Tuesday update

SHORT TERM: gap up turnaround Tuesday, DOW +229

Overnight the Asian markets lost 0.3%. Europe opened higher and gained 0.9%. US index futures were lower overnight. At 8:30 Retail sales were reported higher: +0.2% v +0.6%, the NY FED was reported lower: -14.7 v -14.9, then at 9:15 Industrial production was reported lower: -0.4% v +0.6%. The market gapped up at the open to SPX 1960. The market had closed at SPX 1953 yesterday. In the opening minutes the market pulled back to SPX 1954, to nearly close the gap, and then resumed the rally. Heading into the last hour of trading the SPX hit 1983. Then pulled back to close at 1978.

For the day the SPX/DOW were +1.35%, and the NDX/NAZ were +1.15%. Bonds lost 27 ticks, Crude gained 70 cents, Gold lost $3, and the USD was higher. Medium term support rises to the 1973 and 1956 pivots, with resistance at the 2019 and 2070 pivots. Tomorrow: the CPI at 8:30, NAHB at 10am, and the FED starts its two day meeting.

The market gapped up at the open, pulled back, then cleared the 1956 and 1973 pivot ranges on the way to SPX 1983. A nice rally today, but it looks similar to the three previous corrective rallies from the SPX 1867 low. One could draw a trend line from 1993-1989-1983, and from 1911-1939 to form a Minor B wave triangle. With short term momentum hitting extremely overbought today that upper trend line could be resistance. If not, SPX 1993 could be exceeded and the market would still likely be in Minor B. Short term support is now at the 1973 and 1956 pivots, with resistance at SPX 1993 and the 2019 pivot. Short term momentum hit extremely overbought. 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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149 Responses to Tuesday update

  1. Mat, when someone uses all-caps and multiple (five in your case) explanation points, it clearly indicates heightened emotions on his/her part.

    Bein five months early on a call is can be as bad as being dead wrong.

    You must be confused: I DO make calls real-time, before-the-fact, see my calls of 1/15/15 and 8/25/15 as examples. And it wasn’t vague speculations as in your case, I wrote “I am very, very confident that the market will rally starting tomorrow, usually for at least 500-1000 points”, etc.

    Keep posting but try to get your facts straight going forward. No hard feelings, certainly wish you the best.

  2. EL MATADOR says:

    FRB, I’m not emotional….Let me asking you something, was your signal capable of predicting well in advance the 2014 ‘Bi-Polar” Santa Rally, how the January effect would over power the uber-bullish “Years ending in 5” thingy 2015, or how about that 2015 would see the revival of the Sell in May and Go Away, etc etc., or how about that 2130ish would be a significant Primary top months in advance or that mid to lower 1800’s would also be a significant Primary resistance zone approx. 5 months in advance, or how about the symmetrical fractal between 2011 vs 2015, I could go on and on but will let it at that? I bet it was not capable of doing that. Historical stats can do that and are very effective when interpolated correctly and used effectively for trading. I was very capable of doing this and my post prove it and support the underlining fact that historical stats are not incident. If your signal is capable of doing that then I would love to see you stick you neck out ahead of a big move like I and others have rather than having everyone waiting for when your next buy/sell signal kicks in all the time.

  3. I will not be present until next Monday since travelling abroad. GL All.
    See you at some point beginning next week.
    Market will have made his mind up by than, hopefully.

  4. RC, What are your thoughts on credit HY? Thanks

    • rc1269 says:

      it was off a little today, but didn’t seem like it was down as much as they ETFs were. longer term my view on HY largely reflects my view on equities: i plan to sell rallies until further notice. best

  5. johnnymagicmoney says:

    hmmm 1993 held so far ………………maybe yesterday was the Goldman set up yesterday (FED wont raise)

    • Dex T says:

      Could be. And here we are back again testing that level. At this point with so many rumors it seems like everything is up in the air!

      They may announce no rate hike and the market still drops!! Then what will the Fed do/explanation be?? After all – we had a 0 rate for the year and we just bounced around until we crashed in August.

