wednesday update

SHORT TERM: another consolidation day, DOW +13

Overnight the Asian markets gained 0.4%. Europe opened higher and gained 0.1%. US index futures were higher overnight. At 8:30 weekly Jobless claims were reported higher: 313k v 291k, Durable goods orders were higher: +0.4% v -1.3%, Personal income was higher: +0.2% v +0.2%, Personal spending was higher: +0.2% v -0.2%, and PCE prices were higher too: +0.2% v +0.1%. The market opened two points above yesterday’s SPX 2067 close. After a dip to SPX 2067 the market tried to move higher. At 9:45 the Chicago PMI was reported lower: 60.8 v 66.2. Then at 10am Consumer sentiment was reported lower: 88.8 v 89.4, New home sales were reported lower: 458k v 467k, and Pending home sales were lower too: -1.1% v +0.3%. The market continued to drift higher right into the close, ending the day at SPX 2073.

For the day the SPX/DOW gained 0.20%, and the NDX/NAZ gained 0.65%. Bonds gained 5 ticks, Crude dipped 55 cents, Gold slipped $2, and the USD was lower. Medium term support rises to the 2070 and 2019 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow is a national holiday, and trading will resume Friday for half a day.

The market traded quietly today just as expected during a pre-holiday session. Friday’s half day may just be more of the same. The market has done very little this week, trading between SPX 2065 and 2074. A nine point range over three trading days. Nothing has changed in regard to the medium term count posted yesterday. Short term support now rises to the 2070 pivot and SPX 2040, with resistance at the 2085 and 2131 pivots. Short term momentum ended the day overbought. Happy Thanksgiving and best to your friday trading!

MEDIUM TERM: uptrend

LONG TERM: bull market



About tony caldaro

This entry was posted in Updates and tagged , , , . Bookmark the permalink.

93 Responses to wednesday update

  1. buddyglove says:

    Bye Bye Gold….Lovely Jubely.

  2. Hi Tony,
    Do you think that as a result of lower oil prices, which is a big boost to the economy in terms of savings, discretionary income, retail sales, travel, that the chances of Feds increasing rates earlier is more likely?

  3. sibyn says:

    SPX RCH goal>1618? THX. Merry Christmas.

  4. fotis2 says:

    Pullback Black Friday?

  5. Looks like Horrible Black Friday Sales or some other event coming, I think Monday is going to be bloodbath.

  6. FiveStars says:

    Welcome to DEFLATION. Over all prices will drop for everything, Wages will drop so spending will drop, Stock markets will drop.

    • tommyboys says:

      Lots of hyper-inflationists and deflationists out there. We’ve had out bout with deflation – the worst is behind us on that front – unless you’re Harry Dent. We begin seeing healthy mild wage inflation in 2015 – what we’ve been waiting for – for four years (lotta ‘4’s). Falling oil will be a boon for consumers. Only the oil companies and some alternative energy plays will suffer. Dollar will continue to garner strength and be a positive for US economy. Bull market to continue with corrections and panics along the way – of course. Welcome to 1995…

      • Seriously, TB…..falling oil prices will be a bon for consumers…..consumer prices are rising practically everywhere(insurance, medical, distribution of electricity & gas, education, auto & public transportation, food, shelter, clothing, etc) ….so the tiny savings from commodity gas will be used to pay for the rising cost on the other necessities……just saying.

  7. VIX up almost 9%? somebody better alert The FED time to buy S&P futures and sell the VIX futures. they must be tired from thanksgiving.

  8. bolderbob says:

    Given the big oil news Tony…could you give us your view of the oil market and how it may impact MLPs here in the USA and the US$. Won’t a very large rise in the US$ create a crisis in US stocks as our exports implode?

    • tony caldaro says:

      We have nearly every commodity in a bear market.
      Not sure how lower crude $$$ will impact MLPs, do not follow them.
      A stronger USD generally means weaker US exports. But since the US economy is stronger than most, it also means cheaper exports for Europe. Looks like a wash.

    • Bob,
      Regarding MLP’s, The effect of lower oil will affect the the MLP’s differently depending on the type of MLP it is. If it is an E&P (exploration & Production), it will probably have a substantial negative effect. If however it is a mid stream MLP the effect will be much less since the mid streams make money based on the quantity of oil & gas they move and not the price. If things get severe enough that the economy slumps, and energy usage contracts overall then the mid streams will be more greatly affected since the volumes will be down. If you happen to own a diversified MLP mutual fund as I do then you are going to get a some weakness but not as much as a pure E&P MLP. The other danger resides in the fact that so many of the E&P’s are highly leveraged and if oil drops below a certain level they can’t make their debt service payments and start having credit issues and or loan defaults which could mean they’re gone.

  9. Interesting! Corporation know that Black Friday is losing its appeal here in the USA so they have decided to take it global out of desperation to improve retail sales during the holiday shopping season. Anyone know if this is the first year Black Friday goes global?

    • shadow305 says:

      I am not sure if this is the first year or not, but they are pushing Black Friday sales in British Columbia where I live and Costco is pushing it on their Canadian website for Canada.

  10. trondack says:

    “Economic response to Putin’s 2014 activities?” Are we saying billions of consumers will pay $100/barrel when the rebels lay down their guns. Appears that we need to help the rebels! Actually, someone needs to pull their pipe out of the ground and raise some cattle!

