monday update

SHORT TERM: gap up and pullback, DOW +16

Overnight FED vice chair Fischer gave a speech: Asian markets gained 1.5%. Europe opened higher and gained 1.4%. US index futures were higher overnight, and the market gapped up at the open to SPX 1938. The SPX had closed at 1932 on Friday. The rally continued until 11:30 when the SPX hit 1945. Then a pullback to SPX 1936 followed by 2pm. After that the market traded in a 4 point range, and ended the day at SPX 1937.

For the day the SPX/DOW were +0.20%, and the NDX/NAZ were +0.65%. Bonds lost 2 ticks, Crude gained 25 cents, Gold slipped $3, and the USD was higher. Medium term support remains at the 1929 and 1901 pivots, with resistance at the 1956 and 1973 pivots. Tomorrow: the Budget deficit at 2pm.

The market gapped up at the open and continued to rally until it cleared the B wave high at SPX 1943. Then after hitting SPX 1945, forty points higher than Thursday’s low, it started to pullback. Clearing SPX 1943 suggests the Int. v uptrend is underway. Pullbacks during the early stages of an uptrend are usually limited to 9 to 12 pts. Thus far the pullback is 9 points. Should the market continue to pullback and get oversold we could mark this high as Minor wave 1. If the pullback is small it is probably only Minute wave i of Minor 1. Either way we expect the market to move higher once this pullback ends.

Short term support is at the 1929 and 1901 pivots, with resistance now at SPX 1945 and the 1956 pivot. Short term momentum hit extremely overbought this morning then declined. The short term OEW charts remain positive from SPX 1917 with the reversal level now 1933. Best to your trading!

MEDIUM TERM: uptrend probably underway

LONG TERM: bull market


About tony caldaro

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82 Responses to monday update

  1. H D says:

    cupnhandle, INHS, W2, 1929 pivot, what u got bears?

  2. Nothing unusual here today. Looks like a 4 and smells like a 4. Looks cooked as well. Dropping below 1927 would cause a major re-assessment and bring TC’s complete Minor 1 into favoritism.

  3. uncle10 says:

    Thanks Tony.
    No lack of movement that is for sure
    Our world needs something. I faith it will come.

  4. lunker1 says:

    there’s a fork line that’s creating the lower highs from 1945. bulls at some point would need to see a breakout and poss backtest. maybe a better way to enter long since this slide could keep sliding until this resistance line is broken.

  5. H D says:

    Gm Tony, all. another ruby Tuesday? DOW looks terrible, huge hit made for a weird pattern and less than .382 on the bounce to 628…. Guess it’s up the the 1929 pivot to save the pattern, otherwise 1945 gets an X wave.

  6. cmucha68 says:

    If 1929 pivot holds during the session I guess we could close at or near the highs.

  7. lunker1 says:

    Hi Tony, Int IV is still green but Minor 1 isn’t. Could you please clarify? TY

  8. JeffMilano says:

    Tx Tony. I see that you have started posting int 5 with minute 1. Can minute 3 subdivide? And since ghis is a 5th wsve can it truncate. Tx again

  9. torehund says:

    If the Norwegian inflation figures is the Canari in the coalmine, and rapid inflation is to be spreading around the world, then we may just have the most explosive stockmarket rally just right ahead of us.

  10. lunker1 says:

    10 from 10

    • lunker1 says:

      No +D on 15 or 60 min yet

      • JK1987 says:

        Tony Thanks for the Minor 1 of Int v label.
        Exactly 1929 pivot, 38.2%, RSI oversold.;

        There was no -D on 60m at 1945 either.
        No need to have +D or -D?
        1956 pivot is next? As bj mentioned yesterday.

      • wildmick says:

        think minor 2 would have to run its course or at least minute 3 of minor 2 finish b4 getting +D?

      • lunker1 says:

        yes Tony posted Minor 1 label but did not yet put a tentative green Minor 2 label at 1929.

        not sure why but you repeated your comment from 11AM “1929 pivot, 38.2%, RSI oversold.” I guess posting it twice means something.

        Minor 2 could retrace down to 50% or 62% or more. the 60 minute didn’t reach oversold at 1929 so maybe this is only B of Minor 2 with C down to follow to then get to oversold.

        pos or neg D is not a requirement but it’s nice to have. yesterday there was -D on the 15min RSI5.

      • JK1987 says:

        lunker, 38.2% and oversold RSI do worth attention, imho.
        Look at the secondary wave retrace off Feb and Apr low, they both are very shallow. 38.2%?
        Last Friday you posted a very good analogy of the running up pivots. 1956 pivot next? Is it the case?