      But after another morning reviewing charts and history I’m sitting out – Personally I am not a buyer here under any circumstance! If it fails again at this level then longs should seriously consider an exit!

      • johnnymagicmoney says:

        guess what – its not failing. I think a lot of the short term charting and analysis is out the window with the BOTS and the CB’s. The last year has been my most frustrating year trading ever. This market is complete BS

        • Dex T says:

          It hasn’t yet. We still have until close and tomorrow etc.. It could be a last desperate attempt to push out. And as several people have posted the turns tend to some towards end of week. ordinarily tomorrow or Friday.

          Personally I don’t know and sit these moves out in cash. Much less frustrating!

        • The most hated Bull market ever. Market has no fear. could this time be different ? Will see. 2000 level is pretty much what everyone was looking for. Lets see what it does from here

          • Dex T says:

            It’s never different! We already had a crash just a few weeks ago and are already trading at lower levels! The technical warning us didn’t lie then and aren’t lying now. Just use caution and tight stops! Right now it’s a gamble.

  6. johnnymagicmoney says:

    take a look at the falling wedge on the 30 min VIX ………..


  7. johnnymagicmoney says:

    you would think all of the support (resistance now) from December14 to Feb15 and 8/28/15 would contain the move up to 1993 today. So many thought the initial Oct 14 rebound of 1820 was a B and then it kept going and going and going! Why then are so many people thinking this is a B still? Tony originally put the IV at 1867 and then days later said would retest or go lower. I know people have said B’s are complicated and difficult to judge but man o man this board was mysteriously looking for the B in Oct last year. What makes so many people think this wont just V up again? What makes this move down is different than October in regard to a restesting much longer than a few days? Maybe the retest of 1867 in those two days in that 3 day period. Thoughts?

    • rc1269 says:

      “Why then are so many people thinking this is a B still”

      speaking just for myself-
      1. much more damage was done this time around on longer term technicals
      2. this selloff overlapped Oct 2014. Oct ’14 didn’t overlap anything of significant.
      3. Oct ’14 merely erased some recent gains. that’s a but the dip ‘clue’ for those who missed the gains. This selloff came after literally 8 months of no gains. that means it’s not a chance for dip buyers who missed out; it’s a new clearing level below the one in which many shares churned for months.

      in short, it looks and smells much different than oct ’14. so i expect it to also act differently. cheers

    • cicelyalaska says:

      For me, what is different is that my medium term pricing and volume technical indicators last October switched to “Buy” well before the supposed B top that kept going. This time around they are firmly on “Sell” still. Scary, but I’m sticking with my signal and my shorts.

  8. EL MATADOR says:

    “Traditionally” the Sept Opex Week high is seen 85% (if I recall my stats right) of time on either Thursday or Friday and by the same token the weekly after Opex is down hard. If don’t believe in history, I say this, “I DARE YOU TO STAY LONG THE MARKET!”

    • Mat I agree right or wrong I would rather miss a pop to the upside than get caught in a repeat of 1987

    • Dex T says:

      I recall seeing similar stats so you’re definitely in the correct ballpark! The market almost always turns around by the following Monday. It definitely did last year since I looked up the charts yesterday.

    • EL MATADOR…I m guessing this may be the top today.I had a little equity exposure I sold off today.Just have GDX now (15%).I think they raise rates .15 and then .10 in December.That s it for me.I d be shocked if we re still above 16500 after Friday.Cheers.

  9. Dex T says:

    Market has been super quiet last hours. The algos patiently pushing it up. The slightest leak from the Fed meeting can get volatility skyrocketing again!!

