Tuesday update

SHORT TERM: gap up opening fails, DOW -205

Overnight the Asian market were still lower -0.8%. Europe opened higher and rebounded +3.9%. US index futures were much higher overnight. At 9am Case-Shiller was reported higher: +5.0% v +4.9%, and FHFA housing prices were higher: +0.2% v +0.4%. The market gapped up at the opening to SPX 1928, then continued higher to 1941 just past 10am. The market had closed at SPX 1893 yesterday. At 10am New home sales were reported higher: 507k v 482k, and Consumer confidence was reported higher: 101.5 v 90.9. After a pullback to SPX 1926 by 10:30 the market rallied to 1948 by 11:30, then started to pullback. The market declined to SPX 1915 by 1:30. Then after a rally to 1930 just before 3pm, the market dropped 3% in the last hour of trading to SPX 1867, yesterday’s low, and closed at 1868.

For the day the SPX/DOW were -1.30%, and the NDX/NAZ were -0.50%. Bonds lost 25 ticks, Crude gained 65 cents, Gold dropped $13, and the USD was higher. Medium term support is now at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Tomorrow: Durable goods at 8:30.

The market gapped up at the open for the first time since August 10th. In between those two gap up openings, were seven gap down openings in ten trading days. Quite an onslaught of overnight selling. Today’s market activity continued the feeding frenzy in the index futures. While the market did rally quite a bit from yesterday’s opening minutes low at SPX 1867. It was still quite a bit below Friday’s close at SPX 1971. And at the end of the day the market was back to that low.

The updated count, as noted yesterday, suggests the SPX is in Major C of Primary IV. Major A having occurred in July at SPX 2044, and Major B also in July at SPX 2133. Support for Major C should occur between the OEW 1828-1841-1869 pivots. Thus far it appears Intermediate A declined to SPX 2052, Int. B rallied to SPX 2103, and Int. C is still underway. Within Int. C we are counting Monday’s SPX 1867 low as Minor A, and the rally to SPX 1954 as Minor B, with Minor C already retesting the lows. Once Minor C concludes it should end Primary wave IV. Short term support is at the 1841 and 1828 pivots, with resistance at the 1869 and 1901 pivots. Short term momentum only managed to get back to neutral then ended the day quite oversold. Best to your trading!

MEDIUM TERM: downtrend

LONG TERM: bullish

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

About tony caldaro

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323 Responses to Tuesday update

  1. fotis2 says:

    3up 3down 3up on 30min but not good at waves.

  2. Dex T says:

    These huge price swings continue to look more and more like a bear market.

  3. 1950 short the close?

  4. Gary Lewis says:

    Well, I bought some calls at 190 (SPY) but on the hourly chart, it still looks just like some sideways consolidation. In the end, I’m well positioned to the upside and the downside. As long as volatility remains high, I’m make some money. Still looking for lower prices But I’ve been disappointed too many times in the past. As long as it goes up AND down, I’m a happy trader. I hate one way markets.

  5. nardobeme says:

    I’ll say this, Sibyn should receive credit for his projection. He called the 1830’s months in advance with his BART. Everyone thought he was bonkers. Sibyn recently suggested a quick jaunt to 210 (?). Sibyn, are you around?

  6. vorfahrt says:

    OMG Tony is unbelievable!!! The best of the best showing us the +div and green P IV while everyone and their grandma was still scared crapless. Talk about genius timing! Thanks so much!

  7. Rejected right at the top of the 1929 pivot

  8. cmucha68 says:

    2100 within 9 trading days.

  9. H D says:

    Just trade the pivots and fibs fellas. Have a great! much thanks Tony

    • perversionofthemean says:

      HD, I understand trading the fibs, but take a look at TC’s hourly SPX chart, overlaid with pivots. They’ve provided no support nor resistance. Humbly, I ask, am I missing something?
      To me, horizontal support/resistance works occasionally, but little trading is linear in this fractal market. Markets move from one parabola to another (waves of varying magnitude), and only a first-derivative on them is generally linear.