  11. Caldaro funny thing happened to me Wednesday night. Went to a store and the guy working security was talking about the stock market. I asked him if he is in the market and how he plays it. He told me he does nothing but buy 3x leveraged bullish etf’s on DOW & S&P and the Naz and is up 30 % this year. How simple yet effective and most here make it out to be difficult. tommyboys made a good point crashes are generational and chances we will not see another on in our time. A small correction may happen but its like a snow storm. Eventually the snow stops and Sun comes out and its like it never snowed

    • tony caldaro says:

      Security guy buying 3X ETFs, and still working at that wage?
      We all know 3x ETFs will eventually end up worthless, and are only good for a trade.
      Stock market crashes are not really generational, i.e. 1987, 2000, 2007.
      Economic crashes are, i.e. 1929 and 2007

  12. gasman88 says:

    You want to make money you have to buy the dip quick, right at the open. Now enjoy steady grind up, it’s the month end after all.

  13. tony caldaro says:

    Anyone know what caused that 2076 opening print, when futures were trading at 2070?

  14. mjtplayer says:

    The oil stocks are a disaster today, especially offshore drillers which continue to crash – 52wk and multi-year lows across the board.

    Copper at 4yr lows too, commodities continue to be in a bear market.

  15. review of this year’s trades, mkt. updates and new gold trades:
    #gold #investing #spx #goldminers

  16. mjtplayer says:

    tony caldaro wrote: “Economic response to Putin’s 2014 activities?”

    Could be, maybe that’s why Putin has continued building a military force on the Ukraine border? If the US & Europe think Putin will back down b/c of falling oil prices or an economic recession in Russia they are mistaken; it gives Putin more reason/excuse to act-up.

    Never corner a wild animal. Take a step back and provide an opening for the animal to escape, everyone walks away. Otherwise, the animal will fight to the death for it’s survival – whether you’re prepared to or not.

  17. bhupal777 says:

    Thanks Tony.
    As posted on 11/09, Shanghai index is reaching the first target of 2650. Any consolidation from now on, I would be adding more to this trade. If 2650 is taken out with a big green weekly candle that is very bullish for Shanghai index and many months to ride that wave. Good luck all.
    bhupal777 says:
    November 9, 2014 at 8:54 pm
    Re: Shanghai Composite Index

    Regular visitors of this blog know that, I have been pounding the table that Shanghai composite index price action looking really strong for the past 2 months. After today’s intraday move around 2444, it still has 8% more upside left around 2650 to encounter the next major resistance. So with stop loss below 2400 which is around 2% I can shoot for 6 to 8% gain in coming 2 to 3 weeks.

  18. torehund says:

    Looking on the WTI chart, and in large scale it seems like 2009 bottom could have been an A, B-wave at 120 some months ago, then the C wave ends very far Down. So is oil going to 10 bucks or so…in that case just about all liquitity Will have to flee into the dollar and Europe goes bust in a major way.

  19. tony caldaro says:

    Today’s action again confirms your are Mr. Crude in OEW land.
    Kudos! Great call in July at $105

  20. mjtplayer says:

    No cuts in OPEC production, as expected, oil dropping like a stone – down almost $3 and well below $71. Oil below both the 2011 & 2012 lows, next support is the 2010 low around $67.

    Looking at the offshore and deep water drillers, they’re trading as if they’re in trouble. RIG, SDRL & DO charts all look horrible, no bottom in sight.

  21. Happy Thanksgiving Tony and all! What a wonderful world!

  22. bhupal777 says:

    Happy Thanks Giving Day to you all.

    • torehund says:

      Bouraq: thanks for explicit Charts and line analysis.
      What I find striking is the weakness of GBP vs USD, RSI advances yield very little price gains, while RSI declines more than double the decline in price. Thats how bear market show their ugliness…

      • bouraq says:

        Exactly. Especially during a panicky decline like this RSI becomes completely irrelevant. It just becomes more oversold that’s about it.

  23. ariez5 says:

    Hi Tony,
    I’m just wondering why on the SPX 60 min chart you have the 2046-2030 move marked as Minor 4 instead of the 2024-2001 move.
    Happy Thanksgiving.

  24. blackjak100 says:

    Happy T-day! The greatest rally in market history continues with futures hitting ATH right now and oil continuing to get crushed. Why did it take so long to figure out you can have a financial market go to infinity with some creative engineering? I don’t know about anyone else, but the late 90’s still felt like things were more stable than they are now.

  25. fishonhook says:

    A happy TG to all.

    Tony wonder if there is any point in outlining the negative divergences on the short term chart. You have put about six down-sloping lines on the short term chart and yet not one has led to any significant downage.

    I think divergence is the rustiest of all the technical tools, which are a rusty bunch at the best of times.

  26. playitkool says:

    Happy thanksgiving Tony and all who are reading this. Be safe and enjoy.

  27. mharrison60 says:

    Happy Thanksgiving!

    Thoughts please on implications of FTSE in Major 5 whilst DAX / S&P in Major 3 eg is it realistic FTSE will top ahead of these markets? I ask because FTSE seems to be seeing all of major 5 or its just a very strong int a wave – it has pushed up relentlessly since major 4.

    Much appreciated

  28. fotis2 says:

    Thank you Tony and to you and all the ladies and gents that post a very Happy Thanksgiving

Comments are closed.