weekend update


The market started the week at SPX 2079. After a gap up opening on Monday the market rallied to SPX 2116, a new uptrend high, Tuesday afternoon. After that it pulled back for the rest of the week, hitting SPX 2084 on Friday, and closing at 2099. For the week the SPX/DOW were +1.20%, the NDX/NAZ were +1.60%, and the DJ World index rose 0.10%. On the economic front positive reports out numbered negative ones. On the uptick: construction spending, auto sales, ISM services, monthly payrolls, the MMIS, the GDPn, consumer credit, plus the unemployment rates and trade balance improved. On the downtick: ISM manufacturing, factory orders, the ADP, the WLEI and weekly jobless claims rose. After the close Friday FED governor Brainard gave this speech: http://www.federalreserve.gov/newsevents/speech/brainard20151106a.htm. Next week’s reports will be highlighted by Retail sales, the PPI, and Export/Import prices.

LONG TERM: bull market

The 2009-2015 bull market continues to unfold as Cycle wave [1] with five Primary waves. Primary waves I and II completed in 2011, and Primary waves III and IV completed this year. Primary V is currently underway from the August SPX 1867 low.


When Primary V concludes, which could be this year, the Cycle wave [1] bull market will be over, and a Cycle wave [2] bear market will follow. The bear market should last about two years and the market should lose between 45% and 50% of its value. Our potential upside targets for the bull market high are posted on the weekly chart above. After six years of rising prices it is time to prepare for a couple years of declining prices.

MEDIUM TERM: uptrend

While the Primary IV correction was a bit tricky, due to all the volatility, we did get an uptrend confirmed just above the secondary low at SPX 1872. As a result we posted the Primary IV low at SPX 1867, a Major wave 1 at 1993, and irregular zigzag Major 2 at 1872. After that the market took off to the upside in a Major wave 3. This week the SPX came within 19 points of its 2135 all time high. And, the NDX made a new all time closing high. Finally eclipsing its high of the year 2000. More confirmation that Primary V is unfolding.


The recent five week rally from SPX 1872-2116 was quite easy to track until late this week. We had counted five waves up to SPX 2022 for Intermediate wave i, and an Int. ii pullback ending at 1991. Intermediate wave iii progressed right along with Minor waves 1-4 at SPX: 2039-2017-2080-2059. The market then rose to SPX 2085, pulled back to 2063 right after the FOMC meeting, then rose to 2094, dipped to 2079, then hit 2116 on Tuesday. Clearly the last five wave move, which should have been Minor 5 of Int. iii was quite choppy. Nevertheless our Int. iii upside target of SPX 2120, from the 2090’s, was nearly hit.

After the market pulled back to SPX 2090 on Thursday we had to review the entire rally from SPX 1872 – 2116. This kind of choppiness late in a rally usually suggests there is another count at work. In the Thursday update we posted two possibilities. Either Int. iii ended as expected or Major 3 had ended at SPX 2116. Medium term support is at the 2085 and 2070 pivots, with resistance at the 2131 and 2198 pivots.


As noted above there are two possibilities for the recent SPX 2116 high: Int. iii or Major 3. If Intermediate wave iii topped then the Thursday-Friday pullback: 2090-2104-2084 should be sufficient for Int. iv, and a rising Int. wave v should be underway. Our estimated support for Int. iv has been the 2085 pivot range.


Upon further review of the daily charts, we have noticed negative RSI divergences on all four major indices. This suggests the recent high could have indeed been Major wave 3. These divergences do not totally rule out one more higher high for Int. v. Which would probably just extend the divergence further. But it does suggest that Friday’s SPX 2084 low is now a key support level, as is the 2085 pivot range.

Intermediate wave pullbacks during this entire uptrend have ranged between 31 and 42 points. Suggesting an Int. iv low between SPX 2074-2085. Since this range was hit on Friday with an abc decline, and an hourly RSI got oversold, Int. iv should have bottomed there. The only Major wave pullback during this uptrend was from SPX 1993-1872, or 121 points. While we are not expecting anything exactly that large for Major wave 4, since that occurred during a volatile period. A Major wave 4 pullback, from SPX 2116, probably would not find support until it hit the 2019 (pivot) – 2040 range: a 80 – 100 point pullback.