  10. A little difficult to tell but perhaps in 5 of 5 from Friday’s lows. Trader Joe’s contracting triangle is still in play with SPX just having made a higher high above 1993.48 to match the INDU which also made a higher earlier today. This would be wave 3 of A of (B) for these 2 indices. NDX has already made a second higher high thus wave 5 of A of (B). These new highs within the triangle are fairly incremental so no tearaway move is necessary from here. The next move of significance would be wave 4 of A of (B) for INDU/SPX which would move down into the 1960s area whilst NDX would perform B of (B). CAC, DAX & FTSE were following NDX step for step until the highs of 9/9. Since then CAC & FTSE have invalidated the rules of contracting triangles and are obviously doing something else from an EW perspective. DAX is still a candidate but is 2.7% below its high of 9/9 whilst NDX surpassed that level today. One other thing, because these higher points in the triangle are only incremental it will leave INDU/SPX with double and even triple top formations. Again, the size of the pullback will be the determinant as to whether the contracting triangle remains in play or something more sinister is about to overwhelm the market. Best of luck.

  11. rc1269 says:

    as Tony said a short while back – we need that MACD to recover some so we can put in a nice +div to work from. so far so good.

    looking at time extension studies of recent major selloffs that resolved with lower lows and +divs on daily MACD (spx), the following seems to be the most likely path in my view:

    B wave high on ~ 9/29/15 (give or take a day). That probably puts us in that 2035 gap close and retrace target area that i mentioned a while back. Also right about where the 50 day MA should be at that time.

    C wave low on ~ 10/14/15 (also +/-). Likely a small overshoot of the 1867 prior low; perhaps something in the 1820-1830s area.

    i think this scenario produces a solid year-end bounce regardless of whether this is PIV or even something bigger.

    • Exactly what I’m anticipating (and hoping) for. As a favor, I ask that you revisit this exact post in conjunction with the timelines and price targets forecasted, if still applicable. Excellent post!

    • manunidhi21 says:

      Hi RC..
      “”we need that MACD to recover some so we can put in a nice +div to work from. so far so good”
      I think Tony talked about daily MACD and I do not see any + div unless we drop and recover

    • mjtplayer says:

      Thanks RC. i don’t know where we top from a price perspective, but from a time perspective we should top sometime between tomorrow and Monday or possibly Tuesday morning.

      When you look back at each of the monthly OPEX, the market tops/bottoms 1 day on either side of the actual expiration, with a possible overthrow to 2 days. If we continue higher into Friday’s OPEX, the pattern has been to top-out either Friday, Monday or Tuesday morning of the following week, then reverse hard the remainder of the following week. Just look at the last OPEX in Aug, the market bottomed Monday morning Aug 24th.

      • rc1269 says:

        understood. my assessment was based on prior selloffs with no consideration given to opex timing. in my observation opex does a good job pulling/pushing around the market in fairly normal markets. however, when larger moves/waves are in play i’ve found that they often tend to trump the power of opex. so personally i am not relying on that as a major waypoint this time around. just my personal view. appreciate the color.

    • kvilia says:

      Thank you, RC. 50% Fibonacci retrafement from the top is around 2000, so I would be extremely cautious if we get to this number – no men’s land between 2000 and 2035?

      • rc1269 says:

        a valid point and i think the 50% and 61.8% retracements are both reasonable targets. P2 only retraced 50%, as you likely are aware. *however*, P2 also had a (so far) much deeper intermediate b wave selloff during it’s counter trend major B wave. ie, 8/17/11-8/19/11 selloff. what that left was a bigger hill to climb to complete B. that intermediate c wave leading up to B (8/22-11-8/31/11 rally) was 100% of wave a ( 8/9-8/17; 107 pts). so, c=a during P2.
        if we go by total retracement, then 50% or spx ~2000 is your bogey. if we go by c = a, which also occurred during P2, then that gets you to 2029.54. which is pretty close to the 2035 gap and the 61.8% retrace at 2032.45.

        so… take your pick! 🙂

    • Great post rc, certainly possible, posts with actual buy/sell predictions are of greatest value and benefit, will be interesting as ever to see how it plays out.

