Tuesday update

SHORT TERM: gap up opening starts week, DOW +390

Monday and overnight the Asian markets gained 0.2%. Europe opened higher both days and gained 1.9%. US index futures were higher overnight and the market gapped up at the open to SPX 1949. The market had closed at SPX 1921 on Friday. In the opening minutes the market rallied to SPX 1961. Then after a pullback to SPX 1947 by 10:30 the market headed higher. At 3pm Consumer credit was reported higher: $19.1bn v $20.7bn. The afternoon advance continued into the closing minutes, when the SPX hit 1970 and closed at 1969.

For the day the SPX/DOW were +2.45%, and the NDX/NAZ were +2.80%. Bonds lost 15 ticks, Crude slipped 15 cents, Gold was flat and the USD was lower. Medium term support rises to the 1956 and 1929 pivots, with resistance at the 1973 and 2019 pivots.

Today the market had its fourteenth consecutive gap opening to start the week. The market remains quite volatile, as there was a 30 point ES range in holiday trading which expanded to a 40 and then 50 point range during today’s trading. Several possibilities exist for the rally from the Minor wave A low at SPX 1867. Minor B completed at SPX 1993, Minor B is forming a triangle should the SPX remain below 1975 before heading lower, and Minor wave B is still underway. In this volatile market any one of three could work, before the market heads back towards the lows. Short term support is at the 1956 and 1929 pivots, with resistance at the 1973 pivot and SPX 1993. Short term momentum was quite overbought during today’s advance. Best to your trading!

MEDIUM TERM: downtrend

LONG TERM: bull market

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

About tony caldaro

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174 Responses to Tuesday update

  1. Gary Lewis says:

    I used to see similar scenarios when the market would do the triangle action then break out one way or another. Because volatility had been diminishing, the strong break out would cause price to quickly go overbought/oversold and then promptly reverse to the other extreme. This appears to be what happened today. But two other things happened. Think that we were brushing the 20 day moving average at 199 and change and also a test of the recent high in the move. Both failed. Momentum continues down. The only question is how low will we go? I’m thinking into the 170s SPY

  2. johnnymagicmoney says:


    1993 failed

    Pivot 1973 crossed

    Pivot 1956 crossed

    1940 ???





  3. stmro says:

    There are a lot of weak hands in both directions right now. Today’s candle is very ugly and in normal circumstances, i’d call it bearish for tomorrow.

    However in current conditions i think real money can easily push this market in whatever direction they want, in the context of a larger bearish trend.

  4. Dex T says:

    The last tiny defense for yesterday’s rally being an impulse wave 3 (at S&P 1947) just fell. No rest for the bulls today!

    1990 area is now strong resistance!

    15 min left. Can a small rally be staged for any trapped longs?

  5. rc1269 says:

    if you’re into that kind of thing, we’ve got some ugly candles forming on the daily. if we close right here: SPX and Dow both have a dark cloud cover; NDX an engulfing line

  6. robslob64 says:

    Is this market broken…hardly.

    Is it in flush mode, sure.

    The real question is…can you stay away from it…doubt most will…humans love to play…bots don’t.

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