Tuesday update

SHORT TERM: gap down opening then rebound, DOW -28

Overnight the Asian markets lost 1.0%. Europe opened lower and lost 0.6%. US index futures were lower overnight, and the market gapped down to SPX 2105 at the open. The SPX had closed at 2112 yesterday. In the opening minutes the SPX made its low for the day at 2099, then began to rally. At 10am Factory orders were reported lower: -0.4% v +2.1%, and FED governor Brainard’s speech was released: http://www.federalreserve.gov/newsevents/speech/brainard20150602a.htm. The market continued to rally into the afternoon when it closed the opening gap and hit SPX 2118. Then it started to pullback again. At 3:30 the market hit 2109, then ticked up to close at 2110.

For the day the SPX/DOW were -0.15%, and the NDX/NAZ were -0.20%. Bonds lost 19 ticks, Crude rose $1.10, Gold added $5, and the USD declined. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2131 and 2198 pivots. Tomorrow: the ADP at 8:15, Trade deficit at 8:30, ISM services at 10am, then the FED’s Beige book at 2pm.

The market pulled back from 2119 resistance late yesterday afternoon, gapped down this morning into support at 2099, then rallied back to 2118 resistance again this afternoon. Another choppy day. However, we now have a decline, in the form of a flat, from the SPX 2135 high: 2099-2126-2099. Today’s rally to SPX 2118 may be all, or part, of a rebound before the market makes another a-b-c lower. As a result we continue to lean to the downside with an expected downtrend underway. Short term support remains at SPX 2096/2099 and the 2085 pivot, with resistance at SPX 2117/2122 and the 2131 pivot. Short term momentum touched oversold, rebounded, then ended the day under neutral. Best to your trading the Beige book!

MEDIUM TERM: uptrend appears to be rolling over

LONG TERM: bull market

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

About tony caldaro

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101 Responses to Tuesday update

  1. bob623 says:

    Just wondering if there is going to be a Wednesday Elliott Wave post from Tony?

  2. fotis2 says:

    After hours looks like a CH on the 30 both dips on trendline were bought today daily close CCI above 0 line suppose bullish tmrw

  3. Peter Sliney says:

    I’m starting to think that the $SPX will not roll over until the $NAZ reaches and exceeds it’s all time high which is 4816.35. (according to e-signal)
    Until then just a lot of sucker plays and bear traps.

  4. kvilia says:

    Divergencies… Just added to my short RUT position. Would not be surpised if closed red across the board.

  5. Gold just made a 12 dollar move down in 30 minutes.10 year up to 2.38 part of the reason.The main part is the failed breakout attempt monday.I thought that could be a catalyst for a big drop—which could be today if it breaks 1180.The gold trade may be done after that, except to the short side. (Caveat:if Fionas yield channel holds and reverses.) Critical moment indeed.

    • budfox9450 says:

      Actually, I am rather positive on GLD,
      so long as that base as $110 holds…Bud

    • mjtplayer says:

      Agree, spot $1,180 area is important support, but the uptrend line from the March lows has been broken, currently about $1,187


      • Of course we ve seen these false breakdowns and breakouts before…gold did it awhile back.If bonds yields have peaked gold could rally again.Not out of the question but Monday looked poor to me technically.Good luck all.

        • mjtplayer says:

          The Dollar has been tanking this week as the Euro shoots past 1.12

          With the Dollar dropping almost 3%, you’d think gold would catch a bid, but no dice

          I’m short GDX from about $19.90, small position and have been short for a while – it’s been boring. Looking to add though if GDX reaches the $20 area again

  6. GYN LAB says:

    Watching a possible H&S pattern here, with LS and head completing with RS up to 2117-8 (.618 of today’s decline from 2121-2110)

  7. fionamargaret says:

  8. ABchart says:

    European future plunged, Schaeuble does not like Greek proposals this morning. No quick deal for him. (greek press)

  9. H D says:

    SPX same prices all year, not a bad morning for scalpers, 2115, 2110, 2121, 2115 IDK if they can hold that 2094 ES globex low this week. JMHO

  10. uncle10 says:

    Thanks Mr. T.
    I’m sniffing around natty gas market thinking of fishing for a bottom around here. Lee or Darkness or anyone got any thoughts? thx

  11. mjtplayer says:

    I’d give anything for some volatility. This market, over the past few months, has been the most boring that I can recall. Absolutely no volatility to trade, SPX within 2% of 2,100 since mid-Feb.

    I have small positions in DUG and short GDX and have small trades in and out of VIX ETF’s, but that’s it, mostly cash now for months – soooooo boring! This sucks, untradeable market until we start getting larger moves.

    • H D says:

      Feb dip rallied 3%, March dip rallied 3%, April dip rallied 3%, May dip rallied 3%, June….

    • ABchart says:

      Draghi speech summary:

      – No QE exit discussion
      – No financial risk in EZ
      – No change of attitude about Greece
      – About higher volatility: “Get used to it!”