  12. blackjak100 says:

    At least we can rule out a contracting triangle. Barrier/ascending triangle still in play, possibly wave d complete now but needs to reverse right here

  13. johnnymagicmoney says:

    This market is the dumbest market since 99 -00 and in some cases even dumber than that. Maket just does not want to price risk into the equation. Global macro horrible, NO profit growth here in the states, global deflation that massive amounts of QE is not solving, and the FED isnt doing QE anymore and if the FED is hiking its good, and if the FED is not hiking its good. Never seen such utter delusion and rationalization. So maybe the market hits new highs but inevitably you would think reason will prevail cause the global economy isnt going to.

  14. gtoptions says:

    Thanks Tony
    SPY ~ Stalled at top of ‘alleged’ triangle. Next potential resistance at 202.
    GL All


  15. I posted this on Monday morning at 8:03….spy at the moment hit 199.75 and the 200.00 spy puts value falling…..watching spy option chain is a useful tool….see if they stop the spy at 200 or below until the fed announcement… ……….”Really appreciate all the great info on this site. Just want to mention that you should take a look at option interest for 9/18. Gives great clues as to where we go this week. Market makers move price daily to R & S levels of option interest. This week we have 280,000 puts ($4.83) at spy 200.00 that mkt makers will try to kill. At the same time there are 170,000 calls (.76) that will act as R think they try to hit the 200.00 before thurs. Then if they raise the mkt falls from a higher level and if they delay the target will be spy $205.00 where there are 154,000 puts in the money at $9.18 and calls will act as R with 154,00. These are big levels that the mkt makers don’t want to pay out imo.” https://www.optionsxpress.com.au/OXNetTools/Chains/index.aspx?SESSIONID=

    • johnnymagicmoney says:

      so in laymens terms where do options say the most likely move is here? Up or down after FED?

      • Johnny..i am a layman…I don’t even trade options…but looking at the option chain mkt makers try to pin the spy price leading up to opex that gives them the most balance between the number of put and call contracts so they don’t have to pay out…right now if they move higher than 200 the spy calls begin to increase in value fast so this is a good target area for to hold at least till the fed announcement …imo….I think we will bounce around here until the 5-10-15 min charts macd gets overbought then we roll over to a lower level prior to the announcement….but could get bought back up to these levels prior to the announcement….my purpose is to just make others aware that if you watch the option chain for wklys and monthly you will see how the mkt makers move price around to benefit themselves and it can give you a good idea where we go over the 3-5 days…gl…I see we just hit spy 200.06 top?

    • john b says:

      Thanks, and good one Terry!

  16. Nice jump in gold and GDX today.Hopefully the start of something…most likely a bet ahead of the Fed, like yesterdays equity rally was.The neg CPI certainly not inflationary.However just before the last equity plunge, gold and gdx rallied 10% in a couple days.Warning sign today? Or everyone is just hedging by buying various instruments and then seeing where it goes…Good luck all.

  17. fotis2 says:

    Danger,Will Robinson! Bears…

  18. torehund says:

    $Bdi- hike of 8 percent, the big up could be in the cards next. Go shipping.

  19. pruthvi says:

    Can anybody tell me that world market worries over tonight by fed?

    Just little step for next 3 to 6 months

  20. EL MATADOR says:

    FYI – Historically Sept Opex Triple Witching and the week after Sept Opex IS one of most BEARISH…..just saying….so ya’ll know what ya’ll gotta do😎

    • gtoptions says:

      September 2015 is not part of history, Yet.😉

      • +10, the market moves based on recent data, any historical similarity is purely incidental imho.

        • EL MATADOR says:

          Sorry FRB, but you are in DENIAL on this one BIG FRIGGIN TIME!!!!!

          • tommyboys says:

            If you insist on talking cycles you best pay heed to the Presidential one…We’re in a Pre-election year (2015)…Ya know what that means?

            …Just in case;
            2012: Election Year
            2013: Post-Election Year
            2014: Midterm Year
            2015: Pre-Election Year

            The course of important US markets is largely dependent on whether the current year is an election year or one of the three cycle years following an election. Stocks tend to see an above average increase during the year preceding an election year. The reason for this development is assumed to economic policy before an election. Increasing stock prices and a booming economy sheds positive light on the incumbent political party.