If SPX 2084 holds support, an Int. v rally to slightly higher highs is next. If not, then the Major wave 4 pullback continues into the SPX 2020-2040 range. Either way a Major wave 4 pullback should occur soon. After that a rising Major wave 5 should take the market to all time new highs and probably conclude the bull market. Short term support is at the 2085 and 2070 pivots, with resistance at SPX 2120 and the 2131 pivot. Short term momentum hit oversold on Friday, then bounced to neutral.


Asian markets were mostly higher on the week for a net gain of 1.3%.

European markets were also mostly higher but gained only 0.3%.

The Commodity equity group were all higher and gained 1.2%.

The DJ World index continues to uptrend and gained 0.1%.


Bonds are downtrending and lost 1.4% on the week.

Crude remains in a downtrend and lost 4.5% on the week.

Gold is downtrending and lost 4.3% on the week.

The USD continues to uptrend and gained 2.3% on the week.


Tuesday: Export/Import prices and Wholesale inventories. Thursday: weekly Jobless claims, the Budget deficit, a speech from FED chair Yellen in the morning, then a speech from FED vice chair Fischer in the evening. Friday: the PPI, Retail sales, Consumer sentiment and Business inventories. Best to your weekend and week!

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

About tony caldaro

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290 Responses to weekend update

  1. Arthur Knopf says:

    For those of you interested in FRBs system, there was a video on CNBC earlier this year about the same time that FRB started posting describing a timing method based on the VIX term structure:

    I have been thinking about adding it to my model, but it has a spotty long-term record, great in 2015 but poor in 2014. So far it has been tracking FRBs calls very closely. Its easy to reproduce at stockcharts.com and real-time quotes are available from brokers.

    • Nope. My indicator doesn’t even consider the VIX.

      You’ll also note that I started posting Signals generated by my indicator on Jan 15.

      Lastly, don’t put too much weight on what you see on CNBC or the other financial media – if anything, use such as contrary indicators and take the OPPOSITE side of the proposed trade.

  2. phil1247 says:


    you SHOULD go back and look at my posts and you will see where i have closed MANY opening position at gains over the last couple of weeks..

    look for STOP placed at xxxx …. that means the position is closed there …please look before you make erroneous accusations….

    • rc1269 says:

      cool beans phil. though i have recently been accused of being able to spend too much time on here, unfortunately i don’t have quite enough to go back and look at all your posts. however, i posted one fact and it was not erroneous. you state that embedded stoch goes by the close. ira epstein states the embedded stochastic is in place as long as the reading remains above 80. you said buy on 10/28 based on embedded stochs. 10/28 we closed at 2090 and right now we’re at 2079, which is lower. the stochs are still above 80. that was the end of my observation.
      i sincerely applaud your recent gains and hope that in the near future i can be on regularly enough to make sure to catch all the winners. cheers.

  3. H D says:

    Notable Fib control as major 3 HWB = 1994, exact major 1 price. watching Fibs 2019+55 & 2044+34 on this retrace to contain for extension short targets.

  4. chrisk44342 says:

    Don’t want to rain on any M4 parades- just noting that at 3 PM EST we may get a VIX signal to buy the market. I know, I know, it could be a B wave- just sayin…

  5. Dex T says:

    Right now it doesn’t look like OPEC is going to cut production in December. They are still fighting for market share and will have to continue to fight as Iran comes into play.

    “But speaking in Qatar at the same time, Saudi Prince Abdulaziz bin Salman bin Abdulaziz, deputy minister of petroleum and mineral resources, cautioned against making too many cuts amid the swing in prices.”

    “As we saw back in 2008, high oil prices proved to be unsustainable, and the price fell sharply following the great financial crisis. But this works in the opposite direction,” the prince said, according to a copy of his speech carried on the state-run Saudi Press Agency. “A prolonged period of low oil prices is also unsustainable, as it will induce large investment cuts and reduce the resilience of the oil industry, undermining the future security of supply and setting the scene for another sharp price rise.”


      • Dex T says:

        How so? If OPEC decides to cut production it could lead to a sustained rally in oil.

        • CampFreddie says:

          Dex, News reports are full of lie’s ,if’s,maybe’s, misinformation,misdirection and distraction. If there is to be a sustained rally in oil, then our trusty charts will be the only real help in identifying this. Gl.

          • Dex T says:

            The news will confirm what the charts are saying. Articles like this give clues. And the clue I that the Saudi’s are not going to cut production so bulls shouldn’t be counting on a rally.

            Oil’s future is very uncertain. Looking at the chart I can see a few different pathways.

            Oil can rally into December – then no production cut and the rally dies.

