weekend update


The market started the week at SPX 2081, gapped up on Monday/Tuesday hitting 2110, pulled back to 2091 by Wednesday, then with a gap up on Friday hit a new high at 2121. For the week the SPX/DOW gained 1.6%, the NDX/NAZ gained 3.8%, and the DJ World index gained 1.6%. Economic reports were sparse, and again biased to the upside. On the uptick: the FHFA, existing home sales, durable goods orders and the WLEI. On the downtick: new homes sales plus weekly jobless claims were higher. Next week will be highlighted by Q1 GDP, the FOMC meeting, and PCE prices.

LONG TERM: bull market

After making what we feel is an important Major wave 4 low at SPX 1981 in early February, the market confirmed an uptrend and made new highs at SPX 2120 by late February. After that the market spent the next two months in a choppy sideways pattern between SPX 2040 and 2115, until late this week. What is interesting is despite the sideways activity the market never once confirmed a downtrend. In other words, the uptrend that started in early February is still underway. More on this below.


We continue to label this bull market as Cycle wave [1] consisting of five Primary waves. Primary waves I and II completed in 2011, and Primary wave III has been underway since then. Primary I rose in five Major waves with a subdividing Major wave 1 and simple Major waves 3 and 5. Primary III is also rising in five Major waves, but Major 1 was simple, Major 3 subdivided quite a bit, and Major 5 is expected to subdivide as well. When Primary III concludes there will be a steep Primary IV correction, probably in 2016, then a rising Primary V to end the bull market, probably by 2017. Our target for Primary III remains SPX 2530-2630 by Q1/Q2 2016.

MEDIUM TERM: uptrend

After the market made new highs in late-February at SPX 2120 and started to pullback, we expected a small decline, about 5%, and then the uptrend to resume. After the market declined to SPX 2040 by early March, rallied to 2115 by mid March, and then declined to 2046/48 by late March we thought the pullback might be over. The rally off the SPX 2048 low started off well but then got quite choppy. This led us to believe that the market would need to retest the SPX 2040’s again, or worse case the 2019 pivot, before the pullback/correction ended. We even went so far as to post five potential counts to cover all possibilities, even though the two highest probability counts met the above support parameters. The market nonetheless chopped its way to new highs on Friday.


With the SPX/NAZ/NDX/NYSE/WLSH indices all making new uptrend highs, and the NYAD making new highs as well, it is time to find some sort of impulsive wave out of this months choppy activity. Since Major wave 4 ended in a failed flat: 1973-2094-1981, Minor wave 2 could have also ended in a failed flat: 2040-2115-2046. On Thursday we posted a potential count that was mentioned in our OEW group: a leading diagonal. This count, which was mentioned by Bill C., suggests a leading diagonal from SPX 2046: 2089-2048-2108-2083-2112. This could be labeled Minute i of Minor 3, and the pullback that followed to SPX 2072 Minute ii. After that Minute iii kicked off, and has thus far risen: 2110-2091-2121. This count would not only explain the choppy activity over the past month, but also suggests some explosive upside ahead. Medium term support is at the 2085 and 2070 pivots, with resistance at the 2131 and 2198 pivots.


After Thursday/Friday’s market activity we have dropped the three alternate counts we had only given a 10% probability. The two remaining: a Minor 1 high at SPX 2120 if the uptrend remains, and an Intermediate wave i high at SPX 2120 if we confirm a downtrend. Since the uptrend appears to be extending we are going with Minor wave 1 at SPX 2120, Minor wave 2 at SPX 2046, and Minor wave 3 underway. As long as the OEW 2070 pivot is not broken to the downside the uptrend should extend higher.


Should the OEW 2070 pivot be broken, then as the DOW charts suggests, at this point, this choppy activity is not over, and a downtrend will likely be underway next. This activity would then favor the Intermediate wave i count noted above. Should the market do move lower we still feel the downside is limited to the SPX 2040’s or worse case the 2019 pivot. Short term support is at SPX 2112/2115 and the 2085 pivot, with resistance at SPX 2121 and the 2131 pivot. Short term momentum ended the week with a negative divergence. Best to your trading this tough market.



The Asian markets were mostly higher for a net gain of 0.5%.

The European markets were all higher for a net gain of 1.6%.

The Commodity equity group were all high gaining 2.8%.

The DJ World index is still in an uptrend and gained 1.6%.


Bonds are still uptrending but lost 0.3% on the week.

Crude is also uptrending and lost 0.4% on the week.

Gold is still in an uptrend but lost 2.0% on the week.

The USD appears to be downtrending and lost 0.6% on the week.


Tuesday: Case-Shiller, Consumer confidence, and Senate testimony from FED director Van Der Weide. Wednesday: Q1 GDP (est. +0.75%), Pending home sales and the FOMC concludes. Thursday: weekly Jobless claims, Personal income/spending, PCE prices, the Chicago PMI, and a speech from FED governor Powell. Friday: ISM manufacturing, Construction spending, Consumer sentiment, and Auto sales. Best to your weekend and week!