      • H D says:

        big words. I have friends that trade the big words and mechanical set ups. If you can’t look at the last 24 hours of SPX and see 134+ handles of pure pivotry™ then it’s prolly not for you. we closed 1869P rallied all night, 1929P sold of 34, rallied to 1901P and …… It’s enough to pay off your house. Trust me.

        • perversionofthemean says:

          Sorry for the big words. I teach high school math. Hazard of the occupation.
          I’ve attached a chart overlaying TC’s pivots on the SPX. I took the pivots of his that you mentioned above, and colored the lines to help them stand out. You can’t mention just the ones that “worked”, of course. As a trader with 22-years of experience, I still can’t see how you can trade around a price point that gets whipped seven times. I’m not saying others can’t; I just don’t see it. I also don’t see how using the 1869 pivot yesterday to take a position afforded any overnight peace-of-mind. With many considering yesterday the end of a 4th up and the beginning of a 5th down, it wouldn’t be prudent for a SPY trader to go long (it’s why I trade the ES and can participate after hours).
          As for Fib math, I understand, and use for measured-moves.
          On the chart bottom, I have the speed of the SPX plotted. I look for reversals in speed…

          • H D says:

            perv, I have so much respect for teachers! kudos. I’m an open book. I will help you any way I can. Your chart is excellent. If you can find any other signal that did better than the gross from pivots I’d be shocked. On your chart ‘no pivot here’ on Tuesday and Wednesday, both of the hits were exactly 34 points. I use the sequence and the retracement ratios. Hope that helps.

            I’ll be gone for a while but wanted to reply to you specifically. GL

          • Perv, HD sounds much more competent than I in this realm, but I would, on a basic level, suggest seeing pivots as a range around a center line, rather than a hard fast s/r price.

            • perversionofthemean says:

              Thanks BN. TC teaches something along the lines that there’s a +/- 7 points around them. I get it; it’s nearly impossible to nail the tick. Still, I’d hate to bank on a pivot holding, and then wait 7 points to be proven wrong, stop myself, see it then cross back above the pivot, think the pivot held, go long again, and then see it fall through as I await another 7 point fudge-factor.
              I’m not saying others are wrong; I’m admitting incompetence with TC’s pivots. I humbly have to stick with mine, unless someone can show me how to use them correctly. (#dense)

          • Well again, HD sounds like he’s got a lot more insight if he’s paying his mortgage with these pivots, but for what it’s worth, a reminder that for most things in the trading world, what happens at the extremes is usually more profitable than what happens at the centerline.

            • perversionofthemean says:

              I go too granular with my time frame, and rarely get the big score (at least trading ES/NQ). If I applied my usual index rules, I’d be so much better off.
              Centerline means you’re at the mean, and either going to bounce or fall through (generalizing here). That’s somewhat of a crap shoot, so you’re right, less profitable. Hence my user name here; better to go for boundary cases!

  10. ariez5 says:

    Given my comment about covering last night, I feel impelled to say, I see nothing bullish here.
    No impulsive move.
    No volume.
    Overlapping waves.
    NYAD lagging badly.
    Cannot even take off with Dudley talking and China easing.
    And the last 3 days look like a descending triangle on the 15 min chart. If the pattern plays out fully, it takes us to 1780. Not saying it has to go that far. Am still on lookout for bullish reversal.

  11. EL MATADOR says:

    Tony P4 still appears to continue mimic it’s big bro P2, no?

  12. GYN LAB says:

    Good afternoon! Sellers stepping in again just like yesterday? If this sells off from here I think new LL today/tomorrow…

  13. Roger DiVito says:

    If the big sellers come in now,that’s going to scare a lot of people with a hour and 45 to go.

  14. Is anyone else considering the possibility that we are in a minor b horizontal triangle off of Monday’s bottom?

  15. johnnymagicmoney says:

    Ok Monday, Tuesday, Today


    that looks like support to me folks maybe I am wrong. seems like a good time to go long here at least for a bit. Anyone give credence to this???

    • Yes. Primary 5 started this morning.

      • johnnymagicmoney says:

        Tony – could this be the case??

        • tony caldaro says:

          put a green IV on the hourly chart
          possible, but not doing much yet

          • johnnymagicmoney says:

            I have to say just about every rally has failed and at around 2pm it started to roll over again. Then about 15 minutes later it just ramped up and went higher. Every individual name I track shows some very constructtive short term moves here. Who the F knows but looks good so far.

    • Dex T says:

      It’s tough to say. People have been calling bottoms with every tiny move up but the strength and ferocity of the sell off should keep everyone wary.

      If the market doesn’t sell off into the close I’m considering a long as well with a tight stop.

      But as I type this the intraday 30 point S&P rally seems to have broken and the MACD on the 5 min is rolling down and about to crossover.

  16. Today is one of those days everyone thinks we repeat yesterday but with short covering, it s possible we wind up 500.See you tomorrow all.

    • Page says:

      It was good sign that market faded early, not at the end of day. If the rally holds today then shorts will run for exit tomorrow.

    • Roger DiVito says:

      Yesterdays decline was either a X or 1,todays is just further distribution. I would be suprised if the sellers don’t take hold in the last hour and reverse all of todays gains again. The only buyers are traders,the Fed,and corporate buybacks.

  17. ABchart says:

    Excuse me, I had not followed the end of the US session yesterday. What happened in the last hour? ES -70 points…

  18. H D says:

    ground hog day, huge gap up -34 point hit, should retest 1901 P if they run same as yesterday. Then we see new prices hopefully.
    Not being critical of the triangle but this is exactly why I expressed concern. Very dangerous pattern.

  19. nickokc says:

    I believe this market won’t stabilize until Oil find bottom Tony do you have count on silver? thanks

  20. lunker1 says:

    if it quacks like a quack it’s a quack.
    ahhh the internet!

  21. This may have already been offered up, but P2 was ~ 300 points, so 1828 pivot makes sense for P4. If this ends up extending to another degree, note that P2 was a 38.2% fib retrace of P1. If we do the same fib for P4 then something in the mid 1700s makes sense (Perhaps 1779 or 1699 pivots?).

    On a time basis, P1 peaked in May 2011 and Bottomed in October 2011. Perhaps we get a September retrace and the final P4 low in October.

    Is there any basis to believe the whole 2009-2015 rally was just an A-B-C and we do a series of three wave moves up and down for the next decade?

    • 7dayyss says:

      Some others talking that, like it’s a for sure thing. Nullifies EW in general doesn’t it? All time new highs made in an ABC! How does that happen!

  22. zepfan123 says:

    My observation is the market still appears to be undulating lower with lower highs and lower lows…at least so far with yesterdays double bottom at SPX 1867. This mornings high print is lower than yesterdays high print and we’re already 300 Dow pts off the high so the down trend still seems t be intact.- As far as the VIX ..it is basically flat at 35 today..still quite high and normally would indicate lower prices to come. Still expecting us to close lower than our recent low of 1867. It might even happen today the way this thing is acting right now with over 3 hours of trading left today.

  23. 15 mnts pattern ES continuos contract, overlapped

  24. elmer510 says:

    Thanks to Tony for predicting this primary 4 which was not easy to trace especially after SPX moved sideways for so many months. What a good job to foresee this strong decline which took many by surprise.( And prevented me from loosing a lot of USD.)
    After reading this blog systematically for a couple of year, I can say the last week was the greatest moment.

    And now many journalists and commentators are pessimistic about the outlook, while Tony is writing about the final, minor wave downwards and time for new period with stronger stockmarkets. Interesting !

    One question to Tony – about the oil market – have we now seen the bottom of the oil price according to EW?

  25. Roger DiVito says:

    Silver down 60 cents. Inflationary expectations are crashing. I don’t see how this market will stay up even though todays actions looks to be supported. Eventually it will give way and accelerate down IMHO.

  26. berniebaruch says:

    Anyone have a good link to the vix futures?

