monday update

SHORT TERM: gap up and go, DOW +176

Overnight the Asian markets gained 0.4%. Europe opened higher and gained 1.3%. US index futures were higher overnight, and the market gapped up at the open to SPX 1965. The market had closed at SPX 1955 on friday. At 10am the NAHB was reported higher: 55 v 53. The rally continued higher to SPX 1972 by 12:30. A small pullback followed to SPX 1969 by 3:30, then back to the highs to end the day.

For the day the SPX/DOW were +0.95%, and the NDX/NAZ were +0.90%. Bonds lost 10 ticks, Crude dropped $1.45, Gold slipped $5, and the USD was higher. Medium term support rises to the 1956 and 1929 pivots, with resistance at the 1973 and 2019 pivots. Tomorrow: the CPI, Housing starts and Building permits all at 8:30.

The market gapped up at the open, rallied to within one point of the OEW 1973 pivot, was quite overbought, and then began to pullback. The rally off friday’s SPX 1942 low has already traversed 30 points in just one day of trading. When the SPX passed 1964 this AM we marked that low Minute wave ii. Minute iii of Minor 3 should be underway. Normal pullbacks at this juncture should be limited to about 10 points. With the NAZ and NDX both in confirmed uptrends it appears it’s just a matter of time before the SPX and DOW confirm as well.

Short term support is at SPX 1964 and the 1956 pivot, with resistance at the 1973 pivot and SPX 1991. Short term momentum hit quite overbought at today’s high. The short term OEW charts remains positive with the reversal level now SPX 1964. Best to your trading!

MEDIUM TERM: uptrend highly probable

LONG TERM: bul l market


About tony caldaro

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126 Responses to monday update

  1. H D says:

    Trying to find anything unique about this wave, possible RSI study saying something. Waves have proportions in prices too. Wednesday: the FOMC minutes – enough said.

  2. I had my pants pulled down after getting it wrong last Friday. Was it a 3 or was it a 5 at Friday’s lows? Well it was actually a 5-3-5 or ABC on all indices. Easy in hindsight, and easy to see why TC is still doing what he does after all these years. The chief lesson here is if you get lost, try to get back on the right trail ASAP to minimize any damage. The answers are always in the charts (and on this website of course). There is little doubt anymore TC has the right count. Action in overseas indices is also helping to confirm. The best fit I can find at the present time is to suggest the SPX is trying very hard to conclude the whole of Minute 3 of Minor 3 as I type. Inside Minute 3 I have w5 = w1 x 1.60 for the DOW and w5 = w1 x 1.62 for the SPX. I also have Minute 3 measuring 330pts (DOW) and 36.5 pts (SPX). If Minute 3 is indeed cooked the Minute 4 target range I have for the DOW is 16820 to 16854. For the SPX 1969.5 to 1972 looks good. These are areas where prior 4s exist and therefore the first place to target. Bear in mind wave 2s have only been locatable during Minute 3 using a telescope borrowed from an observatory. Therefore the rule of alternation, although unlikely, can’t be ruled out completely making it possible Minute 4 will go beyond its traditional parameters. In any event Minute 5 of Minor 3 will follow and send the market to new highs for the move. See if I can keep my pants on this time.

  3. Anonymous says:

    no need to go long now S&P I rather miss 1-2 % move but I will sure go long when IV bottom out ( 10% + correction ) if EW any guide hell we all know that EW can’t account for everything hint hint NK can go crazy anytime lol

  4. gtoptions says:

    SPY ~ WR3 @ 198.81
    Doji Resistance 198.65
    For those that troll for non-EW related materials.😉

  5. FiveStars says:

    This market has already made up its mind for 2000+. Once it crosses above 2000 shorts will run as fast as they can which will push market much higher than 2000.

  6. 1986 Minor 3 of Inter III
    1984 wave ‘a’ of Inter III’s ED
    1985 truncated wave ‘e’ of Inter III’s ED
    1987-1985 Gap
    @ 1984 = 1.382*Minute 1 extension
    RSI 5 already hit 89

    how much more clustered can resistance get then this

  7. CygnetNoir says:

    Dull, dull market these past few hours ,,,

  8. lunker1 says:

    Hey Lee if youve got time to blow in SWFL gimme a shout and I’ll pole you around the flats sightfishing or grab a couple cold ones or both😉

  9. H D says:

    Oil use to mean something to the SPX, just saying. You want a list of my other excuses for a bad entry?

