Tuesday update

SHORT TERM: gap down opening, DOW -85

Overnight the Asian markets lost 0.1%. Europe opened higher but lost 0.9%. US index futures were lower overnight, and the market gapped down at the open to SPX 2111. The SPX had closed at 2117 yesterday. The market continued to decline until the SPX hit 2098 around 12:30. Then it started to rally. The rally lasted most of the afternoon as the SPX made it back to 2109 by 2:30, then dipped to close at 2108.

For the day the SPX/DOW were -0.45%, and the NDX/NAZ were -0.55%. Bonds lost 9 ticks, Crude gained 75 cents, Gold slipped $2, and the USD was lower. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2131 and 2198 pivots. Tomorrow: the ADP at 8:15, ISM services at 10am, then the FED’s Beige book at 2pm.

The market gapped down at the open today for the first gap opening in well over a week. As the market continued to decline throughout the morning it wiped out all of yesterday’s gains, last week’s trading range, and hit SPX 2098. As a result it appears Minute v may have failed at yesterday’s SPX 2118 high, completing Minor 3, and Minor 4 is underway now. There are, however, two other potential counts which were noted in the weekend report. For now, we will remain with the one posted on the SPX hourly chart, which suggests Minor 4 support around the 2085 pivot range. Short term support is at SPX 2098 and the 2085 pivot, with resistance at SPX 2120 and the 2131 pivot. Short term momentum hit oversold today before bouncing to neutral. Best to your trading tomorrow’s ADP and Beige book!

MEDIUM TERM: uptrend

LONG TERM: bull market

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

About tony caldaro

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143 Responses to Tuesday update

  1. bhupal777 says:

    Thanks Tony.
    Have you observed that it is not even 8 PM EST and there are over 140 responses posted on this blog. That tells me that either lot of this blog participants are looking for a bear turn and got excited with 2 days of down move OR is it just a sheer coincidence that we have more responses today.

    This is what we know so far…. monthly and weekly trend is up. Your primary count is bullish. All my watch list stocks that broke out a month ago (which I did update on this blog) made sizeable moves and consolidating nicely. My stops didn’t hit yet means I am not shaken out yet.
    But my KRE position is taking longer than what I thought to breakout. But good sign is it did reverse at 20 day SMA and the down day volumes are lot less than up day volumes. More over I see a cup and handle pattern started on 02/17 after a huge January and February months upside move. I consider that as bullish pattern. Let’s see what market brings to me in coming days.
    Good Luck All.

    • bhupal777 says:

      BTW as latest as tomorrow EU starts wire transferring the stimulus money into big banks. In this fast electronic world it doesn’t take long for that money to percolate into stock markets. OR the big boys wants us to left at the train station before going for a nice ride…. that means a very scary short term RED days coming. Either way it is better to have neither a bear mind nor a bull mind but an open mind.

    • tony caldaro says:

      when the market goes down many awaken

  2. nardobeme says:

    Long $RUT @ close. GL everybody!

  3. torehund says:


    Update on the latest nanocap popper. Remember as always, small companies are Dangerous stuff…

  4. lunker1 says:

    SPY open 210.40 Close above leans bullish

  5. Dex T says:

    Well it’s been reported that a near majority of the Fed now support a rate increase come June. They are going to announce (in their convoluted language) the increase at the March meeting.


    Hopefully they actually do it and continue tightening over the course of the year.

    Could it finally be the end of the bull?

    • buddyglove says:

      Not the end of Bull imo.
      Summer rate increase has been well telegraphed and is priced in, besides zirp is no longer needed as economy and global reflation is well underway.
      However when the Fed does raises rates, I would expect Bonds to experience a “Bear Flattener” (short rates rising faster than long).

    • tommyboys says:

      Likely no rate hike until late this year at earliest. Why so many want the bull to end is beyond me. ..

      • Tommyboys: Excellent posts.

      • Dex T says:

        It is highly likely! Evans never wants rate increases but he is only 1 of the members. They have been planning it for years now.

        I want interest rates to rise to provide a secure source of fixed income and to test the real strength of the US economy. The current low rates punish savers and reward speculators.

        The bull is coming to and end and people are trying to figure out the best way to position themselves .

        • tommyboys says:

          “Bull coming to an end” is just one opinion. Mine is that we’re in ’93-’95 and while we’ll have corrections we’re in a secular bull that will last 14-20 years like the rest. If so there I a ways to go. Higher rates bullish to a point and corrections aren’t bears.

