tuesday update

SHORT TERM: rally continues, DOW +81

Overnight the Asian markets gained 0.5%. Europe opened higher and gained 0.7%. US index futures were higher overnight as well. At 8:30 the CPI (+0.1% v +0.3%, Housing starts (1093k v 893k) and Building permits (1052k v 963k) were all reported higher. The market opened three points above yesterday’s SPX 1972 close and continued to rally. Nearing 3:30 the SPX hit 1983, then dipped to close at 1982.

For the day the SPX/DOW were +0.50%, and the NDX/NAZ were +0.45%. Bonds lost 4 ticks, Crude dropped 75 cents, Gold slipped $3, and the USD was higher. Medium term support rises to the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Tomorrow: FOMC minutes at 2pm.

On Friday the market closed just under the 1956 pivot, then gapped over it on Monday. On Monday the market closed just under the 1973 pivot, then opened above it on Tuesday. This is typical market activity, during this bull market, when dealing with overhead resistance pivots. The next important level is not a pivot, but the all time high SPX 1991. Thus far from the SPX 1905 low we have had three rallies: 1905-1945, 1928-1964, and 1942-1983. We have been labeling this advance as Minor 1-2, and Minute i-ii-iii. Notice all three rallies have been about the same size, between 36 and 41 points. Even the two pullbacks (1945-1928 and 1964-1942) have been similar. With this symmetry and an extreme overbought short term reading today a pullback may be next.

Short term support is at the 1973 and 1956 pivots, with resistance at SPX 1991 and the 2019 pivot. Short term momentum hit extremely overbought today. The short term OEW charts remain positive with the reversal level now SPX 1975. Best to your trading!

MEDIUM TERM: confirmation highly probable

LONG TERM: bull market

CHARTS: http://stockcharts.com/public/1269446/tenpp

About tony caldaro

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131 Responses to tuesday update

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  2. hucky2 says:

    So where if the w4 pullback?
    New high first or after the pullabck?

  3. Tony,
    OEW question. If the SPX makes a new high by just 1 point would it still qualify or do the other indices have to join? Thanks.

  4. Great poker video, Tony. Unbelievable.

    Market certainly has the feel that it is 2000-bound.

  5. FWIW, if we haven’t exited Minute 3 yet, then at 16994 in the cash market I would have the DOW at 1.618 its version of Minute 1.

  6. pooch77 says:

    INDU’s trying to catch up to QQQ’s before the last leg up

  7. manunidhi21 says:

    Isn’t thr a -ve div on SPX 60 min chart ?

  8. FiveStars says:

    There is absolutely NO reason for market to go down and it has every reason to go above yes well above 2000. So shorting and hoping market will go down, the answer is Absolutely NOT.

  9. Rioting in the streets of Monrovia over the Ebola epidemic…market goes up. I really REALLY hope there isn’t a confirmed case in the wild in the USA or UK, or wherever the coming weeks. Anyone else get the feeling people aren’t taking this matter seriously enough?

    • torehund says:

      Twosided thats why it spreads, and mass media is forwarding this delusion. Say “no fear” and patients are transported in closed oxygen tents…I Guess its all in the Waves, pests and tumults, arabic spring is escalating. Thats evolution and evolution would have gone nowhere without change, wordl doesnt care about its passengeres in times like these. Bottom line its a Product of overpopulation relative to diminishing resources, and then add top heavy corruption in good times preceeding the clash..

  10. pooch77 says:

    Got my 1973 last night as I posted yesterday,we should now hit 2000 by Friday…a mere 20 points from here….beware next week bulls

  11. rc1269 says:

    all bond mkt heard was ‘rate hikes maybe sooner than later’

  12. gary61b says:

    Maybe a 20+ point drop for minute iv. similar to ii ?

  13. manunidhi21 says:

    Tony !

    listen to last line..”I called it the life-preservers-on-the-Titanic theory. When the Titanic was going down, people would pay a fortune for anything that floats. … I’m exaggerating, of course, but that might be the situation we’re in now.”

  14. H D says:

    Pandora has an excellent classic rock channel

  15. cicelyalaska says:

    Took my 65 S&P points and sold all. Will wait for something else to set up, short or long. Murphy’s Law states it should run another 100 points now.

  16. manunidhi21 says:

    Namaste Tony!
    still IV not in purple ?
    now it looks possible for P4 to bottom around October 23rd if P3 is near 🙂
    all the world will be shoring at the decision in October and OEW will be buying

  17. uncle10 says:

    How r we going to get our 10 today? long or short?

  18. torehund says:


    You just buy it here, and hope for a grand 3 later.