    • CygnetNoir says:

      HD, never mind the bad entry, just make sure you make for a good exit – the quality of your wins and losses is to be judge by your exits, primarily.

  10. drwarmington says:

    The 1973 pivot has a 7 point range on either side. The high so far today is 1980.73. Is That still in the range? Thanks anyone who has the answer.

      • I bought XIV (38.44) when the Vix hit 17 near the bottom of IV and I have just tightened up (44.32) the stop so it should sell today (I don’t want to be a Pig and get slaughtered). If and when we get another sudden change at the end of V and the VIX jumps to the 20 range I plan to buy XIV again and ride it back up as the VIX goes back down. Don’t buy the triple VIX Etf unless you are ready to put a tight stop on it and you have to be right. It is something you buy and trailstop it right from the get go.

  11. gary61b says:

    aapl broke the 700 mark

  12. Lee X says:

    Trading is hard for most people, but I’m great at it
    EWT is waste of time for most traders , except me I’ve done incredibly well..take my word for it
    Just use support and resistance, 666 support 1991 resistance…its so simple !
    I find ur method useless but still find time to post random thoughts all day here at ur blog🙂
    ahhhh the internet🙂
    Great job amigo !
    BTW rumor is that the good looking traders are firing up there AWSOME3000 super computers and getting ready to trade.

    • Lee X says:

      That’s “their” not there…doh !
      Hey guys let’s work on the grammar here , Google translate isnt that bad😉
      Big Thanks to L1. Soul , HD and GTO for keeping it real here

    • chrisk44342 says:

      Now that’s just plain funny. Well done. It’s amazing how many people take the time to post on here only to complain about EW.

    • CygnetNoir says:

      Trading is a waste of time (and money) for most traders, especially when they add in the time they spend trolling the internet🙂 Have I mentioned that 1991 is “money in the bank”? Why? Well, in this case the weekly chart tells the tale: Week ending 8/1 closed near the lows, followed by a lower low but higher and positive close the week ending 8/8 (the Big Up set-up), which triggered the week ending 8/15 with the higher high than the high of the prior set-up week, and was confirmed by the close in the upper 50% of the week’s range.

      What is really neat is to go back and look at the week before and the week after each of the following weeks: week ending 6/8/2012, 11/23/2012, 6/28/2013, 9/6/2013, 2/7/2014, 4/17/2014 (a tricky one because the trigger occurred the week after, but the confirmation was the second week after).

      What’s old is new, except for me … I just keep getting older😉

    • gtoptions says:

      LOL ~ Absolutely! EW is such a mess and this blog is so remarkably useless.Therefore I’ll continue to read and post on it daily.😉

    • You sound like that blow hard ass clown Ted of wave I go hide when I am wrong genus

      • Lee X says:

        Hey Tony

        Yes AWSOME3000 is my new super computer I had to replace AWSOME2999 as you can see. Had a great summer of travel and didn’t have one day over 90 degrees but now that its over here come the 90’s🙂

        Hey timing ! haha I think u might be right, hope u enjoyed the flannel weather while it lasted as ul be jumping in the Ohio river to cool off soon !

        Hey H D,
        Fishing was “ok” for the water being so high and cool as it was @ Lake of the Woods in Ontario and real slow in MI the last month. Can’t wait for to head to SW Florida in a month

        Hey L1,

        You da man ! Striper King😉

        Thanks chrisk , You gotta love it

        Hey Jerry,

        Take a breathe and use your words . I’m pretty sure you were trying to say something I just have no idea what it was. Thanks !

      • tony caldaro says:

        Day trading can be fun =)

      • uncle10 says:

        I was just thinking how so many people that I know and know of aren’t doing very well at all. And I’m not talking financially. Maybe its just me and my perspective but on balance seems like many are not happy….

      • lmfao… fellas are hilarious….providing good laughs in a crazy market….something to cheer the day with

  13. lunker1 says:

    since both retraces were .382 maybe both extensions will be the same too?