          • tommyboys says:

            …and don’t forget that pesky little Shemitah cycle haha😉

          • Mat, why so emotional? See comment below if interested.

      • EL MATADOR says:

        All of 2015 was not part of history until it became part of history, nonetheless just about all of 2015 has been living up to historical stats and it is a very strong fact. So why should this one be any different?

        • It’s incidental Mat imho. Example: if a signal occurs on 10/9/02 and again on 10/9/07, the resultant market move had nothing to do with the date or ancient history, it was because of the signal which is based on recent market action/data in my view. If your opinion differs then bet that way. GL

  21. mjtplayer says:

    This is my alt count, which is possible, though not favored unless we break SPX 1,950 to the downside today (1,954 tomorrow and/or 1,959 on Friday).


  22. To those who have asked me to post my market moves here: terminated the entirety of my large bullish position just after the open, position was initiated at the close Aug 25 as posted here in real-time, sold and bought back half of the position between 16,200 and 16,500 per subsequent posts, most profitable trade yet, will now simply wait for my indicator’s next major Signal and do it all over again. GL all.

    Rc, by free money I mean selling a position at, say, 16500 and buying that exact same position back at 16200, several times. Not free in the sense of risk-free, but pretty close. GL

    • I’m not one who made the request, but I do appreciate your postings. Thanks…

    • rc1269 says:

      appreciate the follow up on the position. very happy it worked out for you!

      still don’t think ‘free money’ is a remotely appropriate phrase, but clearly we have different views of risk. ‘pretty close’ in that it worked out for you after the fact, or pretty close in that when you were doing the trades it was all but certain that you would be able to round trip that range several times? sounds to me like you might construe the former to represent the latter. but i digress. glad it worked out regardless. cheers

      • purplember says:

        “free money” is FED giving millions to housewives of wall st bankers to invest and they keep profits in 2009. why can’t we get that free money.

      • Thanks rc. Before the fact. I initiate positions based on my indicator’s Major signals (rarely ever wrong, and in those three cases was just a one-day throwover and then the expected move) and trade a portion thereof over and over based on Minor signals (about 80% accurate). It was purely coincidental that the recent Minor sells occurred at Dow 16,500’ish and the Minor buys at 16,200’ish. Next Major signal is forming so more than happy to take closeout very profitable position from Aug 25 and roll into next play when signal hits. GL

    • reddragonleo says:

      Glad to see we are on the same page (again… LOL) FRB. Today is Wednesday and going back to the 1980’s only 7% of the time did a top (or bottom) form for any given weeks’ high or low. Meaning there’s a 93% chance of a higher high Thursday or Friday since so far today has put in the high for the week. While averaging into a short position by getting 1/3rd or 1/4th position today could nail the high the odds say there’ll be a slightly higher high tomorrow or Friday to get an even better shorting spot.

      • Lol Red, yes we often see the same thing in the market. It’s possible we get a Sell signal soon but a few parameters need to be fulfilled. We certainly nailed the absolute closing low on Aug 25, man was that a fun ride … batter up!

  23. ariez5 says:

    High yield is taking it on the chin today. It looks like it is already rolling over. Yet oil is up, and stocks are holding in. What gives? Pricing in a rate hike?

  24. As I see it.
    Unfortunately is not correct to scythes Market have not try to trend. It did it. It did it twice, After the low of August has try to initiate an impulse, for a 5th. Couldn’t sustain it.
    It is trying again, and if it will not succeed this time, it will have been a failed 5th wave.
    So if a low will come it will be a real bear market starting. Not nice after a failed 5th. So hope it will succeed on the way up.

  25. kvilia says:

    Next step is well defined IMO.

  26. prakashbkc says:

    GM tony sir,
    If fed doesn’t hike then rally in market then is there any possibility of retesting of 1867 or further down move arises?

