Monday update

SHORT TERM: market rebounds, DOW +139

Overnight Asian markets lost 1.1%. Europe opened lower as EQE started, and lost 0.5%. US index futures were higher overnight, and the market opened three points above Friday’s SPX 2071 close. In the opening minutes the SPX dipped to 2072 and then began to rally. Just before 2pm the SPX hit 2083, dipped to 2078, then hit 2083 again just after 3pm. The market then pulled back to SPX 2079 to end the day.

For the day the SPX/DOW were +0.60%, and the NDX/NAZ were +0.30%. Bonds gained 13 ticks, Crude added 35 cents, Gold ticked up $1, and the USD was lower. Medium term support remains at the 2070 and 2019 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow: Wholesale inventories at 10am.

The market opened higher today, from Friday’s extremely oversold condition, and rallied to SPX 2083 before ending the day at 2079. This is the first notable rally since the recent decline began this past Thursday at SPX 2104. So far the Fibonacci support at SPX 2067, a 38.2% retracement, has held. Again, however, the market ran into resistance at another obvious level near the 2085 pivot. To continue this rally, and add support to a potential Minor 2 low, the market needs to rally beyond the OEW 2085 pivot range. Short term support is at the 2070 pivot and SPX 2051, with resistance at the 2085 pivot and SPX 2120. Short term momentum ended the day at neutral. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: bull market


About tony caldaro

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112 Responses to Monday update

  1. Peter Sliney says:

    The daily gap on the SPY between 2/2 and 2/3 has a high probability of getting filled before we make any new highs. IMO.

  2. Dex T says:

    No buying power today. This day is trading just like Friday and on that day the market closed near its lows. Will the same be today? Only about 45 min until the close

  3. sloop says:

    final 5th done?

  4. CB says:

    would be cool if from this ST oversold we can rally to the prev low at 2067ish ..
    This market is a bit overdone ST..
    Mr. Market today >> (maybe a little too loud for your taste : )

  5. mjtplayer says:

    Still no fear or panic, the spot VIX has been very orderly, not even a tick above 17 – nevermind 18. No bottom yet…

  6. torehund says:

    Think most oil comps and realated activities could depreciate further 40-60 percent, mostly due to the dollar. At that time there Will be very good buying opportunities.

    • torehund says:

      year 2001 prices looks to be tested for oilcomps, and buying Exxon at 40 usd, Stateoil for 6 usd or Petroleo Brasileiro for 2 usd, bargain bin worth waiting for…

  7. sloop says:

    looks it was a little 4

  8. Tony, Pl. don’t get wrong impression, but could you say WROC which was triggered at 2058 of SPX is still valid?From the time of signal SPX went to 2098 a week after, then to 2108 and now below that signal. Is it ST, MT or LT signal?

  9. lunker1 says:

    Double +D 60min RSI 5

  10. bhuggs52 says:

    Anybody, is the SPX presently in a “bear flag”?

  11. Super Mario is now apparently buying European sovereign debt. “The Central Committee will consider all assets except gold.” I wonder if he’s interested in a bridge that I know is going cheap. How about a clunker? The latest mail on European sovereign bonds is that there are very few available. Yields on German, Italian & Spanish 10 yr bonds are already down to 0.19%, 1.22% & 1.25% respectively and Super Mario is only just starting to open his wallet. How bigga da bubble you won, eh?

    • Congrats . I am happy to be the only person that responded to your comment.
      Makes no sense , buying sovereign bonds at these ylds. Not many get that. Best post of the year.

    • CB says:

      they’re not buying because of the yield….they’re buying to restore confidence…a different animal altogether, Was the Fed buying empty malls in 2009 because they needed to have empty malls in their portfolio?..
      Central bankers = buyers of last resort 😉

  12. My 2c is that wave structure is looking like it wants to form a wedge (say ED) for Major 5 and is targeting the 2198 pivot and P3=1.618*Pri1=2213 by June OPEX where;
    Wave A = 2120
    Wave B is ongoing and targeting 0.50 to 0.666 retrace of Wave A

  13. nardobeme says:

    Per my PMO indicator, SPX and NDQ should go to a buy shortly. Small/Mid-caps went to a buy about 30 min. ago. Shall see…

  14. torehund says:

    Biotech may do an afternoon rally, doesnt seem to be hindered much by the rising greenback🙂

  15. ashram says:

    Over the last two years, SPX has usually found support in the vicinity of the 121 day sma:$SPX&p=D&yr=2&mn=0&dy=0&id=p75119036754&listNum=70&a=397949028

  16. torehund says:

    Market has tackled the modest dollar rise, but With such a strong rally markets succumb. My prediction of 10,4 nok to the dollar seems to be o track. Just a half a year or so it was just 5,8 nok to one dollar. Deflationary for the US.

