tuesday update

SHORT TERM: higher open-new high, DOW +30

Overnight the Asian market lost 0.3%. Europe opened higher and gained 1.0%. US index futures were higher overnight, and at 8:30 Durable goods orders were reported higher: +22.6% v +1.7%. At 9am Case-Shiller was reported lower: +8.1% v +9.3%, and the FHFA index higher: +0.4% v +0.4%. The market opened three points above yesterday’s SPX 1998 close, and continued to move higher. At 10am Consumer confidence was reported higher: 92.4 v 90.9. The market continued to drift higher until European markets closed and the SPX hit 2005. After that, like yesterday, it started to pullback. The pullback lasted into the close with the SPX ending the session just above 2000.

For the day the SPX/DOW were +0.15%, and the NDX/NAZ were +0.20%. Bonds gained 2 ticks, Crude rose 50 cents, Gold rallied $6, and the USD was higher. Medium term support remains at the 1973 and 1956 pivots, with resistance at the 2019 and 2073 pivots. Tomorrow: nothing on the economic schedule.

The market opened higher today, followed the rally in Europe, and hit a new all time high just about when Europe closed at SPX 2005. After that, like yesterday, it went sideways for the rest of the day. Thus far we have counted Minor waves 1 and 2 at SPX 1945 and 1928, and now a five wave Minor 3: 1964-1942-1995-1985-2005. With Minor 3 just about double Minor 1 (77 pts vs 40 pts), and the rising Minute waves of Minor 3 all near fibonacci numbers (36, 53, 20 vs 34, 55, 21), it might be time for a Minor wave 4 pullback. Especially with the ongoing negative divergence on the hourly chart. Thus far all we have seen is a five point pullback to SPX 2000. Should the pullback drop below SPX 1995 Minor 4 is probably underway.

Short term support is at SPX 1985 and the 1973 pivot, with resistance at SPX 2005 and the 2019 pivot. Short term momentum continues to display that negative divergence. The short term OEW charts remain positive with the reversal level now SPX 2000. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: bull market

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

About tony caldaro

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97 Responses to tuesday update

  1. FiveStars says:

    Bunch of people screaming why markets are up … more they scream, higher the VIX goes .. so is this called volatility?


  2. Tony and One might have nailed it again.

    Any guesses where next stop will be? 1985? 1973? etc.?


  3. gtoptions says:

    Thanks Tony
    SPY ~ WPP @ 198.55
    Gap Fill #1 complete, #2 on tap. 😉
    GL ~ Enjoy the Labor Day WE all.


  4. These criminals are holding the 2000 level hoping a bunch of uniformed sheeple have been reading the SPX 2000 headlines and are at their local Scottrade dumping their 0% interest rate savings accounts back into the market before a massive move to 1700 or simply a crash.


  5. oneandonlyuniverse says:

    @ Red Dragon

    ” I probably only win 70% of time with my own trading. Not really that great as I’d like to be 80-90% accurate, but it’s tough in this market.”

    Seriously ????? 70% puts you ahead of Steve Cohen, Paul Jones , Bruce Kovner ,and
    Jim Simons of Renaissance, most prolific hedgie of all time is high 60’s win rate with his programs.

    70% would put you in the traders hall of fame ( IF ) you knew how to cut losses.

    You sound a bit green and that comment was more than a bit dodgy.


    • Lee X says:

      Keeping in mind this is an internet blog I say that’s a low % 😉
      More than a few guys who stood on the top step in the pits batted about 95% but of course that was back in the day…sucks to get old ok time to mow.


      • oneandonlyuniverse says:

        95% , nothing better than getting in front of customer flow.Yes, those were interesting times . Spear Leeds giving 100 to 1 leverage. The long island dream was Getting a GED / trading natgas / marrying a girl from the city.


      • hrmny358 says:



    • tmac24 says:

      70%? do you only buy every 4-12 years? if you are a daily trader of futures or ETF’s 70% win rate would be good, what is your average gain vs average loss on those trades?


    • I trade options mostly. I do call spreads and put spreads where you can make 50%, 100% and even 200% on a small amount of money. Why put a $100,000 at risk to make a 5% gain when you can put $5,000 at risk to make a 100% gain? Not saying that I make $5,000 dollar bets on options all the time but I have in the past.

      On the losing side I have a stop lost of 25%-50% depending on how much money is at risk. Sometimes I’ll play both sides to offset possible losses, while also limiting the gain on the other trade.

      It’s not easy by any means. I’ve won 7 in a row with low gains in the 50% area and the best trade was 250-300% (I forget the exact amount). Then I lost 3 in a row and took a 50% hit on each one. Only betting a certain amount on each trade keeps me in the game.

      If I double down (or triple down) on some bet and then that one turns into a 25-50% loser then it’s going to take a lot of winners to make up for it. So I try not to do that (although I have been stupid enough in the past to do a few times… but survived).

      I may trade 3-5 times a month, or 3-5 times a week. Just depends on the setup. I have to wait for that wave 3 or C wave to appear. I missed the recent one up as I wanted a decent pullback to join in on it but never got it.

      But believe me…. it’s not easy to watch your position go up and down such large percentage moves from day to day. Seeing it drop 20% quickly because you missed the top or bottom sucks, but if you know (or think you know) that’s a turn is near you wait it out.

      The trade that gained me 250%-300% started out the first 2 days down 25-30%, but I felt that it would turn back up and rally before it expired a week later. So I hung on and sold it the day it expired “in the money” 250-300%. Not all trades work out like that of course.


  6. uncle10 says:

    Thanks Tony.
    Think it may be a good time to start buying some Corn. gd and gl


  7. magicianme says:

    Almost four hours into trading and my futures screen shows volume at under 500K. It usually crosses that half a million mark within the first 30 minutes after the market has opened. Heck, I’ve seen days where it hit 500K before the market opened.

    Amazing! Where is everybody?


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