      • simpleiam says:

        Agree with the timing of the hike (if not even later), and like you, don’t understand why so many want markets to fall… Except if they’re lined up short.

  6. lunker1 says:

    You’re quiet Tony. No a or b on chart yet. Thoughts?

  7. fotis2 says:

    Trying a small swing trade here long 2093 stop 2084

  8. I’ve been short since 2050 and have felt alotta pain, but I have a feeling my pain will soon turn to pleasure. Everyone is bullish waiting for next wave up and salivating at the mouth because ecb is printing… Sounds like a great time to top off the market or start a primary 4 down.

    • hope you are right newbie but market is not just a feeling 😦 it’s central banks manipulating. there is one rule up and up and up and we are fed up

      • tommyboys says:

        …afternoon bears

        • fishonhook says:

          i dont think TA really works anymore with CB diving into the market.
          neither does most analysis. spoke to a bond guy and he says there is no way of forecasting bond prices based on old metrics such as inflation expectations, supply etc. the CBs are the market now

        • fionamargaret says:

          …..afternoon bears watching……?

  9. fotis2 says:

    Just wondering if minor 4 can be this simple usually they are a bit more complex no? And time wise

  10. Per my wave count;
    SPX W4 retrace 0.382*W3 = 2088 (32 pts)
    ES W4 retrace 0.333*W3 = 2085 (33 pts)
    oh yes and bounce from today’s low is impulsive.

  11. simpleiam says:

    Really looks like C&H formed today. GL to All!

  12. gtoptions says:

    Stuck on Manic Monday.

    Thanks Tony
    The Bat Man worked pretty well. 😉
    Possible it makes a LL with +div, but who wants to wait for that. Use stops to be safe.
    Projection Target range 212.69~214.86
    GL All


  13. ashram says:

    SPX has retreated into the vicinity of the Dec high. There is Fibonacci and chart support at 2085, and chart support in the mid-2060s. While SPX could hold at these higher levels, it would be constructive if the market can decline into Friday’s cycle while achieving oversold readings on momentum indicators that are consistent with the lows of the past two years.

    Thus far, just a pull back in an uptrend. A close under 2058 would complicate matters.

    The first time Naz hit 5000, it briefly got spanked and then rallied eight percent in two days:


  14. lunker1 says:

    the measured move from 2120 to 2104 found ideal target 2088.

    • H D says:

      nice work, it’s all math. Ur basically using the same math i do and I’ll be the first to let you know- 60% of the time it works every time! 10 handles from that 2088. Kudos!

    • ashram says:

      It is a .231 retracement of the SPX rally from the 2/2 low, which if it holds indicates the angle of ascent is steepening. Seems awfully shallow, but this is a powerful market.

  15. GYN LAB says:

    3min chart developing IHS with neckline 2093, if confirmed target 2098-99

  16. purplember says:

    tony, assuming 2085 is key support point; otherwise we’re looking at a much larger retracement

  17. wavediver says:

    It indeed looks like minute v failed. Would that indicate potential weakness for the minor 5?

  18. lunker1 says:


  19. buddyglove says:

    ECB QE starts this coming monday, CB cash not even flowed into Equities yet, and 60 bill a month has to go somewhere… only place with any yield is Equities.
    No change of opinion…Equities and Bond yields up (treasuries) into spring early summer and
    I am looking to position short the Long Bond into any strength.
    Aimho glta.

    • joecthetruthteller says:

      Why The Drachma Can’t Save Greece – Goldman
      Fears Greece may exit the euro and revive the drachma abound, but attempting a return to the currency Athens left behind would have tragic results, Goldman Sachs said.

      “Transitioning from the euro to a new national currency is no straightforward task either for Greece or for Europe,” Goldman said in a note Monday. “Greece can’t just (re)introduce a national currency.”

      Debating whether to rekindle the drachma, or drachmatization, isn’t just an academic question. With negotiations over Greece’s debt and finances proving touchy, the possibility the country may exit the euro zone, a scenario dubbed “Grexit,” has become more likely, analysts say, although they still assign a relatively low probability.

      “The probability of an accident is still there,” Goldman said. (CNBC – Continue Reading)

      • buddyglove says:

        Goldman talking Greece down…….Fill yer boots.