            Or they can announce a series of cuts and this would infer that the rally has legs well into next year.

            Or it can continue to go nowhere implying that a new price floor is set and oil’s long term path will continue to be down.

  6. Well as posted last week i wanted to see a break above 2107 before taking any position I didn’t happen and we had a weak opening .We are now well bellow 8 ema (2089 line in the sand ) and we’ve lost Embedded stochastics .At this point with this impulsive move down we might go to the 2030 area .in oreder to find a support for a santa claus rally Cheers

    • phil1247 says:

      STOCH still are embedded

      you wont know if they are not until the close today

      • Facts are facts : unless we close above 2100 TODAY the trend is bearish, do you think it wil happen? less likely ,possible but improbable downside is a lot greater than uoside very short term that’s it.

        • phil1247 says:

          look up the definition of embed stoch
          it is ONLY determined at close…
          fri close was EMBEDDED…
          you cant make up your own definitions

          • rc1269 says:

            your vociferous EMBEDDED STOCHASTICS calls on the 10/28 [close] are now in the red. i haven’t been on much the last week or so, so i’m sure i just missed your post where you closed that one out at a gain. that said, curious you’re still pounding the table on it here if you already closed out at gains.

          • Rc, your point to phil is valid but at least he has posted some profitable trades here in real-time. Thus his comments aren’t nearly so egregious in my view as someone who just got it 100% wrong yet continues to post stridently.

            It’s the internet and any foolish person can post (and many do), my only interest is in doing what I can to keep them from misleading the less aware / newer readers.

          • rc1269 says:

            cool. don’t have anything personal against him and i’m sure he’s made some good calls on here. was just pointing out a fact. cheers

          • I know what you mean rc – until a couple months ago, I could only read this blog sporadically and post even far less frequently. You seem like a good dude and I know I speak for many when I say that your posts are appreciated.

        • Facts are facts? Really??? I encourage everyone to look at the top of the comments section on Tony’s Thursday Report. I told everyone here that my indicator had just generated a Sell signal at Friday’s close (Tony’s “Friday Report” hadn’t been posted yet so comments had to be posted to the Thursday Report) and “this same poster was completely unaware and said “sell signal? No sorry”, to which I replied “I think you will be. Let’s see what happens. I am confident that anyone who sold at the close will make money.”

          tech, it’s wrong to mislead people either through intent or ignorance.

          It never ceases to amaze me how someone can be so utterly wrong then turn around and ardently contradict phil, me, or others who get it right and actually know what we’re talking about. Goodness.

          For those interested, I will be posting my pre-close outlook in the next 30-60 minutes or so at http://www.FinancialReportsBlog.wordpress.com – GL, and don’t let the ignorance of the unknowing lose you money.

          I posted this on my blog but not here, the Options from Friday afternoon were up over 100% today as expected so I deemed it wise to bank profits on half of the position and let the rest run until my indicator generates its next Buy signal, which could occur in the not-too-distant future, see my blog for full, real-time details. GL

          • H D says:

            PBR, just one good trade, it takes many, years of them actually. good job though!

          • Thanks HD, I agree 100% and hope to make for myself and others many profitable trades for many years to come, time will tell.

            Appreciate your posts, my indicator is really good day-to-day but I think you’re better at intraday triggers which can help maximize profits.

  7. I have just read an account on MW which has certainly confused me. Whereby the writer claims we are still in P3.

    I posted this earnest comment ;

    “…how can you be in P3 while others are in P4 and some in P5? I ask seriously. The fact that “technicians” can’t agree, casts doubt on the ‘technology’?

    Just a comment…

    • EL MATADOR says:

      No, it will cast doubt on those technicians whom the market proves wrong for it is the technician who labelled it that way. Just think of it this way, think about all those Do It Yourselfers that fail to complete whatever project they undertake. Was it the tools fault or was it the DIY’ers fault due to lack of knowledge and/experience.

    • Dex T says:

      P3 advocates are perennial bulls. That ship has sailed!

      One part of the problem is different counts in different markets. Some of them are already in bears and others may not even make new highs -similar to 2007.

    • Must be Avi.He s calling for 2300-2500 next year and no end to the bull.I just wonder how experts in wave counting can be so far apart in even primary waves.That stuff should be evident to 99% of anyone who knows EW.Avi, btw, has not been the greatest this year–contrary to his “I nailed this and that to the point”.Just read his fan mail…lol.

    • chrisk44342 says:

      EW is a subjective theory and open to interpretation. Market ