thursday update

SHORT TERM: gap down opening then rebound, DOW -25

Overnight the Asian markets lost 1.5%. Europe opened higher and gained 0.2%. US index futures were sharply lower overnight. At 8:30 weekly Jobless claims were lower: 264k v 287k, and at 9:15 Industrial production was reported higher: +1.0% v -0.1%. The market gapped down at the open to SPX 1841, then dipped to 1838 before rallying. At 10am the Philly FED was reported lower: 20.7 v 22.5, the NAHB was lower: 54 v 59, and the SPX hit 1853. Then after a quick pullback to SPX 1835, the low for the day, the market then rallied to 1858 by 10:30. After that we had several swings over the next hour: 1844-1862-1852-1868 by 11:30. Then the market pulled back to SPX 1852 by noon, before rallying to 1876 by 1:30. Wild swinging market again today. The market then pulled back to SPX 1857 by 3pm, rallied to 1868 just before the close, then ended the day about where it ended yesterday 1863.

For the day the SPX/DOW were mixed, and the NDX/NAZ were mixed. Bonds lost 19 ticks, Crude rose 90 cents, Gold added $2, and the USD was higher. Medium term support remains at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Tomorrow: Housing starts, Building permits, and a speech from FED chair Yellen at 8:30. Then Consumer sentiment by 10am on Options expiration Friday.

The market gapped down again at the open, third gap opening this week, hit SPX 1838, rallied to 1853, then hit 1835. Holding yesterday’s low of SPX 1821. Then the market rallied in a series of overlapping waves to SPX 1868, pulled back to 1852, then rose above yesterday’s 1869 high when hitting 1876. A higher high and low after yesterday’s nasty selloff. The price action since yesterday’s SPX 1821 low has been quite different than what we have observed during the entire 2019 to 1821 decline. A change like this sometimes equates to a change in trend. As a result we are labeling yesterday’s low with a tentative green Major wave A. And, will start tracking the current rally as if it was/is Major wave B. As long as the SPX 1821 low holds we could rally into early November. Short term support is at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Short term momentum continued to rise above neutral after yesterday’s extreme oversold reading. Best to your trading OPEX!

MEDIUM TERM: Major A downtrend may have bottomed

LONG TERM: bull market but in P4


About tony caldaro

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231 Responses to thursday update

  1. reddragonleo says:


    The “one more wave down” I was looking for yesterday is likely out of the question now. I’m now looking for that gap up on Monday too. The projected target on the IWM is the previous “double top” zone around 115.50 for it and for the SPX it’s that 1970 area.

    Also, I see that you mentioned a possible double top area… which is what I’m thinking too. My thinking is that the bears will short this all the way up and SkyNet (again, that’s just what I call the super computer running the market) will just keep going up hitting the bears’ “buy stops” on every move higher.

    I believe the FP I have of 202.45 SPY is real and will be hit. That’s about 2024.50 SPX and would be a “slightly” higher high. I don’t know how Tony will see the wave count then but I do know that this rally up will be very tricky, fooling all the shorts.

    It has to fool the shorts in my opinion if you are going to have another huge wave down to 1500-1600 area. Look at the May-August 2011 chart for clues. I think we are on about June 27th, 2011 today, but I don’t think we’ll see a slightly lower high as happened on July 7th back then but a slightly higher high (main reason for that thinking is the FP on the SPY).

    So possibly some kind of A wave up to end Monday or Tuesday morning. Then down for some B wave and up for the final C wave into the 28th/29th? Guessing on all that but as we know they love to strength the market to extremes on both the bullish side and the bearish side.

  2. mrgreen2010 says:

    Armstrongs 16331 DOW number sure looks to be key. I personally want more of a bounce to buy puts into.

  3. lunker1 says:

    SPX IHS similar to Oct 1/2 V bottom w shallow shoulders. target 1975.
    first looking for touch of upper 1869 pivot 1874/6 for RS.

  4. FiveStars says:

    Expecting SPX to finish in the upper range of 1890+.

  5. gary61b says:

    spx 60 min has a possible neckline at around 1998-99 level its huge if it is a IHS

  6. rc1269 says:

    can’t help but wonder about this monday having the same date as black monday ’87. give where we are in the wave count

  7. mrgreen2010 says:

    FYI, Marty Armstrong gives 16331 in the Dow as a key level to hold by EOD otherwise more selling is possible. I am surprised by the weakness after the EU close. Adding longer term puts in PCLN, CMG, V and VIX Calls

  8. Summing up Markets psychological behavior for the past 4 weeks…………….

  9. perversionofthemean says:

    Rejected at 50% retracement of wave c — 1968 high and 1813 low on ES.
    That level is also the 38% retrace of the ATH to 1813.
    In analyzing previous re-tests of 200-day moving averages from below, the 1st test appears to close at the average, which is 1897 today. Cash SPX is 10 below there presently. I think JK is on to something by being short.
    How much of a retracement should a P IV major B be? Are there guidelines based on P IV targets for its low? (e.g.: if this is going to be a deep P IV, should B be weak, etc.?)