      Apparently, there are some institutionals who find that there is too much volatility.

  12. still inside the wedge, Could still be an ending diagonal and end any time

  13. magnus1234 says:

    Draghi: Booo…more volatility in bond markets….!

    I’ve been waiting for this moment for a long time 🙂

  14. gtoptions says:

    Thanks Tony
    Kudos again to Blackjak100.
    SPY/SPX still pointing to 2042/44, Possibly higher. IMO


    • stephenk1980 says:

      If it doesn’t reverse around 2128 then i agree. My backup scenario is a reversal around 2140 which would leave 2136 to 2096 as A of the B wave, 2096 to 2140 as the B wave and would then expect a C down to 2040ish.

  15. TARGET
    Close attention to FTR since rupture $ 5.22 asset will be able quickly get $ 5.30 in order for $ 5.42


  16. Page says:

    Looks like market liked ADP numbers, it will love the NFP numbers on Friday and on top of that CB’s will further fuel the markets around the world. VIX will collapse.

  17. stmro says:

    I can’t predict these markets anymore. Yesterday equities ended on a bearish note. Today, massive movements in yields suggesting risk-off. Yet all major indices are flying.

    Going to step aside until we spend a few days trading below 2000 or above 2135.

    • scottycj1 says:

      I posted a chart yesterday showing Tuesday was a low

    • zepfan123 says:

      Don’t feel bad..NOBODY is predicting the market short term with any clarity right now. All we know is we’re still in the same tight range on the SPX in the 2099 to 2025 area we’ve been in for a month or so- Obviously today looks like it might be a chance for that breakout above SPX 2030 and beyond to occur very soon. We’ll know very soon..by Friday or next Monday at the latest I’m sure.

      • stmro says:

        Yea this no man’s land is littered with the bodies of swing traders like me. Only people making money are the scalpers and options sellers.

        • fishonhook says:

          Look at Tonys 60 min S And P chart
          It’s a mess
          No one can count these CB shenanigans

    • JeffMilano says:

      ST, Atualy yestarday they finished on a bullish note, and felt today they would gap up. Two days ago the opposite. But what is inbteresting is that today they are staying strong. If Tomorrow is confirmid bullish then this is very positive.

  18. The dollar did a complete reversal down which the algos loved.UUP at 25.06 heading down to fill gaps at 24.70.Then it might reverse again and cause the algos to sell.A higher dollar is not what the bulls want…pretty obvious and quite a tightrope to walk.Just a one day wonder as far as I m thinking.

  19. Good call blackjack.

  20. ABchart says:

    Read this yesterday:

    What Will Happen to a Generation of Wall Street Traders Who Have Never Seen a Rate Hike?


  21. zepfan123 says:

    Well it looks to me like any chance of going into the red today is gone now. It looked possible just 15 minutes ago,but all of sudden all the key indexes.Dow,S&P,Tran,COMP,RUT,etc have gone crazy to the upside in unison so the markets guardian angels continue to keep a close watch.

  22. rc1269 says:

    whoever tried to gap us up today didn’t do a very good job

  23. ABchart says:

    ES: today (2109/2136) and tomorrow (2112/2135)


  24. DA Davidson upgraded Frontier Communications (NASDAQ:FTR) from Neutral to Buy with a price target of $6.50.


  25. This market is starting to remind me of my ex wife. Just won’t go down.

  26. JeffMilano says:

    AB, the mkts are ramping up, as you pointed out, perhaps the deal is IN. Great info from you. tx

    • ABchart says:

      Hello Jeff,
      They have no alternative, but I think it will take another two weeks before signing a serious agreement. This is because of the down leg next week on the indices.
      CAC and DAX is expected to rise by almost 2% more by next Tuesday (06/9), before a violent drop (only 2 sessions?) target the yesterday low. Then a big bullish wave from June 15 for 3 weeks.
      Everyone must be careful because the market is highly speculative these days 😉

  27. fotis2 says:

    Just broke above downtrend line AH suppose bears have got to get their act together otherwise new highs.

  28. @Tony,

    Indian Index Nifty Bounce from 7997 up to 8490, and now @8135,
    as you had mentioned 4th finished @7997, and 5th start, but it could be ‘A’@7997, ‘B’ @8490 or @8467, now how much tgt for NIfty??

    A=C tgt 7400
    or please find me more clue ??


  29. stephenk1980 says:

    Lower low coming this week imo then bounce to 2170+. Current rally wave 2 of the corrective downward wave.

  30. hkloon says:

    Somebody posted on stocktwits on GREK (greece), looks like going to breakout…
    RSI shows breakout to upside… it’s certainly may mean a deal has been reached…

    • torehund says:

      agree hkloon, GREK has been due for a long time, whichever way is positive for Greece, the real pain for them is to be in a stronghold without autonomously having the ability to going nowhere and do nothing.
      Maybe they will take a U-turn and invite Putin, in case of a success with the latter others may follow and Eu shrinks into nuttin… 🙂

      • torehund says:

        Deutche Mark/Euro was 0,6 to the Dollar before the EU really took off…So my 0,3 isn’t that far off if the Piigs and England Exits.