    1964 = 1.50 ext of 1905 -> 1945
    1983 = 1.50 ext of 1928 -> 1964
    1982 = .887 ATH -> 1905
    1982 = minute 3 = minor 1 = 40?
    1984 = IHS target

  14. Tony SPX has 60min bearish divergence now , you noticed this ? Could be end of wave 3 based on the negative divergence here.

  15. Tony

    What levels on SPX are you looking for as must hold if this uptrend should keep going ? Is is 1930 or 1940 which we need to hold above to confirm that this mkts going to rally still in wave 3 then wave and 5 up to top out?

    What levels are critical for you ? My guess is the 1929 pivot right ?

  16. gary61b says:

    ES is at overhead resistance from previous trend from low of 7/17 to 7/30 on 60min. could pullback from here.

  17. way to much complacency on low volume. IMO WE turn down today and hard soon.,

  18. market update within blog’s comments sect:

  19. uncle10 says:

    Tboys you out there? Just looked at SILC and bought some. Wondering what your thoughts are about it. Thanks.

  20. blackjak100 says:

    Nobody is talking about it, but beware of the int V ED. Hard to predict this early but with fed minutes & Jackson hole it could look something like this…

    Wave I = 1905-1985
    Wave II target = 1920-1932?
    Wave III target = 2019 pivot?

    How will we know if this playing out? Watch for break of 1964 for initial confirmation.

  21. Hi Tony

    Am I right to see that Italian mkts is now in a new bull market started in 2012 ?

    Thank you

  22. Hey cmucha don’t get frustrated with the market, just stop using EW cause it doesn’t work. It is very clever at hindsight predictions. Just trade between support and resistance. These fluffy 100-200 point targets are pie in the sky stuff that may or may not happen. The real money is in the consolidation phases. Notice how the ndx has only just now confirmed an uptrend, some 100 points after the low. Wow any idiot can tell you that, now the horse has bolted. Would you hop on now? Just another example of retro curve fitting. Those who are making money here aren’t using EW even though they are telling you they are. It’s designed to fool the masses. The low percentage calls seem to be working for now, but that’s the lure which will turn out to disappoint in the long run.

    • The problem is that Elliott wave is based on social economics and human emotions. Million dollar computer trading systems do not have emotions. I agree using Elliott wave blindly will get you in trouble. Just ask Robert Prechter However I use it very successfully in my own trading. The key is knowing how to use it.

    • cmucha68 says:

      Marketupsanddowns: thank you my friend. You speak the truth. I was making millions in a very short time and often (with options) just using my intuition and being patient but acting when necessary. But I also lost (thank god not too much) when becoming lazy and impatient and trying things like this one and following other peoples advice. The same thing broke the neck of Jesse Livermore. If you really have a good trading system why giving it for free. It’s your hard work. Except of course you want to attract people and selling your one on one seminar for a 1000 bucks. Millions of traders are using Fibonacci and Elliott but I haven’t heard of anyone who took great amounts of money out of the markets over and over again. This was my last post here. At least one who recognised the truth. That does not mean that I wish anyone bad luck here on the board. Every person trading on the markets deserves the right too succeed. I wish luck to everyone and especially to you marketupsanddowns !

  23. soulsurfer says:

    thanks tony, the technicals as I outlined yesterday surely suggested this move. Combine that with OEW, the highest probability count and boy is it hard to be on the wrong side of the trade.🙂 SPX 2014 next stop IMHO. This is how 3rd waves start: gap over all previous tops. No looking back. Here’s where the easy money is made.🙂

    Note that the 1.382x extension of PI, from PII at 2044, which is where per Tony’s count and in that case int. med. v = i.🙂 Perfect!? I suggested this target way back in February of this year already. Possibility of going to 2200s, but honestly me don’t thinks so for now…See here for a trip down memory lane:

    ps: no zweig breadth thrust event. Past Friday was the last day it could happen and even today it hasn’t gotten above the required level of 61.5%. Tell tale of a 5th wave!?

    GL y’all. I hope we’re all making buckets🙂

  24. Thanks also to all of the contributors here. Great people, greatly appreciated.

  25. Tony, great call. Nearly everyone seemed to be expecting a gap down this morning, but you stood firm as ever and replied that “you aren’t in that camp”. I’m not sure which is more amazing: your talent in deciphering the market, or your generosity in sharing it so freely and unfailingly. I think I’ll call it a tie. =) Thanks so much.

