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

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93 Responses to wednesday update

  1. sibyn says:

    SPX RCH goal>1618? THX. Merry Christmas.


  2. fotis2 says:

    Pullback Black Friday?


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


  4. 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…


  5. 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.


  6. 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.


  7. 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.


  8. 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!


  9. 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


  10. 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.


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