  27. pruthvi says:

    Ufff, ‘FED’ many thought , Only just 10 minute lecture and FED over,

    Just nothing

  28. mjtplayer says:

    The VIX is tracing-out a diagonal, currently falling in wave E. Spot VIX should drop to the 20 area or slightly below to complete the pattern.


  29. reddragonleo says:

    Wednesday, September 16th 2015 ES Futures Morning Update: http://screencast.com/t/4CnnAact

    • Dex T says:

      Excellent points and I agree! According to the charts you posted yesterday any rally resulting from this week gets quickly sold off in following weeks.

      I went back and checked – Last year the market rallied from the same type of slow upwards grinding and beginning the following Monday already sold off until October 15 when it reached the 1820 low.

  30. Some really good point made from the bull and bear camp. My 2 cents. Fed won’t raise rates. Markets take off, with a major short squeeze. Which will take us up to new highs and end P5 quicker then most think. As soon as October 24. If Asia is about to enter an uptrend hard to see us selling of 7 percent. Also, every wave 4 has been short and saved by a central banker. Last time was Japan QE. This time. yellen keeping interest rates unchanged forever. 1 more push in the face of negative news to finish this Bull. HP laying of 25k, fed ex missed earnings down 4 percent. But the love of free money causes risk on and new highs.

    Going to be a wild ride.

  31. learner3078 says:

    Hi Tony, I noted your insight a few days back when you mentioned hk market (hsi) has a nice + divergence at the low recently. Do you think it can sustain it’s rally today? Looking at the charts, I was thinking if it is going to head lower again, since the 28000 top I’m not sure if it is moving in 5 waves down, with 1-3 completed and 4 possibly completed today, and starting on wave 5 down soon (28000-23516-25536-20583-22215 and possibly around 20200 now next? what’s your view on the hsi? thks in advance.

    • tony caldaro says:

      Already a big decline in the HSI: 28% since April.
      It generally follows the west, but is greatly influenced by its biggest trading partner China.
      China spiked 7% today in two hours, probably gov’t intervention.
      The HSI was extremely oversold, with a +div, suggesting an uptrend may be underway.

  32. fotis2 says:

    CH on DAX worked out picture perfect at the gap up open no I wasn’t long since twas too late for a day trade.

  33. Rally since August 24 looks corrective and very weak. IMHO the market is ready to fall. Today was a fantastic opportunity to get out of the market. It will be a while before we get an opportunity like this. Looking for a steep pull back over the next week or so to SPX 1800-1805

  34. EL MATADOR says:

    Trannies, everything you need to know is on Da Chart

  35. mjtplayer says:

    tony caldaro says:
    September 15, 2015 at 3:18 pm
    during the selloff: bonds up, USD down
    during the past three week rally: bonds down, USD up

    That’s right Tony. So, if the Fed does NOT raise rates Thursday, the Dollar should drop, which means stocks should drop and bonds rally.

  36. GYN LAB says:

    Good evening!
    COMPQ kissed the .618 retrace of 5232-4292 at 4872 today… while SPX has not even retraced 50% of the decline, and this even considering that ‘missing bits’ between 1830ish and 1867 on that Black Monday. Wondering if this will disappoint all the short orders lined up at 2030-40 area and just turn back down around .500 retrace at 2000, just enough to expire all the OI at SPY 200 then back down?

    • reddragonleo says:

      Whatever we hit by this Friday I do expect it to end the rally as next week is historically bearish… so shorting over the weekend seems wiser too me then staying long looking for 2030 or so.

      • kvilia says:

        I agree. Volume, technical indicators getting overbought, damage done during August meltdown, long term MACD crosses, global economy woes, seasonality – everything supports the coming drop. But then I think about how many traders are looking at the same charts and are ready to short and getting a little uncomfortable… I will short before the end of week but with the tight stop above 2040.
        Good luck all,

  37. torehund says:


    Comparing BTK to IWM (on 1d chart) we can see that the former has already retraced 50 percent of the decline, whilst IWM just around 30 percent. Thats the bio strength I was mentioning earlier today.