  26. XScaler HB says:

    Okay. Here’s what concerns me. I follow the top EW guys – Tony, Avi, Pretzel, and Danneric. All are on the same page. That concerns me because either a few of them are plagiarizing the others, or they are all seeing the exact same thing independently. I can’t imagine all would be counting that 1991 high as a B wave flat. That is very strange because it’s such a complex setup.

    The market is not an ATM machine and this rally – if it is indeed a 5th – is too easy. Just remember my ABC setup with 1970 as the A=C target. Either this is in fact a wave 5, or this is the top of wave 2. I just have a nagging feeling and I hate to be nagged.

    That said, if we do run to about 2050 which seems to be the consensus target, my trade will be easy. SPXU $45 Jan calls. Big.

    • I’m feeling the same way. I was tempted to go and buy a few hundred SPY 197 calls today as a triple seems pretty much guaranteed. One thing that I’m thinking is this. I’ve been in the markets for some 40 years now, and used to know a few things. But since the Fed got in the game, everything has changed. And as I peruse the waves, I ask myself this, what if the fact that wave 3 can’t be the shortest wave, doesn’t apply anymore. Would that change people’s wave counts? Just a thought . . . The Fed changed everything!

    • cmucha68 says:

      The ES January 16 call 2050 strike costs 19$ (Interactive Brokers TWS)

    • cmucha68 says:

      I must say jobjas and Bouraq have the best charts on this board (…and Tony of course). Absolutely clear and precise. No pico, nano and micro stuff. Support and resistance and targets. Most helpful yet. Clear guidelines. Thanks buddies !

      • torehund says:

        Cmucha, a clean sheet is always the best way to make up ones own opinion. However being on the board here you learn lots of stuff from others that can be beneficial to ones own Learning. The diversity of trading strategy, some longer term and some Shorter term, some in small caps and some run the indexes. Yes it may appear disturbing and then we find ourself in the midst of this apparen chaos…But long term its a good Learning environment, the best I have found around.. If one isnt confused, one isnt Learning anything.

      • cmucha68 says:

        Torehund:,I agree if you are new to the business in general you may learn a lot if you didn’t find your way. However, if someone is in the business already a couple of years and didn’t get it he will never get it. In the end it’s all about how much money you made. You can follow all displayed suggestions here (and a lot of them are really good ) but never making money due to your emotions or lack of proper risk management , over trading etc. 90% lose in this game. 1% is really cashing in. The rest survives somehow. Losing a bit, winning a bit and stays in the game, sometimes for 20 years but they never saw the big money.

      • cmucha68 says:

        And torhund: in theory most of the market participants showing themselves as heroes. Knowing everything in the past and telling you all kind of stories what will happen next. But ask them for their actual performance, whether they have put their money where their mouth is, silence.

      • torehund says:

        Chucha we as humans are also part of the Waves and terefore we swing too and loose objectivity. And sometimes there is another fractal we did miss and sometimes the Stock we own just had to test the ultimate bottom even after a 2500 reverse split. Errors here and errors there…however ill it may be, EW and techs tells us why we made it wrong. Its just as having the ills, knowing the diagnosis helps and then there is maybe a cure available. Those who understand nothing are worse of.
        But its always the ones that sit for an extended time between the Extremes that harvest the most. Thats maybe the most important lesson….

    • jobjas says:

      count updated

    • torehund says:

      Bouraq, why not “no end of war in sight” is Equal to prolonged tension, commodities are going on it. If it was just a brief Battle and then over and done With, nations didnt have to hoard anything. Prolonged tension and uncertainty in the midst of an economic upturn((at least USA and China), thats F:I:R:E. for parts of the markets that have declined seemingly forever. Hope I am not too bullish🙂

      • bouraq says:

        I was just referring to the news related market swings that happened last week and on Monday TH. I don’t markets care about Ukraine in the long run anyway.

