Thursday update

SHORT TERM: drift higher continues, DOW unchanged

Overnight the Asian markets were mixed. Europe opened lower but gained 0.2%. US index futures were lower overnight, and at 8:30 weekly Jobless claims were reported higher: 274k v 264k. The market opened three points below yesterday’s SPX 2126 close, then began to rally. At 10am Existing home sales were reported lower: 5.04mn v 5.19mn, the Philly FED was reported lower: 6.7 v 7.5, but Leading indicators were reported higher: +0.7% v +0.2%. At 12:30 the SPX hit 2133, then pulled back to 2129 by 2pm. At 2pm FED vice chair Fischer’s speech was released: The market then remained in that range until the last hour of trading when it hit SPX 2134. Then a pullback into the close ended the day at SPX 2131.

For the day the SPX/DOW were +0.15%, and the NDX/NAZ were +0.45%. Bonds gained 14 ticks, Crude rallied $1.65, Gold dropped $4, 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 CPI at 8:30, and a speech from FED chair Yellen at 1pm.

The market opened at yesterday’s low today, SPX 2123, but that again was the low for the day. After the opening the market rallied to SPX 2133, pulled back, then hit 2134 in the last hour of trading. Today’s pullback, from yesterday’s SPX 2135, found support at 2123. This is the fourth wave of the advance from 2086: 2110-2096-2133-2123-2135. With the market closing close to the SPX 2135 all time high, there is a possibility for the first impulse wave unfolding since February: 2118-2086-2135-2123-xxxx. Inflection point continues. Short term support now at SPX 2118/2123 and SPX 2110, with resistance at the 2131 and 2198 pivots. Short term momentum remained around neutral most of the day. Best to your pre-holiday trading!

MEDIUM TERM: still an uptrend

LONG TERM: bull market


About tony caldaro

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71 Responses to Thursday update

  1. H D says:

    Have a great Memorial weekend Tony and all. USA!

  2. No denying that 2015 thus far has been like riding a

    • zepfan123 says:

      The Dow hasn’t done this since it started a 120 years ago 100 years: Technician
      Amanda Diaz | @CNBCDiaz
      23 Hours Ago
      “If this trendless trend holds till the end of the quarter,” technical analyst Jonathan Krinsky says…”it will mark the narrowest first-half trading range in the history of the Dow, which dates back to 1896.”

  3. Jack Zhu says:

    Will add any dips on ASHR, it’s on the way to 100 level.

  4. scottycj1 says:

    The Dow is down on the week……if it stays down here or below it will make last week the closing high so far. 324 weeks from the low……

  5. torehund says:

    And it might just be that the relationship SSEC, USD, BioTech UP, Crude down might restore itself once more, but a bit early yet.
    Concerning the Greek situation, I think the Greeks hope for the rescue efforts to end sooner rather than later. Its just money bypassing Greece going from IMF right to the Euro banks. Just another bank bailout effort prolonging the suffering.

  6. Seems to me that when a system (such as Dow Theory, Hindenberg, January effect) gets dismissed and ignored by most–it tends to come back with a vengence.My point of view is that they are warning signals, not to predict an Iimmediate crash but telling investors to not be all.I ve heeded the warnings over the years and saved over $100,000 because I did.Because of that I was able to retire early(happily).
    In the meantime a good relaxing weekend to Mr C and all.

    • meant to type…not to predict an immediate crash but telling investors to not be all in.Need a bigger keyboard(and screen)…lol.

    • If this was a true market, those would be concerns. Since its more of a Pyramid scheme for the last six years there not. No fear in the markets what so ever, no correction greater then 10 percent. CB around the world handing out free money. Just buy the dips and ride it up. It really is that easy. It will get you a 20 percent return in the next 12 months. New highs on the way today. buy this dip as well

    • LML25, you are correct it does come back with a vengeance. But one of the main reasons for this, is the fact that traders tend to cherry pick the data points to prove their point of view. For example, IMO, the Dow Theory, per the article that BlackJack posted below, did not fail, as a matter of fact it was successful. From EW perspective, DJT (Inter 1 of Major 5 of P3 of SC1 experience a blow-off top prior to SPX’s; therefore, SPX has some unfinished business the next 10 months to complete it’s Inter 1 wave. What you will notice is that both DJT and SPX Inter 2 wave bottomed at nearly the same time and both did enter a “bear market” (DJT declined 45.6% and SPX decline 20.3%). Hence it can be argument that the aforementioned behavior seems to share some behavior resemblance to what is happening right now.

  7. Some are not afraid to face a bull head on

    • tommyboys says:

      You win the bet Matador…doubt we move 700 pts this afternoon! Original post was end of May so we’ll see what next week brings. Still bullish regardless and see at least 10-15% higher by eoy. Unc hope you got a piece of at least one of the two – some free money there. Anyway cheers for a great weekend all.

  8. torehund says:

    SSEC—broke out 6000 next.

  9. blackjak100 says:

    S&P clinging to uptrend line from 2068 which sits around 2129ish as I write this. No break with authority yet.