  38. mike7x says:

    Thanks Tony. 2040.

  39. Looks like the record levels of small speculators shorting the futures are going to get rich apparently!😛

  40. Yesterday, the ‘triangle within a triangle’ was shown. Today, as the potential Leading Diagonal pattern would predict, the triangle broke to the upside. In real time, ‘five waves up’ were able to be counted in very acceptable form, which would tend to indicate higher prices are in the offing. Today the $Compq, and the $Ndx made higher daily highs. The Dow came within about 40 points (i.e. a day’s trading). More text below chart.

    SPX - Hourly - Sep-15 1619 PM (1 hour)_TC

    The internal formation of today’s up wave suggests it is the extended first wave of five waves up. On the SP500, today’s high did not break nearby highs so it would appear to be sub-wave i (shown in blue). Wave blue ii is likely next, given the over-bought conditions. Such a wave could retrace only 38.2% if the first wave is the extended wave.

    According to the typical descriptions of “wave personalities”, it will likely be sub-wave iii that breaks the daily high, if that should occur. Then, there would be a sub-wave four and five to follow. Keep in mind that all of wave (3) can travel no farther than 100% x wave (1) in a Leading Diagonal. So, that level (above 2038) provides an ‘upward’ invalidation of wave (3). On the downside the invalidation of wave ii of C of (3) moves down to the B wave bottom at 1949, while the invalidation of the entire diagonal remains at the 1911 level.

    Again, one of the benefits of detailed analysis is that it provides clear and actionable invalidation points based on the rules (not guidelines) of wave theory. Hope this helps.

    • ewmarkets says:

      Your C of (2) is higher than A of (2), which does not look very natural. Looks a bit forced for a leading diagonal.

      • Page 5-21 of Mastering Elliott Wave by Glen Neely states (paraphrase for brevity only), “the truncated zigzag is rarest of the zigzag formations, it is usually found ‘only’ as part of a triangle”. A key requirement is that it be retraced by a minimum of 81%. That zigzag was retraced more than 85% by the subsequent A wave upward, validating the structure. This is another example of how I have a defined reference for every wave call – whether it looks pleasing to the casual observer or not. I often wonder how many people have even read the major Elliott Wave references from start to finish.

        • perversionofthemean says:

          I own Neely’s giant book. Just never opened it!
          Will someday, but figure that it’s fallible, like my own stuff. Hoping to one day mate the two to create the ultimate system. Until then…
          Is there any part of his neo-wave that you disagree with?

          • Yes, the new patterns (diametrics, etc). They are not Elliott’s original work, and I think they just represent Neely ‘trying too hard’ after he did such a great job enumerating the measurements and ‘realistic looks’ of the standard Elliott wave patterns. As far as I can tell, the diametrics and other patterns can all be explained by the original Elliott Wave patterns, and, from what I can see, their addition has actually somewhat ‘reduced’ Neely’s confidence in making a call. Don’t get too bogged down in the first chapters where he tried to build monowaves into the other patterns – the overall patterns and their measurements are the key to being objective.

            • perversionofthemean says:

              Doesn’t sound real inspiring. Does your Elliott site incorporate NeoWave, or do you stay pure on it? THANK YOU!

    • Gary Lewis says:

      So this is the start of P 5?

      • Please see this weekend update; (September 12, 2015 at 1:11 pm) so I don’t repeat posts. L-D could be the A wave of a larger P4 triangle (with a B, down and C up to follow for (B) ), or A of A-B-C to (2), or the first wave of P5, if it occurs. Right now, I am focusing on whether it completes successfully or not – rather than trying to guess the degree of wave.

        • Gary Lewis says:

          Why don’t you wait until you know something before posting? You are making your analysis irrelevant. IMO What’s the point?