  31. My respects to you Tony C. I’m with you. My numerous indicators (price momentum and breadth) are almost all pointing to a lower SPX market soon. My trading account is only 10% stocks, with 90% cash. Wish me luck, and GL to all. Rick

  32. reddragonleo says:

    I rarely do many new posts anymore as I just daytrade and use the comment section on my latest post to update anyone following what I see from day to day. Then I retweet it. But I did a pretty important post of what I expect in the coming months last night and posted it today. If interested you can read it here…

    New RedDragonLeo Post: http://reddragonleo.com/2015/06/02/from-lindsey-williams-to-the-shemitah-many-signs-point-to-a-stock-market-crash-in-the-fall-of-2015/

    • kvilia says:

      Wow,,, that’s all I got to comment on this.

    • JeffMilano says:

      Red, I have subscribed and it very good. Thank you. I too think in the fall or after, but not now. Thank you

      • reddragonleo says:

        Yeah Jeff, certainly we should have a 4th of July rally… which if this coming week of June 15th-19th puts in a top and then the week after drops hard we could see either a lower high in early July or a slightly higher high. Just know know which at this point?

  33. Thanks Tony. While the past 10 months NFP weeks all saw 13 or more points down as the minimum downside from the previous week’s close, the 7 months before that showed 4 instances with numbers like today’s 8 down from the Friday close. So maybe the low today was enough for this pattern and a B wave with more chop can last until Friday.

    I’m expecting some significant downside next week though. April was the exception to the following pattern for post-NFP weeks that were on either side of a seasonal expiration (or change in season). Before April, the maximum down from the NFP day close was -31, -57, -73, -62, -28, -32, -23, -51, -38, -26 going back a bit more than a year. The weeks all closed down too until this past April.

    I tried to figure out where to take a loss on this pattern if I short on the close Friday or open Monday, and the most any of those weeks was up from the Friday close was 12 points (until April).

    I mentioned this here in April and then was chagrined when the pattern went bust, but if you sat these 8 post-NFP weeks out for the year up to April, and were otherwise long only, the gains would have been doubled or something ridiculous like that. In other words, those 8 weeks cumulatively lost as much as the rest of the year gained or something close.

    • Great stuff as always.They might have had an April exception, but you can t argue with something thats worked consistantly in a Fed controlled world.Much appreciated.

  34. blackjak100 says:

    The completed b wave triangle I mentioned this weekend was invalidated today. However, I still think we are in a triangle with c wave completing today at 2099. Looking for 2115-2120 (d wave) tomorrow before reversing towards to 2105ish to complete triangle probably thurs AM.

    There is absolutely nothing impulsive from 2135 indicating a reversal. Still think we can hit 2145/2165 by 6/9 bradley turn date
    GL and Cheers!

  35. astrofibo says:

    DJI Hourly… Time Ratio 161.8… Price Ratio 61.8…

  36. lolomatador says:

    Does anyone else see the potential rounding top trend reversal pattern or I’m I all alone here

    • budfox9450 says:

      Your not completely alone. I would call it a broadening top
      pattern. In that the $NYHGH, only reached what 51 yesterday,
      The big Bull market holder is the US Fed. So many are focused
      on the assumption the fed will not go negative….this year…
      And sure, that is a possibility.

  37. torehund says:

    Thanks Tony.
    Jelly Tore, keeping all possibilities open, but RUT medium and longer term monthly hock up is my lighthouse in the choppy seas.

  38. esvxm says:

    Thanks Tony for the analysis!

    German DAX and S&P 500 key patterns and levels to watch: http://marketchartpattern.com/indices/german-dax-and-sp-500-update-2-june-2015/

    EURUSD GBPUSD and AUDUSD key pattern formations and next key levels: http://marketchartpattern.com/forex/eurusd-gbpusd-and-audusd-key-levels-update-2-june-2015/

  39. nardobeme says:

    Nice market moves lately; has been very profitable for me. Good chance of breaking out of the current down channel to the upside tomorrow imo.

    • fishonhook says:

      Good chance of it going down too… No ?

    • CB says:

      truenardo, …they repeatedly keep taking the market down to support, and every time it find support, shorts or some over-exuberant souls run it up in a wedge-like fashion, as matador has repeatedly pointed out, after which they (the ones who provide “orderly” market) give the exuberant chasers hell (as they should, of course) and offer those shares to you at support at EOD. Nobody wants them then, of course…b/c being at support is so…ahem…”scary,” right?…or they’re fixated on 2040..or whatever..
      Wash, rinse , repeat.., gotta love the Greek negotiation process…let’s hope it continues for a while…and in the end, like you say…boom! 😉

  40. I m ready for lower prices…90% cash 10% gold.Fingers crossed as always.

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