      • lunker1 says:

        today 1929 60min RSI5 in my book wasn’t oversold hit 34 vs below 30. yes 10 down from 10am, 1929 and .382 are interesting. I’m already long but not interesting in adding more here. Int IV is still green. if 1929 had a nice +D on 15min I might have added a little. yes price can bang around between the pivots but this wave isn’t behaving like the prior two impulses I wrote about. Int II Minor 2 retraced 50%. the 1929 pivot goes down to 1922 which is midway between the 50%/61.8%. not seeing the .382 in Feb and April you’re talking about.

      • lunker1 says:

        if still in Int IV, see that it’s looking more like Major 4.
        LL for Int A
        HH for Int B
        then waterfall drop for Int C

        so maybe
        1905 Minor A
        1945 Minor B
        and waterfall for C where 1991 Int IV CD=AB Major 4 = 1878. that number to keeps popping up.

  11. perversionofthemean says:

    SPY gap up from 8/8 to 8/11 filled minutes ago. A magnet I thought would be filled yesterday. However, IWM’s gap has not been.
    The rally off the lows Friday appears like an ABC to me. If it’s really 1-2-3, how far can 3 be retraced without blowing the impulsive action? Just to the top of 1, right?

  12. JK1987 says:

    1929 pivot, 38.2%, RSI oversold, cheap long.

  13. cmucha68 says:

    Went long now with SPX calls at 1929 pivot. Let’s see how it works.

  14. XScaler HB says:

    OK. Setting a buy stop for the SPX third week expiration for 20 $1850 calls at $50. I just can’t help but think that we have another lower low coming.

  15. lunker1 says:

    45-33=12 👍

  16. Well, as some on the board said it before, price triumph time. And so I have to admit so far my timing prediction is off but my wave count is still in play. Currently the ES wave count is as follows;
    Micro a (1931 ES) of Minute 4 complete
    Micro b (1938) of Minute 4 complete
    Micro c of minute 4 underway and heading towards the 1923 ES pivot (1929 SPX)

    • cmucha68 says:

      Hello Fiona: You are always posting a lot of interesting things but without commenting on it. Do you believe in that kind of prognosis like the last one or is it just a general info for all of us ? Have a good trading day !

  17. XScaler HB says:

    I’m with BJ on this. This chart says it all. I don’t even try to out-think Tony, but I just can’t look at this chart and not see a classic 5 wave move down. If this chart is accurate, then we do have a new low coming first. But with today’s bull flag setup, the top of this suspected B wave would go no higher than 1967. Keep those trailing stops.$SPX&p=60&yr=0&mn=2&dy=0&id=p40177602585&a=358423856

  18. Bullish Confirmation Today on Starbucks SBUX, I am long at $76.67 targeting $79.00 for swing trade. URRE symbol, onbalance volume, Time Segmented Volume indicator, are compelling to keep this $2.73 stock on radar screen.

  19. Damn can’t believe Robin Williams is gone. He always seemed bipolar. I think he tried to treat it by drinking. What a shame. Comic genius.

    • jeffbalin says:

      I can never understand why the big stars don’t have the best people around them, so they can avoid these types of situations.
      An incredible creative genius mind, quicker then lightning, can deliver hours of hilarious non stop comedy just off the top of his head. Will never be anyone like him again.

  20. esvxm says:

    Thank you Tony for the analysis.
    S&P 500, Dow Jones and $NYA all rise from key patterns:

  21. I tend to agree with BJ (although he is on a different higher degree count) and El Matador who posted earlier in the session in that the indices look as though they finished the cash market session carving out a 4. The next question is which 4 is it? Is it Minute 4 of Minor 1 or is it 4 of Minute 3 of Minor 1. To differentiate I would suggest that if we see the SPX drop to the 1930 area in either the 24 hour market or tomorrow’s cash market before it rises to new highs for the move then the SPX is currently most likely in Minute 4. On the other hand, if the SPX rises to new highs for the move without approaching the 1930 area then I believe we have a good chance that it’s only 4 of Minute 3. Thanks TC. Take care everybody and see you tomorrow.

  22. Could last week’s bottom just be an A wave down in 4? Now we get a B wave up and C down to complete 4. Why is that not more likely than last week’s low completing wave 4?

    • valunvstr says:

      That’s the camp I’m in. It is VERY unusual for an index to close below the middle of the weekly Bollinger band for two straight weeks and not tag the lower end, now at around 107.77 in iwm. No way iwm goes to 107’s with broad market not going with it lower. It would be very unusually so look for this week to be a down close for iwm and a move toward the bottoms of the bollinger band in the next couple/few weeks.