  19. If Mr M remains elevated going into FOMC, then I expect it to turning into an FOMC sell the news event

  20. perversionofthemean says:

    Tony, is it normal for minute ii to be larger than minor ii? Also, with alternation, how much of a pullback (if not already done) would you expect for minute iv? Thank you!

  21. Hi Tony,
    I’m looking for a pullback in IWM to the 112 area to form a symmetrical inverse head and shoulders. I suspect the pullback is beginning today but it’s not certain. A close above 115.73 would negate the pattern.


  22. torehund says:

    When you think Wall Street has used up all the tricks in the book they lay nails in the road….

  23. perversionofthemean says:

    Aloha Tony! Is there an OEW rule that says 3rd waves must sub-divide?
    Also, if the minimum requirement of this 5th is to make a new high, then should we expect the Dow, SPX, and NDX, but not necessarily the RUT?
    Last, how will we know if this 5th is “extends”, so I can let my profits run?
    Thank you!

  24. infantguru says:

    I know a lot of the folks arent looking beyond 2000 for spx, but if the 4 forms a successful handle to the cup formation then the upside is between 2070 and 2080.
    However, a top has a topping process, so the “cup and handle” strength of the fifth can be taken with a grain of salt at this point.

  25. Just went outside to get the mail. Did I miss minute iv?

  26. mkt. update and strategy for today (within blog’s comments sect.):

  27. Scott Ford says:

    Tony, any thoughts on AAPL? It seems the Major B wave should be ending shortly, in line with the NDX Major 5/S&P Primary III? I would expect it to then retrace back down to Major A levels?

  28. pcskier says:

    My bear case for lower highs and lower low was based on rsp equal wt sp 500, it’s there now. Interested in how the day will unfold. I just arrived back in the USA from Santiago. Highly reccomend visiting if you have not.

  29. lunker1 says:

    Q’s hit my double bottom target today (from Feb/Apr lows) so I took a closer look. I see 5 up from April low and if 5 = 1 = 98.83 which was nearly hit today

    so two intermediate targets and hit in one day? more than coincidental.

    so looking at the NAZ.
    5 = 1 = 4550.
    today hi 4529
    pretty close.

    other clues:
    August low I see 5 up on Q’s and NAZ.
    SPX hit .887 retrace of 1991 to 1905 today (a favored algo reversal point)

    so, some caution here.

    • chrisk44342 says:

      I agree Lunker but the only caveat for NAZ is that on the daily chart, it looks like 1-2-3 completed with a possible? 4 beginning today from aug 7 low. This doesn’t mimic tony’s subdividing 3 on SPX but it’s close enough

    • perversionofthemean says:

      Lunker, given that NDX has led SPX since May 8, I’m wondering why you might think that NDX isn’t going to subdivide minor 3 as Tony suspects SPX will? Not arguing; just too knew to know.
      Of course, after any odd number of waves up, it’s time for a wave down, so I could see the Q’s pull back again. They’ve exceeded my measured move already, and while my retirement account is still long them, I’ve botched my NQ trades and it’s flat.

      • lunker1 says:

        didn’t say it wouldn’t. just saying now’s a good time for indexes to pull back and if the pull back comes to then see how much it does and go from there.

      • perversionofthemean says:

        Thanks for the reply, L1. So, as a matter of risk-mgmt, have you exited your long QQQ position? Doesn’t seem so. (Our horizons might be different, but it seems there ain’t much time left on the P III horizon!) When my measured moves are hit, it’s usually wise for me to exit at least half the position.

      • lunker1 says:

        I don’t own Q’s but I own SPY and was overweight and I lightened up at 1982 and watching for a break in either direction.

      • lunker1 says:

        SPX has a cluster of fib & IHS target in 1982/85 and 3 resistance highs at 1984/5/6.

      • lunker1 says:

        those highs then led to 1953/1956/1963 (and then lower)

  30. Hi,Tony ,if i’m not wrong,this is your’s first count for primary III,do you think it is a valid count yet?i’m still considering an ascending triangle valid too,theoretical target is around 16850,so,it will need to bust that upper trendline of the supposed wedge,thanks


  31. XScaler HB says:

    Tony, the Q’s look (NDX) like they are already beating a path to top first. Wondering out loud if the Nas via the Q’s will tilt their hand first on the reversal at this 5th their in?

  32. pooch77 says:


  33. mjtplayer says:

    Thanks Tony!