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

About tony caldaro

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188 Responses to weekend update

  1. CB says:

    Tony, when you have a min, do you see an impulse down on the intraday chart today?..on 5 min. Thanks.

  2. H D says:

    This is SPX -10 handles, outside day, overlapped the 2109.64. ShaknBake™
    Bring on the FED gibberish.

  3. berniebaruch says:

    Saw Cramer for 2 minutes this morning at nine….Bullish….Couldn’t find anything to sell

  4. lunker1 says:

    Tony’s EMAs at 2102

  5. Looking at current numbers, I have the following:

    Long above 2129.34 Stop 2104.05
    Short below 2094.44 Stop 2116.16

    Air is getting awfully thin up here…

  6. johnnymagicmoney says:

    If you look at IWM there is a rising wedge and has been getting extra tight as of late. At the highs today (when the Russell was outperforming) it hit the top band of the wedge which also corresponded with the all time high. It then sold off dramitically and now is underperforming the market dramtically and unfortuntaely looks like it is going to close belows the wedge channel if that makese sense. That is not f-ing good…………….to me that is a bad bad sign

  7. fishonhook says:

    Charts starting to look a bit bearish time for them to turn it on a dime . Get a CB mouth piece out there, or send more money to the traders on WS , anything to whip it up quickly.

  8. stephenk1980 says:

    And today was the intermediary peak. See you back down at 1980 odd.

  9. Newbie – please answer
    Darkness (@SirDarkness) says:
    April 27, 2015 at 1:20 pm
    Newbie –
    Could you please explain what you mean your comment below ???

    Darkness, you already know paper is a couple hundred to 1.

    Where did you purchase your physical gold & Silver ???

  10. mjtplayer says:

    Darkness, it will take time. IF, and that’s a big if, GDX breaks the neckline – then yes, downside target is $12. That said, it will not go straight there, it will take months and there will be testing upon testing of the neckline.

    Newbietrader – the GDX is not gold.

    Top 5 GDX holdings representing 31% of the GDX and their respective 12mo forward P/E ratios:

    GG: 32x
    ABX: 23x
    NEM: 20x
    NCM: 23x
    GOLD: 30x

    Average P/E: 25.6x 2015 expected earnings.

    Yes, if gold goes higher, they will make more money and possibly be more reasonably valued. If gold just stays where it is, there companies are roughly 70% overvalued – assuming they trade at 15x earnings. If gold goes down and they make less money (or begin losing money), they become crazy overvalued.

    Also, these are the “ex-items” numbers; the real numbers are far worse.

  11. lunker1 says:

    5 up from 2072?
    Or is today w4?

  12. torehund says:


    ..dont chicken out its just BTK correction playing itself out and hurting the RUT:

  13. if this is minute 3 of minor 3 we shouldn’t drop below 2010 right or at least not drop below 2000 that would be a 26 point pull back. Minute 2 was only 20 points. ?

  14. fotis2 says:

    So far the break is to the short side potential target 2106.

  15. I wanted to post a synopsis as to why at this juncture we need to look closer under the microscope as to what is happening in the market. Unfortunate I was not able to as I came down with “seasonality” allergy and was too weak to write. I did manage to put together a could of charts that IMO could hint at the next target for the upcoming potential top of whatever significant degree and if May shows us it’s true historical color I’m think P3 top is coming soon.

    Possibility 1: http://tos.mx/1jT6dB
    Possibility 2: http://tos.mx/7sBR5P

    May historically is responsible for starting or setting up many of the market corrections and/or larger pullbacks. I’m betting that history will have it’s way once again.

    On Friday I mentioned that 3 stocks were responsible for all of NDX’s gain. Well it goes further then that. MSFT (#2), GOOG (#3) and AMZN (#4) combined for 70 pts yet NDX only managed 59 pts. These three beast combined only have a 18.2% influence in the NDX just slight more than APPL solo 14.5%. Today Appl alone nearly responsible for all of NDX’s gains. New leaders must emerge fast if Mr. Market is going to extend P3 as beyond 2198 Pivot.

    The great Jessie Livermore, Joseph P. Kennedy, Bernard Baruch use to describe market manipulation by the insiders such as Rockefeller, JPMorgan, etc as creating excitement for the entire market by dramatically spiking the prices of a few key stocks while they unloaded their other stocks into the market…..This is how I’ve have been seeing it for past few months now and has only gotten worst.

  16. H D says:

    +(55) ish from opex low, there’s fib clusters 2121- 2138.
    Should be no problem for a iii of 3 up though……

  17. Crash imminent and Brewers for the Series ….

  18. IWM lost 8 points in 10 minutes…talk about resistance.

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