  17. For baby bears there’s a gap at 2046.74. For mommy bears there’s a gap at 2041.51 and for you daddy bears out there there’s a gap at 2020.85.

    • I don’t have much conviction when I count this decline. Today’s lows count equally well as a complete abc as they do as 3 of 3 of only wave a. INDU, SPX & NDX all much the same. What I would say is if the market ends at or near its lows for the day then I’d expect a spanking rally tomorrow whatever the count.

  18. kvilia says:

    I’m concerned with MACD on SPX monthly. It may indicate the top of PIII or almost the top. I will make an attempt to add to my longs tomorrow or day after watching carefully 2019. If it breaks, I’ll take a small loss and consider going short to ride the PIV. If 2019 holds, there could still be the room to get to 2150-2200 on SPX to complete PIII. That’s my game plan, and I have been long for a few weeks now with just a minor gain after today’s close.

  19. bhuggs52 says:

    Stopped out my UPOA. Maybe we fib at 50%, or we’re on the Matterhorn at Disney with the big drop to come and the measles nearby.

  20. GYN LAB says:

    My buy order 2052 missed by less than a point… such is life! Now not sure if there would be OML or I would need to get in at .618 at 2056…

  21. gtoptions says:

    Thanks Tony
    SPY ~ Bounce at WS3 @ 205.82
    Potential Symmetry set up chart.
    GL All

  22. fotis2 says:

    Apologies in advance for this not being trade related but what you guys think of Apple Watch? I’ve already got visions of China made fakes flooding the market at $3.99.I’ve seen a lot of useless crap but this one takes the cake!

  23. bhuggs52 says:

    I’m like Simple, toes in, small long position UPRO with a tight stop. Think a good bounce possible, maybe even a bottom. GLTA.

  24. stephenk1980 says:

    I grew some larger cahunas and shorted from yesterday’s high. Taken profit now as although I believe P4 is just around the corner with interest rates about to rise and bond yields taking off, never mind Greece’s potential eurozone exit which seems so nicely timed with the Euro approaching a low (Greece out and Euro is going to appreciate as one fewer weak country), I just can’t see a top just yet and Europe is not tanking like it would if this was the ‘end’.

    • Looks like the 11:00 Buy the dip crowd is hear. If they can push it . more power to them, if not this afternoon and tomorrow will lead to a 60 point sell off. Just my opinion

    • sloop says:

      keep on growing them Stephen, you will know they are fully grown when you post the trades pre and not post-fact gl

      • stephenk1980 says:

        I mentioned yesterday that I exited my longs as the retrace was topping. I also then said that I wasn’t sure I had the balls to go in short at that point. In the end, I did.

        Today I followed up to confirm I went short and explain why I’m now out.

        I think that’s enough detail on my activity.

        For the record, I don’t think it’s the bottom just yet, but I’m out because profit vs capital on my trade was of too high a ratio hence I cashed my chips, so to speak. Personally I’m with Sibyn on this as far as I think 2034 is not an unrealistic target for SPX. After that though, I think we’re going for a new high. Dow might only have another 100 points in it though, which, if it leads, means SPX might not get that far.

        If we do break 1980 though it’s P4 for sure IMO, but I don’t think (and I hope) that it’s not this leg down that’s going to do it.

  25. uncle10 says:

    Hey Mr. T. turns out Naz 5000 was resistance….
    Sometimes it seems so easy, and other times so difficult. Such is life I reckon.

  26. travis01 says:

    TC, funny how all the rampant bulls of last week who posted about those crazy quiet bears in hibernation have all decided differently now. I get a kick out of the comments by some. Wonder if they know you can trade both ways? 🙂

    • fotis2 says:

      You shouldn’t believe everything posted on this site as the saying goes ‘Believe only half of what you see and nothing that you hear 😉

    • sloop says:

      by the sound of it they indeed know more about it than maybe you travis

      • travis01 says:

        Why? Because I went short for the entire drop while listening to the incessant daily “omg those stupid bears are a hiding boy…look at us we riding the wave to 2200 no doubt”. There are some fairly smart folks here that trade both up and down. Some are even capable of doing both day trades and long term…crazy huh?