  10. Thanks TC; best to you and yours and a good (holiday) weekend to all here.
    Still long at this point but keeping an eye on the VIX. Goal is now at 2157 for exit; we shall see…
    System long from May 14 with SPX entry above 2116.39 (hedged) target 2157
    Buy above 2144.42 with Stop 2122.47
    Sell below 2109.35 with Stop 2131.25

  11. gtoptions says:

    Thanks Tony ~ Enjoy your Memorial Day!
    Looks like that illusive impulse may just confirm today. 😉
    GL & Good Memorial Weekend All.

  12. simpleiam says:

    I’m not really good at wave counting, so glad that Tony is! I’m good with, and a big believer in fibs/retracements.

    To: Financial Reporting Blog – How much money have you made so far this year? Have you made any money for anyone on this board? Next time you decide to bad-mouth me, you need to remember this list, then, ask the posters here who’s made them money, you or me? Next time anyone decides to bad-mouth anyone here, the ultimate revenge for the person being bad-mouthed is to make sure everyone else on the board makes money from your picks, so here you are.

    Bulls: ANN, FLY, MOMO, OSUR (popping right now), PBMD, TTWO, AVEO, IPCI, JRJC, QSII, and new as of a couple of minutes ago, EROC. Those of you astute to formations will recognize these formations. If you don’t know what they are, then you need to learn.

    Bears: Nothing on the list for now, mostly because I’m only working the bullish side.

    Thought I’d leave you all with this very profitable parting gift, as I’ll be off doing other things, hopefully for quite a long time. GL everyone and remember our Vets! God Bless The United States of America!!!!!!

  13. kvilia says:

    Have a great Memorial weekend, Tony and all.
    We will reconvene@300 points lower on Tuesday 😉

  14. simpleiam says:

    TO: TOREHUND – PBMD. Hope it hasn’t popped again before you get this msg. GL!

  15. JeffMilano says:

    Tony and all and Jim D.C. have a great 3 day weekend and a great Holiday. Here in Milan we have a holliday from may 1 2015 to oct 28, 2015. There is the EXPO. Milan has been redone, many of the Piazza’s have been redone and look great. So come over and have fun. If newbie comes over, we have an expresso. Tony, if you decide to take a break from your hard work, well Milan is close to everything, after the EXPO you can go to venice, rome, and even switzland. And Jim if you come we can have lunch or dinner. Milan, the place to be this year. Have a great Holiday all.

    • tony caldaro says:

      grazie Jeff

    • ABchart says:

      Thanks Jeff!

      • JeffMilano says:

        AB, I value your opinion very, very much. You are Always on the mark. I see lots people from France in Milan especialy for the EXPO. One of my best friend is from Nizza, North of Monte Carlo, Olivier. If you do come and I am in Italy, since I travel quite a bit. Please drop me a note at

        • ABchart says:

          I’m flattered Jeff. Unfortunately my English is still not good enough to express more opinions. I also read your messages and those of many contributors, with great attention, and I appreciate.
          I do not plan to go to Italy immediately, but I often visit my parents who lives in Nyon (Switzerland) and I would not hesitate to contact you (I noted your email). In any case I like italian cuisine and art of living and it’s a country I visit all the time since my childhood.
          Thank you again!

  16. blackjak100 says:

    Let’s all put the Trannies divergence to bed although it is quite stunning actually. S&P has ripped 25% higher without a DJT confirmation before ala 1992. GL & Cheers!

    • stmro says:

      “Dow Theory is a sure fire system for depriving the investor of the first third and last third of every major move, and sometimes there isn’t any middle third”.

      I’m pretty sure there are very few long-term investors here. Ignore Dow Theory – it doesn’t help people in the here and now. In fact, if you look at long-term trends, DJI and DJT can remain diverged for many more months before converging again.

      What matters right now is Tony’s 2131 pivot on the upside and 2112ish on the downside. Conviction break and hold above/below these levels might be good entries long or short. Also watch Europe. If Dax continues to remain above its 50d MA, odds are good for a bullish resolution in S&P. If Dax can break and close significantly below its 50d MA TODAY (around 11835, but really need to see a close below 11750) and create a weekly hammer, odds start favouring a break 0f 2112 on S&P.

    • Interesting that they both corrected approx 20% from July to oct of 1990.

  17. pramod5483 says:

    look like we are heading for another high. my spx analysis at

  18. ABchart says:


    It may be the last spike: SPX +/-2150, DAX +/-12000, CAC +/-5200, before correction of 15/20% 🙂

  19. John Bell says:

    we are now entering the sweet spot or heart of the stock buyback period as the earnings buyback blackout window is done for almost all companies. So with lighter volume and plenty of buybacks for the large companies I would expect stocks to drift gradually up for the next several weeks.

    Earlier I think we started into the buyback period but before the holiday i suspect many executives were selling into the buybacks. So prices staggered and fell sometimes.