  27. Roger DiVito says:

    Clearly a distribution pattern since the first big impulse down. Further downside coming.

    • tommyboys says:

      Disagree. Any further downside will just be a retest with possible undercut but looking more and more like the bottom is in…

  28. The A/D is 2000 up stocks 1000 down…so based on that it seems we won t repeat yesterday.Imho.

  29. llerias7 says:

    That is it: the “train” has just left the “station 1900″…next stop – “station 1800´s”…

  30. ABchart says:

    Dudley: “We are a long way from talking additional quantitative easing”

  31. lunker1 says:

    SPX Lower BB 1899/1900 ish
    VIX Upper BB 35.5 ish

  32. Gary Lewis says:

    Whatever happened to that commenter who was calling for $10 silver last year? Wonder what he’s thinking as we get closer to that target. He seemed to have a good insight into the mining industry.

    • EagleSeagle has a very low($8) gdx price I believe.Now Dudley just came out and said rate hike in Sept is less likely.Bad for dollar good for gold? I need to take a look.Good luck.

  33. argento1 says:

    A system can only take you till a certain point, experience and skills trading this market is much more valuable, but well done on financialblog for calling this rally!The final low of Primary IV is not yet in, we have no breach of the monthly lower bb and with no divergences yet in the SPYDER volume and VIX expect lower prices soon!The weekly macd still has some room down to run and in short mode!This bouncing will ultimately result in a move down…my take end of next week the low around 1790-1810!


  34. reddragonleo says:

    financialreportsblog ,

    You system must be close to mine as I seen the bottom yesterday too and told everyone in the Skype rooms I’m in all day. I usually put it up on my blog too but it’s down right now as my hosting company said I used too much CPU resources Monday so they restricted access to it. I’m working on getting it back up but for now I can only post my thoughts and calls on Skype and Twitter.

    Not sure why my hosting company took me down on the day of the crash but I guess it was from increased traffic from me calling the day of the crash exactly 2 months ago based on rituals that the elite do and put in a movie called Lucy.

    That is the one thing extra I have that very few follow, and might help you in your calls as well. While my analysis told me to go long yesterday just like yours did it only told me to go short last week and didn’t say a crash was coming… only my research on ritual dates and codes of the elite told me it would be a crash.

    Anyway, would still love to chat via email, phone, or skype some time. We have a lot in common, and I have something you don’t follow In fact I think that once I see the topping zone for P5 in 2016 or 2017 I should be able to narrow it down to about a 2 week period and with further research includes rituals of the elite I’ll have a good chance of nailing the exact date. Not positive of course, but I did nail this crash date, and it was all based on a passport in a movie.

    • Dex T says:

      “further research includes rituals of the elite I’ll have a good chance of nailing the exact date. Not positive of course, but I did nail this crash date, and it was all based on a passport in a movie.”

      Can you explain further what a movie called “Lucy” has to do with the markets?

      • reddragonleo says:

        The market is 100% rigged Dex… planned years in advance. The elite that run it already have the day for the final top set. They have buddies out there that they send coded messages to, so they also can get positioned properly before the move. Some of the moves are sent in what I call “Fake Prints” (FP’s)… other big events are in movies and TV shows.

        The matrix sent a coded message about 9/11 happening 2 years before it happened. I that case the insiders told the date and the location, but you had to know that the capital city of America was New York City when George Washington was president. So saying that Neo (in the movie) was born in :”Capital City” was a coded message to say that both the old capital (NYC) and the current capital (Washington D.C.) were the targets for the event… and of course the date was his expiration date on the passport.

        In the recent movie called Lucy with Scarlett Johansson her passport has an expiration date of August 24th, 2015… so that information with other stuff I follow (don’t want to discuss it here) told me that something big was going to happen on that date. When I combined all my research I knew we’d have a crash move in the market. Didn’t know how far of course but I was about 80-90% positive we’d tank hard on the 24th.

        • Dex T says:

          I see. Well I agree with you on the markets being rigged but the rest of your post is in the realm of conspiracy theory.

