 2014…

  13. xela0 says:

    SPX, looks like a wedge on the hourly?

    • xela0 says:

      Well, went long, risk/reward is pretty good now. Maybe the smell of burning shorts tomorrow morning..🙂

  14. JeffMilano says:

    Tony, I have a question on the update yhat I recrived. P.175 area. Is this the correct place to ask or should I ask on a different site or by email?

  15. buddyglove says:

    Going down ….one way elevator to hell….imho

  16. uncle10 says:

    interesting magic hr ahead. seems weak.

  17. ariez5 says:

    Have been trying to catch the bottom, but the tape feels very heavy here. There are now serious two international crises brewing. I sense the bottom is about to give way.

  18. lunker1 says:

    Hi Tony,
    is Int IV still valid if 1908 is broken and down to what level?
    at what price will green label be removed for Int IV?

  19. bobhopium says:

    DOW fut 1-min…Just sayin.

  20. gtoptions says:

    Thanks Tony
    SPY ~ Fell into Gap Support Zone & reversed.
    Cheap Long w/stops. GL

  21. soulsurfer says:

    if we get an intra-day reversal that be bullish IMHO. +div screaming off the charts

    • wildmick says:

      think reversal has been working the last 40 minutes or so. waiting for the catapult which might show up on Monday with gapup and go.

  22. pcskier says:

    When I look at the uptrend from nov 2012. The first time $indu touched the 200 DMA it bounce, the second time it went below its 200DMA for a couple of closes, now I expect it to be progressive in time below it’s 200( I am aware it’s above now but I see lower highs and lower low to continue even if we may get a green close today~doubtful) Looking for spx to touch its 200DMA(for the first time since 2012) maybe around 1869ish before significant bounce. That being said if we get a 9/11 event, start of ww3 or EBOLA outside of Africa I believe we can get a 1987 outcome or $INDU down 4020 points quickly. When I look at TSLA today I don’t think we are even close to a fear capitulation.

    • perversionofthemean says:

      Other stocks have been dropping 10% in a day. TSLA, by holding up in the face of a general market decline, has exhibited my kind of relative strength. I don’t own it, and haven’t since it was about $42 (sadly), but I wish my other stocks had held up as well. They’re down about 3-4% on average.

      • pcskier says:

        If Tsla issued DEBT it would be rated junk(it is way speculative for valuation), just the fact that the momo are pushing it higher means to me fear is low or at least not close to capitulations for market bounce. Last week I mention GPRO and LOCO as examples of exuberance. When the momo are all chasing short the bounce will happen or at the 200 spx.

      • soulsurfer says:

        been in and out of TSLA often, now holding $232s… up 15% while the SPX down 5%…

  23. sky blue says:

    XLF & WLSH at support.
    DJI 200 day sma 6 pts below today’s low.
    SPX support 1905-1898
    NDX holding 50 day ema
    Naz double bottom
    UTIL double bottom

    The market is basically where it should hold. Maybe one more low. Maybe not.

  24. Ladies, gents, boys and girls, Please look at SPX chart from Mid January to 1st week Feb 2014.

    It fell that time, then remained at fallen level for 4 days and fell substantially after that, crashing 40 points in a single day after that FIRST fall. Tomorrow is the day, when that 40 point fall in SPX took place (assuming patttern holds and I have no doubt it will hold). Tomorrow market crash…

    Therefore, may I request all of you to BOOK regular LOSSES and report on this blog?? Please..please.. If anyone needs some help in calculating instantaneous loss, please ping me. Booking LOSSES is good for health. I have seen people who book losses regularly live longer than those who dont. LOLZ

  25. buddyglove says:

    Stick save for now, but the fat lady aint sung yet imho.

  26. If 1908 holds, will be amazing call by BJ & Mick.

    Does anyone here think the low is in?

  27. gary61b says:

    ES has some unfinished business at 1924.75 to complete

  28. Ryan Parker says:

    Has anyone noticed that 1,908 on the S&P 500 is an 83 point correction from 1,991? Same size as the April correction of 1,897-1,814.

  29. blackjak100 says:

    Typical expanded flat 3-3-5 in progress IMO targeting 1937 or 1.618*a. This would not complete B IMO.

  30. Many of you may be having a premature celebration, calling a victory at half time, we could still go down quite a bit.

  31. wildmick says:

    by golly & by jove, an excellent forecast by you tony caldaro sir! 1908.24 right at top of 1901 piv area. amazing. congratulations!

  32. cmucha68 says:

    So Tony, complete with iv and up from here ?

  33. H D says:

    “44-11=34, 28-07=21”, not saying it’s over but that was what I was looking for. wedge toward pivot,,,,1908, close enough. The difficult part is was it int iv or r we a degree off? GL it’s 5 oclock somewhere.

  34. uncle10 says:

    I broke down and had to go read a little about our RC fear greed index. Funny stuff.

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