friday update

SHORT TERM: market gaps up, DOW +91

Overnight the Asian markets gained 0.6%. Europe opened higher and soared 2.1%. US index futures were much higher overnight, and at 9:30 FED governor Tarullo’s speech: The market gapped up at the open to SPX 2065 and continued to rise. The SPX had closed at 2053 yesterday. By 10am the SPX hit 2071, was extremely overbought, and began to pullback. The pullback found support at SPX 2057 around 1:30. Then after a choppy rising afternoon the market closed at SPX 2064.

For the day the SPX/DOW were +0.50%, and the NDX/NAZ were +0.25%. Bonds gained 5 ticks, Crude rose 75 cents, Gold added $6, and the USD was higher. Medium term support remains at the 2019 and 1973 pivots, with resistance at the 2070 and 2085 pivots. Today the WLEI was reported higher: 47.6% v 47.2%.

The market gapped up at the open today on a rate cut in China and more ECB talk of QE. By 10am the SPX hit the 2070 pivot and then started to pullback. The pullback bottomed just above Tuesday’s SPX 2056 high. Our long standing Q4 2014 target of SPX 2070 has been reached. We already have new targets, but will not publish them until January. After that low, the market went into a trading range for the rest of the day. The key level to watch heading into next week is SPX 2040. Short term support is SPX 2040 and the 2019 pivot, with resistance at the 2070 and 2085 pivots. Short term momentum ended the day around neutral after hitting extremely overbought this morning. Best to your weekend!


About tony caldaro

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44 Responses to friday update

  1. John Arella says:

    back in September I posted this chart below forecasting a short and quick wave 4 followed by a quick wave 5, the chart in question is below. Most were looking for 1600 spx bottom while I saw a trendline possible in the mid 1800 spx

    the results compared to my projections are below, I saw it hitting the top channel and overflow like it did in the bottom channel near 2075-2100 rang. once it hits this range I expect a drop to happen which will again catch everyone off guard. good luck to all 🙂

    • John Arella, come here and give me a high five buddy!

    • lunker1 says:

      “Most were looking for 1600 spx bottom while I saw a trendline possible in the mid 1800 spx”.

      well let’s tell the truth John. you said 1880 not mid 1800s and when it hit 1820 you scrapped your own chart.

      • cmucha68 says:

        Hey Lunker, I know you are the Sheriff here and always looking for correcting everyone on Tony’s behalf. Now to say it in your own words like you did recently l:” you have more then 3 posts today. So please respect Tony’s order and stay away from posting more. You clearly violate his rules. Shame on you.

    • The SPX Bearish Butterfly that bottomed @ 666 and Yearly R2 both top out between 2130-40, should be interesting to see where SPX goes from that level…

    • cmucha68 says:

      Forecasting is one thing, putting the money where the mouth is another. A lot of people can foretell where the market is going but never any money. Because when it comes to real trading they becone afraid. But I suppose you do not belong to that kind of guys. If you actually traded what you said you must have grown rich know, right ?

      • John Arella says:

        Lunker I estimated 1880 given it went down in September but it was actually 1850 if you check the trend lines on my chart, a 30 point over-through did not invalidate the chart just like a rise to 2120 will not invalidate the chart on the upside but a rise to 2180 would signal a serious break of the channel.

      • John Arella says:

        hi emucha68 I did make a good amount on yahoo calls because of the trend lines and being tied to alibaba. I will buy puts on spx once we hit 2080-2100 area with a stop at 2130.

  2. Ajay Singhi says:

    Hi Tony,

    CNX nifty is in 5th wave of an ending diagonal. What’s the maximum a 5th wave of an ending diagonal go to?



    • jeffbalin says:

      Very interesting, thanks X. However if the current count is correct the opposite may happen, peak around mid Dec and begin a 10% drop. Or, at least no small drop if we keep extending. But, interesting. Will trend continue?

  3. Hi Lunker, I just saw your question from earlier re: opening range.

    I will use both cash and futures, but for the most part, the one time I typically defer to the futures is during the opening. To me, the opening range should be price based, not time based. On a Big Up signal, gap up openings are common. Often, the opening range high is the high of the day. I won’t buy a swing position until price trades through that high.

    I use a regular trading hours chart (9:20EST – 16:00 EST) for this, and I do not concern myself with the globex high/low. The most important fact for me to observe will be “is price above its opening print and trending higher, or is it below the opening print and trending lower.”

    For me, the opening range can be set in a matter of seconds or it can take much of the first hour. I look for a high & a low, (not necessarily in that order, of course) and retracement. I have no set retrace amount. For me, defining the opening range is sort of like how Potter Stewart defined pornography, and thus I’ll end with this: “I shall not today attempt further to define the kinds of material I understand to be embraced within that shorthand description [“opening range”], and perhaps I could never succeed in intelligibly doing so. But I know it when I see it.”

  4. purplember says:

    tony, not quite sure why “not publish new targets until January” why wait 45 days?

  5. M1 says:

    Are we still far from a silver uptrend confirmation ?

  6. M1 says:

    Thanks Tony
    It looks like we are living in the QE & LR (low rates) world =)
    hakuna matata

    have a great wekend

  7. CB says:

    Thanks Tony. The $NYAD chart appears to be the most intriguing chart to watch right now as it has been lagging for some time and it is still labeled as previously: a …of abc ? Looking forward to your comments on that when you get a chance Tony.

  8. wtf10 says:

    Thanks for all of the hard work, analysis and insight, Tony.
    You’re a BIG tease! January… Seriously?😎

  9. fotis2 says:

    Thanks Tony looking forward to next week one thing for sure it wont be boring:)

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