    The past few days sure feel like a wave 3 of 3. Extreme overbought conditions and a potential completed 5-wave move from 1,940 – minute iii could have ended at today’s high or perhaps tomorrow morning. A small pullback of 10-15pts for minute iv tomorrow/Thursday then a run to the 1,991 high or just above to complete minor 3 could occur into this weekend/Monday with a New Moon on Monday night 🙂

    Tony – if your count is correct, we’re getting VERY close to a major top. Looks like next week or first week of Sept could be the final thrust before a BIG drop into Oct/Nov. Business could pick-up in the months ahead….

    • pooch77 says:

      1973 tomorrow,1900-2000 eow,than 1940 low next week,should hit our highs mid Sept

    • tony caldaro says:

      biz pick up?
      what emotional bears pounding the table?
      no thank you

      • mjtplayer says:

        No, just looking forward to trading volatility, not inviting the bears to brag A market with a 12 VIX is boring to trade. Although, the bulls have had it too easy for the past 3 years – you have to admit. It’s time the bulls get shaken-up a bit

  34. Hi Tony

    If we start a pullback – would this be that the small “iii” topped and small “iv” began (pullback?)

    I dont know if its minute or micro or what you count , but on your chart you have ii , so if we pullback would this then be start of iv pullback before v to end larger III ?

    Correct ?

    • tony caldaro says:

      depends on size and depth of the pullback as to what label to assign
      we could get a small pullback
      then no label will appear

      • If we go back to 1965 would that then be minor 4? Then minor 5 to 2001-2005

        Otherwise a pull back less then 10 points would be minute 4’with minute 5 up to 2001-2005


      • chicotheman says:

        To me, it appears that the count is dead on. So a dip of say 10+ would be iv and v into probably Friday/Monday. Minor 4 next week and Minor 5 probably in seedling stage before the long weekend. A short minor 5 tops late the first week, a long minor 5 tops late the second week (or so, possibly) of September. A of the big 4 gives us the swoon into October, C of the big 4 is a later “surprise” or “scare” into nervous late November/December low, which sets up the recovery for the big 5 to aim for the high, and if all goes well, run for a while. Everything give or take. Reasonable summation?

        Always appreciative for the ideas shared.

  35. gann360 says:

    Hi Tony

    Thought you would Appreciate this Price to Time Chart $SPX



  36. Thanks Tony,

    Question:……how do you know the difference between a wave extension and a wave that subdivides…..thanks

  37. lunker1 says:

    Thx Tony.

    Micro 1 10pts (1941.5-51.2)
    Micro 4 1969
    5 = 1.62 x 1 = 1985

    maybe small upside to 1984/85 (IHS target 1984) then Minute 3
    23.6% 1974
    38.2% 1968 (again?)
    prior 4 1969

  38. Thanks Tony for the update. Nobody I know navigating this rocky boat better then you. You make one hell of a captain …. I put my ES shorts on at 1978.75 and hoping to swim 15 strokes minimum

  39. llerias7 says:

    The pullback might be the minute iv (1973-75)?…

  40. bouraq says:

    Momentumless gold:

    • torehund says:


      If all the X stuff is over and done With in the middle there is a plausible abc Down from top.
      The small end to the Down misery also looks like a doube zig zag. Thanks for excellent graphs and hope You dont mind me attempting a count on it.

      • bouraq says:

        No I don’t mind at all but it seems that you are forcing a count on something that is not so evident.

    • chrisk44342 says:

      Looks very similar to 2011/2012 chart. A pattern many thought (me included) might have been a triangle, but failed to take out the B wave high, a very bad development for the bulls.

      • chrisk44342 says:

        talking about gold…

      • bouraq says:

        I agree. This doesn’t look good for the bulls for the moment. Everyone is charting a triangle but expecting it to break up: wishful thinking. If the triangle was very large and it was a part of the bull wave I would expect the same but for now it looks more like it is a part of the down move so we can expect it to break down.

    • chrisk44342 says:

      Yes this is why it’s advisable to be cautious when trading triangle breakouts. If the breakout can’t take out the high/low points in the triangle, that can be a problem 🙂

  41. JK1987 says:

    Tony Thanks
    “MEDIUM TERM: confirmation highly probable”
    Int iv will confirm with new high 1992?

  42. 56rambler says:

    Thanks, Mr Caldaro. Are you expecting five Minor waves? So we still need to complete Minor 3, pullback to complete Minor 4, then make a new high for Minor 5? Then that will complete Intermediate V, Major 5 and Primary III? Thank you.

  43. magicianme says:

    In the last 50 minutes of trading futures retraced half the day’s gains … and with large volume selling! So, yes, it doesn’t seem to look very bullish for tomorrow.

    All the days that showed gains in the last week or so did it on very low volume. There’s not much conviction in this rally despite it taking price to near the ATH.

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