  27. mjtplayer says:

    Spot VIX only in the mid 16’s, in line with the March contract. But, both spot and March contract are 10% below the April contract – no fear/panic yet.

    Would like to see spot VIX trade in a flat curve at least, we may not get to backwardation but the spot should at least rally up to flatten the curve the 18-ish area.

  28. ashram says:

    SPX could not get above 2085, so the corrective bullish scenario remains in effect:: a pullback followed by a resumption of the uptrend. The market is now at oversold levels consistent with the trading lows of the last twp years. After a false breakout, it is safer to buy a momentum reversal rather than purchasing support because these shakeouts can be vicious.

  29. GYN LAB says:

    c=1.618*a at 2052, also .500 retrace of 1981-2120
    maybe a small bounce at open then OML at 2052 to buy..

  30. blackjak100 says:

    Looks like we will absolutely get the 60min +div at the open. I’m a buyer @ 2060ish, for at least a decent bounce, as we should be deeply oversold. Soul mentioned the NYMO closing below lower BB which has always been a great indicator. A proprietary indicator I use will also be deeply oversold probably more than Oct 2014 low. GL and Cheers!

  31. sibyn says:

    It can become storm warning today.

  32. fotis2 says:

    $/yen managed to break above the Dec7 high in afterhours trading not sure of a trade at these levels possible some profit taking for now a move back to the lower part of channel at 121.200 level best wait and take it from there.Light crude still no firecrackers.For SP i’m looking to trade the inside day.

  33. FTSE, SPX and INDU on sell as per my model. SPX should not break 2091 with impulse. No support till SPX 2025 now. There will be bounce from 2025

  34. The NYMO, having been in weak rally mode since the beginning of this year, has, by turning negative pulled the SI into a downtrend. I call the SI “the breadth filter persistence index” with the A-D being the source breadth index and the NYMO the “breadth filter index”. When the Summation Index goes into a deep downtrend, it takes some persistent positive A-D action to turn it around, much as an aircraft carrier or oil tanker takes time and distance to change course. If the SI arrests it’s downside momentum soon, it’s chart will just show a dip that made a higher low and then rose upward in fairly short order. If not, then we will be looking at the technical equivalent of an aircraft carrier making a wide turn as it reverses course. We will be looking at weeks instead of days until the correction ends.

  35. soulsurfer says:

    NYMO closed for 2nd day outside its lower BB; that’s quite rare. If history is any guide, it means a bottom is at hand/close

  36. Breath of the market was weak on NYSE and Nasdaq. Many more new lows than higns on the NYSE, Nasdaq about even on the new H/L. It seems we had a breather today. Looking for another leg down from here.

  37. bouraq says:

    Today’s charts:

  38. rabbittrader1 says:

    Based on your excellent work Tony ,and based on pattern recognition and World economic situation my (modified) estimate for the SPX is a gap opening either this week or next Monday; then nine weeks, generally up, into about MAY 10th or so (Bradley turn date) The target for the SPX would be 2200 plus. Expect further dropping in gold during this time ,to below $1,000. Sugar continues down ,as well as wheat. I remain long WTI crude and expect strong upward movement in this 4th wave upward correction to $65 in April (maybe $70. ) NO GUARANTEES. Rabbit.

  39. torehund says:

    Thanks Tony.
    Did a count on the Norwegian Crown and it is bottoming soon, maybe an abrupt 30 percent depreciations from here as is expected from the euro,( red extended candle. After that its pedal to the metal for this currency, and for commodities too🙂

  40. llerias7 says:

    Isn´t the upper spx 1950´s l (50% retrace and testing 50 DMA) the most probable bottom? I am counting on it!

  41. fotis2 says:

    Thanks Tony for now basically an Inside day lets see what tmrw brings GL all.

  42. GYN LAB says:

    Thanks Mr T! IMO still need to overcome that 2104 (.618 retrace at 2100) to start considering Minor 2 done, could clear 2085 yet still loop back down for OML

  43. simpleiam says:

    Thanks Tony! Me thinks we could use a gap up over 2085.

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