    • jeffbalin says:

      All I know is I don’t really like that the naz/compq did not get too oversold on the RSI 5 on the daily or the weekly, and the major 4 correction for the naz is like 3.8%, which seems pretty low. It is possible however, that the market doesn’t care what I think. I am, going to keep a close watch, this could be a B wave, major 4 on the naz and int 4 in Spx may still be on.

  23. blackjak100 says:

    Thx tony! By your update, it seems like you possibly count 5 waves 1905-1945? I still only see 3 with iv in progress.

  24. torehund says:

    Thanks Tony !
    Today the CPI monthly came out here in Norway at 0,7 percent, With an astounding monthly 3,1 percent increase in the price of Food. The ministry of agriculture had previously agreed With distributors a rise of one tenth of this, and they cant figure out what has happened.
    This is the beginning of hyperinflationand in Norway and no-one except Americans can avoid it as long as dollar is the reserve currency. As softs and the USD is still at ultralow Levels its obvious that this is a ticking time bomb.

    • That is shocking. That would mean a 37.2% annual rate of increase for food and an 8.4% annual rate for the CPI.

      • torehund says:

        George, its so astounding that one lading Economists today proclaimed they dont even believe the numbers are real. Its a nation in denial, and this has been going on for a long time. Even when the data precent themselves as lucid as this, no one says the Word hyperinflation. As I have been watching the chart NOK/USD it has been pretty obvious to me that either the market devalues the currency or the Central bank intervenes. The currency is between a rock and a hard Place, there is no Escape.

    • hrmny358 says:

      NOK had it’s best rally in a while. Rates on hold? Is the economy slipping or stable?
      Lots of stops triggered today

      • torehund says:

        hrmny, as crazy as the Logic is, the insane numbers are ascribed to lesser risk of interest rate decline going foreward, market doesnt take into account that the NOK doesnt buy you a lot anymore. And yes, I think it suerly is a head fake, and that stops got triggered.

    • JeffMilano says:

      In Italy there is the Euro / Very stable, but the nation is on its knees since very limited resources and austeraty is the norm. Other ountries can print money but inflation will be there to deal with. So I am not sure what is better Norway or Italy. Supermarkets here do not sell bread beacuse peple started making it at home. Italy is in a depression. France is not doing well. The only country that is florishing is Germany. This year tourisim in Italy has not done well.

      • torehund says:

        Jeff I agree, and I hope that Italy has reached or passed the bottom.

        A bubble that never popps into a healthy deflation sooner or later turns into hyperinflation.

        Its amazing how the politicians and the Public alike, seemingly in an inadvertent manner is forever drawn into making the wrong decisions, as if we are all predestined to follow the cycles from one Extreme to the other. Maybe Einstein was right, that free will is nothing but an illusion.

    • ewmarkets says:

      There is high inflation in US too but somehow the CPI does not show it. We women, who buy groceries for the family, know better.

      • Ryan Parker says:

        Frankly, it seems to me that I can’t leave my house without spending $100+ anywhere. I have gone to the grocery store to get just a few items and by the time I stop for gas and duck into Home Depot for a few necessities a meaningless trip out has already lightened my pocket by $100+. Anyone that doesn’t see it is blind or doesn’t do any shopping whatsoever. I just paid $14 for a pound of roast beef earlier today. Its incredible and it is the higher end product but I could get the same stuff for maybe $7.99/lb maybe 3-4 years ago. $5.99 about 10 years ago.

      • 16golfer says:

        They can’t show it in the CPI or the SS benefits to the millions of baby boomers would sky rocket.

      • Ryan Parker says:

        You got it golfer. That is why the CPI is constantly being revamped to show under-state inflation as much as possible.

      • tony caldaro says:

        The FED does not even use the CPI.
        They watch the PCE.

      • tony caldaro says:

        According to the FED’s own numbers
        PCE per capita has been running between 2.5% and 4.5% since 2010.

    • tony caldaro says:

      maybe the limitations on food imports in Russia will help

      • torehund says:

        I think this is the underlying economic psycology: The fear created by the public expecting a housing bubble to burst “at any time” actually prolongs it by discouraging Builders,resulting in further shortage. Alongside there is an ever increasing governmental bureaucracy that needs to feed themselves through increasing taxes which drives up the costs of the milkman. The taxes are so devastatingly high that Our own breeded salmon can be bought for much less in Russia and Spain. This also applies to gasoline, cheese, milk and the Mc Donald hamburger 🙂

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