Monday update

SHORT TERM: Greek No-vote creates gap down opening, DOW -47

Overnight US index futures gapped down about 30 points to start trading, dipped lower, and then started to recover just like last Sunday night. Asian markets opened lower and lost 1.9%. European markets opened lower and lost 1.7%. The US market opened at SPX 2062, dipped to 2058, and then started to rally. The SPX had closed at 2077 on Thursday. At 10am ISM services was reported higher: 56.0 v 55.7. The rally continued until about 10:30 when the SPX completely closed the gap down and hit 2079. After that the market started to pullback. The pullback took the SPX back to 2060. Then a rally into the close ended the day at SPX 2069.

For the day the SPX/DOW were -0.30%, and the NDX/NAZ were -0.35%. Bonds gained 24 ticks, Crude plunged $4.10, Gold added $3, and the USD was higher. Medium term support drops back to the 2019 and 1973 pivots, with resistance at the 2070 and 2085 pivots. Tomorrow: Consumer credit at 3pm.

The market gapped down at the open today for the fifth consecutive gap opening in the past five trading days. Then after coming within 2 points of last week’s SPX 2056 low the market rallied to 2079 closing the opening gap. After that the market headed down to SPX 2060, then bounced higher for the rest of the day. From the recent Minor wave B high at SPX 2130, Minor C has been subdividing into three Minute waves. Minute A was a seven wave zigzag to SPX 2056. Minute B did end right at the SPX 2085 pivot on Thursday. Minute wave C began right after the open Thursday morning. Thus far from SPX 2085 we have: 2056-2079-2060-2069 The decline to SPX 2056 can be counted as a small a, the rally to 2079 as a small b, and now possibly a 5 wave small c is underway. This suggests we could see a downtrend low quite soon. We continue to target the low SPX 2040’s or the 2019 pivot. Short term support is at SPX 2056 and SPX 2040, with resistance at the 2070 and 2085 pivots. Short term momentum ended the day at neutral. Best to your trading this volatile market!

MEDIUM TERM: downtrend

LONG TERM: bull market


About tony caldaro

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170 Responses to Monday update

  1. Dex T says:

    I wonder who’s buying? I’ve checked the “news” but haven’t seen anything that could be attributed to it?

    The ECB has cut Greece off and they are going to default. Everything else seems the same as yesterday

    Anything exciting I missed?

  2. lunker1 says:

    If this is INT 3 perhaps a gap above 2092 tomorrow

  3. What a rip roaring rally! Either Int. 3 has begun or this is fools gold?

  4. blackjak100 says:

    Let’s put this ramp job into perspective…NYAD at +210, NYSE up .22%, and NAZ flat on the day. The bottom at 2044 didn’t look anything like a bottom and the internals are suggesting nothing more than a countertrend rally. I suspect this is wave ii from 2130 targeting 2090ish as an expanded flat. I think the right play is to short this bounce, but I’m waiting for a break above 2085 myself.

    • Dex T says:

      It’s very possible.

      If 2130 was “the top” then technically we could have begun the bear market and the nature of the market could change-where we see sharp rallies off oversold conditions prior to reaching new lows.

  5. Peter Sliney says:

    You can never get comfortable or walk away from a position. I got clipped half my profits today fixing myself cereal and looking at the local paper.

  6. fishonhook says:

    Wow who would have guessed a 300 point swing in the Indu. Must have caught a lot of people off guard. Sure did with me.

  7. GYN LAB says:

    Looks reasonable to declare the int ii low in.. I was waiting for OML at 2039 that didn’t come… Now I will wait for .618 pullback around 2058 (assuming the 2081 local top for this 5 waves off 2044) to go in long

  8. mjtplayer says:

    Wow, so much for the 3 drives pattern, that was just busted on this 20pt SPX ramp up to 2,081 in the last :45min

  9. stmro says:

    Speechless. A few more pts and we’ll have done a 40 point round trip from AH high to low.

  10. fotis2 says:

    I really doubt anyone saw that move up the price was ready to bellyup a daily close bellow 200ma would of been shorted for the next support level but hey that’s trading look, learn and adjust accordingly no 2 days are the same.

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