          It seems like a lot of unnecessary trouble to try and send coded messages through film when they could just meet up at a financial convention and agree on a date and time to orchestrate a crash.

          • reddragonleo says:

            The most important players do meet up and set the dates, but they have thousands of minions that aren’t at the meetings, so that’s the only way to get the message out to them. They are low level minions of course, and sometimes need to be sacrificed (like Bernie Madoff was) but they still feed them information so they can profit and be loyal to their evil masters when called upon to do another bad deed.

        • We’ll since you brought it up what is the deal with September 23, 2015 other than a double 11 day, extra chaosy. I think that date is the top of the B before a ramp down C. The rats are running down the ropes.

          • reddragonleo says:

            It’s the Shemitah date Steve. A distraction in my opinion as too much information is being said about it. Just search youtube for shemitah and/or blood moons and you’ll see there’s a lot of information out there on the subject. That tells me we’ll bottom in that period and not crash again.

  35. cicelyalaska says:

    I see rabbittrader1 has been reincarnated. Follow along to make your millions. Lets see how long this one lasts. Oh, and buy his book. Good luck all! 🙂

  36. mike7x says:

    A close above SPX 1901 pivot and preferably 1926 should support the bullish case. Otherwise a test of the lows more likely.

  37. EL MATADOR says:

    Sorry all but I just had to say it again.

    Sell in May and Go Away will be Victorious!

  38. Gary Lewis says:

    I was listening to some Martin Armstrong last night. His thought is that as stocks weaken, the bonds will soar but then they will collapse and as a result of a lack of faith in the government, investors will turn to the corporate sector and stocks will soar. That’s a little different than “the sky is falling” narrative that some have. Interesting times ahead for sure.

    • Dex T says:

      Does Martin Armstrong have any price targets for his “stocks will weaken and bonds soar”?

    • EL MATADOR says:

      EL MATADOR says:
      August 19, 2015 at 12:18 pm
      No P5 not a fat chance……all scares foreign funds will inflow mainly into US market regardless of global economy floundering just as it did during early 1930’s

      Gary if my memory serves me right I think it was from during 1932 to 1936 when we saw this. Maybe someone can correct me if I have may facts wrong.

    • ABchart says:

      He gives a level to buy on stocks?

  39. EL MATADOR says:

    This is just bounce….P4 will bottom when the VIX retest it +50 reading high…..PERIOD!!!

    • mjtplayer says:

      Day 3 of the VIX trading consistently in the 30’s. The longer the VIX trades 30+, the more the futures curve will get pulled higher with continued backwardation, which is a disaster for the inverse VIX ETF’s like XIV.

      Shorting the VIX is great on the way up, as these ETF’s benefit from the time decay in the futures curve contango. But it’s vice versa during corrections/bear markets as the futures curve is in backwardation. The longer the VIX stays elevated, the more these inverse VIX ETF’s will deteriorate.

  40. going to be a long day. So far 1901 pivot has held. but barely. will see

  41. ariez5 says:

    SLV and GDX have broken their lows.

  42. purplember says:

    confused…. did we make double bottom and buy now? or another trap and heads lower ?

    • alexhartley1 says:

      Personally as mentioned before I am looking for a low on the 28-31. As of yet (and before I see the rally from wherever the low (perhaps 1820 ish) bottoms,
      I am not convinced that it won’t just be a Major A low of Primary IV. Some cycles point to a Primary mid-October low not an end of August one.

  43. kvilia says:

    Pug’s twit: $SPX double bottom (1867) target is 1954 – (1954-1867) = 2041, which is my Primary B (PB) bounce target and a 62% Fibonacci retrace.

    That’s my original thought, too – SPX retrace to 200MA, then we will see if this will be the end of the downtrend.

    • Woke up to +400.Now 300.They can t do it again can they? In a about 10 minutes if they feel like it…lol.Very strange not to see Dax up 360 with this Dow move.That can t last.I know Europe had their move yesterday but still….now the dollar is taking off-which is what got us here in the first place.Good luck all.

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