  10. Hello fellow Calderoites, does anybody have an opinion on GDX here please? Gold has so far rallied $60 off of its low and GDX is up 70c.. Bought at 22 (too early lol) with a target of 24.50.. Now I’m thinking 22.70 would be nice (38.2% of the third wave down).. Would any of you kind folks care to post your LT/ST counts? Thanks 😉

  11. JK1987 says:

    Anyone? Do we have enough time to close SPX in red today?
    RUT red already.

    • cmucha68 says:

      If we go below 1975 today I think so could be

    • rc1269 says:

      there’s always enough time JK

    • perversionofthemean says:

      Too much emphasis was placed on the relative strength of RUT in the last few days as a sign “the” bottom was in. It definitely helped signal the low, but historically any strength exhibited within a decline is ephemeral. Being red today is a big negative. It’s done a 38% retrace of the move down from the ATH, but lacks the kind of base structure that SPX or even QQQ.

  12. sibyn says:

    My calculations right now…
    1898>1859>1958 OR 1898>1859>1760
    LiS 1859 up or down. Very important LiS 1859. Down at 1859???

  13. rc1269 says:

    the Fed, in all its wisdom and clarity

    “The markets are making a mistake” and expect the Fed to maintain its ultra-
    easy policy stance longer than Fed officials themselves currently expect, Mr.
    Bullard said. When it comes to these expectations, “I would prefer that those
    be better aligned than they are.”

    “We could just end the program in December. But if the market’s right and this
    is portending something more serious for the U.S. economy, then the committee
    would have an option of ramping up QE at that point.”

  14. Retracement levels back to the highs thus far reached … DOW 38.26% … SPX 38.83%.

  15. As mentioned the astro suggested a bottom yesterday in markets. Astro vedic support a rally higher in coming weeks before next sell off starts.

    Tony , any clue about how high wave B rally could be ? I’ve seen they retrace most of the losses in recent years…

  16. mjtplayer says:

    Instead of an ABC up for major B, it’s also possible to just melt-up on one wave; if we close on the highs today, we could continue into Monday and/or Tuesday and just head straight-up to the 1,920 area to complete major B all in one shot.

  17. drwarmington says:

    Rabbit Trader …. Could this big gap up be a day early for your count? Or more ahead on Monday?

  18. mrgreen2010 says:

    1900 active now expect chop as positions get squared…closed my OEX and Q calls…letting GPRO ride..hoping it hits 80 MAX PAIN…75’s still a pain to some.

    • magnus1234 says:

      Closed my esz4 as well but willing to re- enter monday/tuesday. Appreciate your option analysis eventhough im only trading futures. They act like twins and anti-twins.

  19. gtoptions says:

    Thanks Tony
    SPX daily 13 ema @ 1912 ~ looks like a good target before a reversal.
    Thanks to all. GL & Good Weekend

  20. Walter Crane says:

    I remember telling someone years gone by that was bearish that it looked like we were setting up for a huge WAVE 3. I didn’t know Tony at that time, Wish I did. I just wonder though, if we just had a big wave four already starting with the end of primary wave 3 on sept 18th and then A being the first wave down, then the big new high B and now the C down. It sure would fool just about everyone wouldn’t it? Just a thought. No trading position right now.

  21. bhtrade says:

    Pin SPY 190?

  22. buddyglove says:

    Hey all. Just wanted to say what a great team are currently working in this forum. Many differing areas of expertise coming together here including T.A., wave counting, strategic thinking, trading skills, credit-mkt expertise and lunar forecasting, quite a powerful synergy, and of course like all good teams this one has a great leader. Good health and gl to all.

  23. blackjak100 says:

    Moving higher than I thought it would – when will RUT bring us back down.

    • kvilia says:

      Watch for closing. I think B extends higher.

    • mjtplayer says:

      OPEX – the largest open interest strikes are around the SPX 1,900 area. I knew the market would rally, but this is more than I was expecting too. Thought 1,900 would be too far to reach, guess not. Looks like the bankers don’t want to pay out on the 1,900 strike puts, the house wins again!

  24. JK1987 says:

    1894, that’s enough for me for Major B, all out.

    JK1987 says:
    October 15, 2014 at 9:04 am
    Apparent Major A, or that’s all for Primary IV?;

    Anybody all in at 1837.22, or close to the panic bottom? 🙂

  25. perversionofthemean says:

    I see the clear breakout from the IHS, and even the wimpy snap-back to test the neckline. At the same time, we’ve rallied to the 1901 pivot which represents some overhead resistance from August and matches the daily closes of April/May. It’s also where the 200-day moving average lies.

    I’ll whine and remind that I “dislike strongly” the market tendency to make big moves while I’m sleeping. Lacking the constitution of SoulSurfer, and suffering from excess self-opinion, I tend to think I need to man the keyboard when positions are taken (just my leveraged ones).

    • mrgreen2010 says:

      Like your name the markets have always been perverted just the last 5 years with QE it has not been easy to day trade …just buy and hold knowing the turn is due and keeping daytrading to a minimum. I see that changing…when bears break that hold the free market will try to reassert itself. I wont touch futures/forex unless I man the many greedy gameing assholes out there.

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