      • simpleiam says:

        buddy is correct. If it just stops with Greece, then, wouldn’t be problematic (except for Greece). If other weaker economic countries follow Greece, then, Germany might as well go back to Mark, as Euro will become quite strong. IMO.

    • fionamargaret says:

  20. manunidhi21 says:

    Namaste Tony!

    Is the count right ?


    With a slash of interest rate in January and may be another today, they are pretty well managing things except Oil

  21. Hi Tony,
    IMVHO we have put in at least a medium term top. I see plenty of room on the downside from here. At this point, in this 6 year bull market, it is possible to say that we may have found the elusive P3. Nevertheless, SPX 2120 is significant because recently in September we turned at SPX 2019 to SPX 1820. More recently, we hit a Major 4 bottom at 1980, which is 2000 minus 20. In December, we top out at SPX 2079 approx. 20 from 2100. Primary 1 top at 1220. Here we are 900 points later. Primary 1 completed in 13 months. Primary 3 completed in 58 months 5+8=13. Just a few interesting observations.

  22. sibyn says:

    DAX goal very short term 11180 today.

  23. No clear signal yet from model for last 24 days. Remarkable!! Anyway, we are closer to top than bottom. There could be attempt to flush bear out but that is it.

    It wont be long before “loss of confidence in FOMC”.

  24. sibyn says:

    If RCH are in play now, (roadmap) down to 2082 then up to 2100,8 then goal 2051,5, short term.

  25. gasman88 says:

    Million dollar question, has the oil bottomed according to OEW?

    • rabbittrader1 says:

      My answer FWIW, having spent 10 years in the oil & gas business, having known Ken Crandall, V.P exploration ,Standard Oil of California, and many Texas Oilmen and Colorado Oilmen, and having studied the OIL business in 1966 and analyzed ENERGY etc, for General Dynamics and having studied “Risk analysis in oil and gas exploration:” Maybe I could venture an opinion. I believe we saw an INTERIM bottom in WTI crude OIL at about $43 per barrel. The next stop should be at $57 per barrel by mid March, then a move to $60 by end March, then a possible move to $60 to 65 per barrel by mid April (maybe $70 for a brief time) then a leveling at $60 for some months before a resumption of the decline into 2016 to $25 per barrel. In EW terms we are now in a 4th wave up before a long fifth down. Yours Rabbit.

    • tony caldaro says:

      Crude could have bottomed.
      But personally expecting one more downtrend for the bottom.

  26. bhupal777 says:

    Thanks Tony.

    Added more KRE April 42 CALL options in addition to March 41 CALLs I already have.
    Nice consolation going on, I am guessing this Friday jobs number should give KRE a breakout opportunity.

  27. bouraq says:

    Today’s post: http://www.tradingchannels.co.uk/2015/03/march-3-2015.html

  28. vikasvrao says:

    Tony, any thoughts on AAPL here? Thanks!

    • buddyglove says:

      Tore…Yep, I’m with you…DryShips was well bid today.

      • torehund says:

        🙂 never giving up 🙂

      • hkloon says:

        Hi Buddyglove, may I ask how do you see if drys is well bid? Do you look at the buying price and selling price and its volume or queue volume or etc…. hope can enlighten some. thx. When I looked at the candle, it looks like a gravestone on daily chart, don’t know if it means anything but certainly it looks to hold 0.9 line. regards

  29. M1 says:

    Thanks Tony
    The pullback came as expected. (NAZ abt 5000)
    The last pullback was three weeks ago, lasted two days and it was 68 points
    This one is already 52 points.
    I would expect a choppy market during the next days and around NAZ 5,000.

  30. llerias7 says:

    Well…a 38% retrace of this minor 3 puts us at 2066 i.e. oew2070…I suspect it will be extended in time…may be producing another triangle…will see.

    • asaraniti says:

      wave 4 often corrects 23.6% – 38.2% of wave 3
      I have a 30 point decline to 2090.
      2042 -2120 = 80 point wave 3 rally 80 X .38 = 30
      will see what TC has….

  31. fotis2 says:

    Thanks Tony so a minor4 hey? looking forward to that I’m sure the site’s Bears will extremely pleased with that count. 🙂 🙂

  32. tony caldaro says:

    gave it back to him =)

  33. simpleiam says:

    “…God slipped $2,…”
    Hmmm. Not sure of the psychology behind that slip, but it’s entertaining!
    Thanks Tony!

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