          • kvilia says:

            The man shows probabilities, invests time posting here. Did you have the point when asked this question? Million times Tony said this board is to share opinions and not grading the posts.
            Why am I saying this? Because I don’t want posts like yours make posts like above disappear.

        • Igor says:

          Well, I seldom post here but could not resist after reading this particular thread. I beg your pardon for my rant in advance.
          On one hand this forum has such posters as TraderJoe. TraderJoe being not satisfied by an orthodox EW theory which has a lot of weak spots took a next step and studied a pretty complex Neely’s Neowave. I knew only a few people who has a good knowledge of Neowave. Many years ago, when I studied Neowave, I read “Mastering Elliott Wave” three times from cover to cover to grasp fully Neely’s concepts. Actually, I find Neowave much superior to Prechter’s EW. Anyway, TraderJoe is kind enough to share on this forum his pretty accurate analysis which incorporates both Prechter and Neely’s studies. And this is an EW site, isn’t it? Actually, TraderJoe in his post gave everything a trader needs to trade in the short-term this unfolding wave. Successful trader operates not in waves or targets but probabilities. Nobody on this Earth doesn’t know what wave is unfolding, neither TraderJoe nor Prechter, Nelly and Tony. But TraderJoe based on his analysis concluded that there is a high probability that this wave up is going to continue. That’s all you need to know. Take a long position with an appropriate stop and if you are lucky enough it might be P5. If you are not lucky it’s A or something else. The main thing is that the better probability according to TraderJoe is on the upside for the time being. Thanks TraderJoe.
          On another hand this forum has posters who are not only too lazy to make their own analysis but also read carefully the analysis of others. At the same time they are quick to post rude replies for some reasons.
          I read this forum from 2007 and remember 2-3 really knowledgeable traders who stopped posting after they were attacked. I think, they just realized that it is not worth it to spare their time and knowledge in exchange for insults. It would be a loss for readers of this forum if TraderJoe quits posting. That’s all I wanted to say.

          • I appreciate Tony’s site and a majority of those who contribute here. I echo the sentiment outlined in the previous two comments. We can all do without the insults – there just isn’t any utility in it, no value-added. Similarly, I appreciate those who step up and remind everyone (when necessary) to be civil. Society, in general, could use a lot more self-policing when it comes to decency. Here’s as good a place as any to start!

    • It looks like everything is still falling into place.

  41. torehund says:

    Thanks Tony.
    Biotech (BTK) is looking promising, yet again, very shallow retraces after each wave from the bottom. Looks better than both the RUT and the SPX from day to day.

  42. Thanks Tony. What’s your personal read on Gold.

  43. gtoptions says:

    Thanks Tony
    Enjoying the Big moves while they last.😉
    Trade Safe All….

    • gtoptions says:

      FYI ~ SPX weekly 13ema is now within spiting distance @ 2024

    • EL MATADOR says:

      And the 2011 vs 2015 fractal continues????
      The 4 most recent weekly candles are strikingly similar when compare them to the 2011 candles starting with the weekly hammers (very impressive, eh).
      Now if we apply space-time from the 2011 “W4” bounce (which topped out 121 calendar days from it’s Head and 129 pt from it’s “W3” low) to 2015 that would mean that W4 should top out say this Thursday (Oops!!! FOMC day was that intentional?) and 129 pts from “W3” puts it at 1996 (Oops!!! is this going to be a marginal HH from 1993ish just to get the bulls all juiced up?). So ideally any day this week and any marginal HH above 1993 will do the trick, eh

      Man this fractal is freaky!!!😉

  44. mjtplayer says:

    Thanks Tony!

    It looks like the market rallied on the lousy economic data this a.m. – i.e. maybe the Fed won’t hike. The rally triggered more short covering, but overall volume was still light, just like the last 3 trading days. All eyes on the Fed Thursday.

    A side note: Treasuries got slammed and the Dollar rallied, both moves would suggest the Fed is going to hike. So, do you believe the bond & currency market that the Fed will hike, or the stock market that the Fed won’t hike?

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