    I do not see a real strong surge but rather a gradual melt up that may have been forming the last few days. And add the strength period around Memorial Day holiday period. 2164 is the monthly R2 pivot for May and we usually do not go much above that in a month. So 2164++ is the possibly limit in May for the bulls. 2200 would be a stretch.

    Buyback strength period would be starting this week to about July 4 period. The with FED meeting June 17, I would expect a fear/uncertainty pull back before that meeting.

    If FED raises rates June 17 all bets are off on my analysis.

    Adding some market power may be that ECB decided to front load their EQE and then it will naturally taper off. Any smart person could see that ECB was going to be faced with a forced taper by the end of the year or earlier for sure. The ECB plan worked for a few weeks and then fell flat so they had to say something publicity to try to inject their markets with confidence., Draghi being the ever politician – great talker and not so good for execution of promises. And the total amount of EQE will be less than forecast. Shocker…..

    trading. I am long SPY and QQQ as long as we continue in a melt up that gradually pushes through this recent resistance ceiling. But the week before FED meeting June 17 could be tough one.

  20. fionamargaret says:
    • fishonhook says:

      correction… what’s that? Seem to remember hearing that word before.

      negative divergence, ending diagonal, counts and other the TA suggesting at least some sort of correction about to go into the shredder.

      My few VVX calls are down to a few cents after todays destruction.

      Hope newbie is doing ok.

      • Yep, 2070 by next Friday. We may never see 2100 for a year. Unreal how market overlooks everything. Is what is.mgood luck all. Have a great 3 day weekend. Yellen speaks tomorrow. Anyone looking for last minute cash for the weekend, buy any dips. Dow up 100 tomorrow.

      • bhupal777 says:

        The whole blog is about predictions or chart patterns recognitions. That is only 10% of the traders equation. There is no way newbie is going to get benefit or survive by coming to this blog.

      • Newbie, Newbie not a word from your mouth
        The S&P has gone north and the vix has gone south

        You need to be flexable and that is no joke
        If you keep up this crap you will certanly go brok

    • ABchart says:

      Nice chart. Thanks Fiona 😉

  21. blackjak100 says:

    I was wrong earlier, the uptrend line from 2068 sits at about 2128. Hopefully it drifts higher in extremely light volume right out of gate as I plan on closing SPY long no matter what tomorrow. The Wilshire 5000 has still not hit the upper trendline of its ED so maybe it’s possible. Again, not a requirement or rule. It would be odd for a sell off to begin tomorrow which should happen if trendline is broken.

    • mjtplayer says:

      I’ve been watching that too, W5K upper TL stands around 22,600, another 0.5% higher.

    • Buncha things saying a gap or short run to ATHs in the morning could lead to a sell off. Bradley on Saturday, Sunday or Monday (or two of the three), and Bradleys at extremes (like ATHs) have been the ones that worked since December. There is a Demark SSU perfected today (see Fil Zucchi on Twitter for that). And Mercury is in Retrograde as of 5/19. So maybe even just an ATH in futures would do, and a sell off for a few days through, say, next Friday, would make sense.

  22. 56rambler says:

    Mr Caldaro,
    If your alternate scenario is correct (impulsive wave ii), then what is your estimate for the next downtrend (in terms of points and time)?


  23. The Put/Call ratio $CPC did record a spike last week of 1.24. That indicator is the one that should be used for contrary opinion, not the VIX.

      • arthurk says:

        That was an error in my books. Both CPC amd CPCI are calced with VIX puts and calls included, spike was due to 10x normal reported VIX calls (equal to half of all calls in CPC, probably an error). I am now in process of recalcing CPC and CPCI back to 2006 backing out VIX. When you think of it high equity calls are a contrary sell, but high VIX calls are a buy. So inclusion of VIX since 2006 has distorted CPC and CPCI.

  24. pooch77 says:

    Still looking at 2140 as a high tomorrow than a pullback to Tonys 2 pivots

  25. fotis2 says:

    Thanks Tony tricky one bounced of just bellow 100 on daily CCI would like to see at least one daily close bellow 100 for a comfortable short.

  26. CB says:

    interesting action…all we can say is that there is going to be some drama soon….not sure which way, though 😉

    • agree CB, tension are growing have a look

      • CB says:

        LOL…Now that’s a lot of drama, you’re right matador…. Hey, that’s a good cartoon, but that sort of behavior looks like a fine mess, doesn’t it?… and here are the usual ingredients: controlling behavior(?) usually related to some fear of abandonment(?) and all that “stuff” being wrapped up in a strong passive aggressive package, where the controlling person won’t simply tell you what they want, but their behavior is constantly screaming: ” why can’t you simply read my mind” & “it’s always your fault “…..Drama, anyone?…Folks like that can really wear you out pretty fast…
        Hey matador, that was funny & educational. Thanks 🙂 Market drama is a little better..and it pays..

  27. mjtplayer says:

    Thanks tony!

    VIX and VIX futures were absolutely smashed today, looked more like a Friday VIX smash than a Thursday. Spot VIX has a chance tomorrow to trade down into the 11’s for the first time since Dec. Uber complacency, absolutely no fear (put buying)….

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