  27. I’m wondering if anyone in here are good to calculate a possible wave 5 target ?

    Quite often you will see a wave 5 that is equal to wave 1, or 61.8% to 76.4% of wave 3. If there is a wave 5 extension, then wave 5 is commonly 161% of wave 3, or 161% of the sum of waves 1 and 3.

    Anyone has calculated some targets on a Int. V if we made Int IV at 1905 ?

    • I’m thinking around 2020 would be a good spot for Int IV to end, but wont be surprised if we rallied higher.

    • Assuming 1904 was the low which i think it probably was and based on what happened in 2011 where:

      major 4 bottom was 1249.05
      primary 1 top was 1370.58
      After major 4 the market rose 9.73% to complete P1

      major 3 top was 1343.01
      primary 1 top was 1370.58
      Primary 1 top was 2.05% higher than the major 3 high

      This would give us a target of between 2032 and 2090 for Primary 3

      From the major 4 low to the P1 high took 47 days

      That would take us to the 23rd Sept for P3 completion

    • chicotheman says:

      Like Tony says, monitor and adjust. For now I’ll go with 2050 5=1, give or take. SPX just bounced off and broke through key levels in spectacular fashion. I doubt we’re halfway there yet from 1904. There’s still plenty of skepticism. Maybe minute 3 is subdividing and will run all the way to new high. Or something.

  28. Anonymous says:

    from risk reward prospective why would anyone initiate long position now? if you pick P4 bottom and ride wave 5 to me it make sense your thoughts?

    • budfox9450 says:

      Actually, I invest with the Primary
      Signals, Using VTI for P1, P3, and P5.
      Downside is SH, for P2 and 4. So,
      it makes a lot of sense…..Bud

    • ariez5 says:

      1. Because the risk of staying out too long is that one gets frustrated and throws money in even higher up.
      2. Because in minute 3 of minor 3, chances are that we are not quite at a top.
      3. Because Tony’s brilliance notwithstanding, the market can pull positive surprises.
      Hope this helps.

  29. torehund says:

    Kudos for nailing it Tony.

  30. mjtplayer says:

    Thank you Tony, sure has the look and feel of a “3 of 3” from Friday’s low. This int v is unfolding quickly, could see minor 3 end this week or early next with the final minor & int v high around the holiday weekend for yet another “holiday high”.

  31. ariez5 says:

    Thanks, Tony.

  32. chicotheman says:

    Any thoughts on minor 4? Minor 2 was relatively mild.

  33. chicotheman says:

    Thank you Tony and contributors, great roadmap lunker.

    If today’s gap at the 3rd of the 3rd is near the midpoint for the move, then we are looking for about the 2019 pivot.

  34. lunker1 says:

    Thx Tony.
    Roadmap EOD

    Minute 3 from 1941.5 looks like it has nested 1,2’s as well.

    w1 1941.5 /1951.21 is > w3 1946.32/1955.03
    and w5 is 1951.65/1972+
    but w3 can’t be smallest so:

    Micro 1 1951.21 (10 pts)
    Micro 2 1946.32

    Nano 1 1955.03 (9 pts)
    Nano 2 1951.65
    Nano 3 1966.52
    Nano 4 1964.94

    Micro 3:
    Nano 5 = 1 = 1965 + 9 = 1974 (hit 1972 today)

    Micro 4:
    Prior 4th at 1965
    Basis 1974: 23.6% = 1969, 38.2% = 1965

    Minute 3:
    (basis 1965)
    Micro 5 = 1 = 1975
    Micro 5 = 1.62×1 = 1981
    Minute 3 = 1 = 1942 + 36 = 1978

    Minute 4:
    Prior 4th at 1965?
    can’t have 4 into 1 at 1964

    Minor 3:
    (basis 1965)
    Minute 5 = 1 = 2001
    Minute 5 = 1.62 x 1 = 2023

    Minor 4:
    Retrace 23% to 38% of Minor 3

    Minor 5:
    5 = 1 = 40pts
    5 = 1.62 x 1 = 65 pts

    P3 Min: 2013
    P3 Max: 2066

  35. Thanks for the amazing work which you share with all who are interested.

  36. JK1987 says:

    Tony Thanks
    With iii of 3 of V proceeding, should Int iv turned from green to purple?

  37. JeffMilano says:

    Great work Tony! TX!

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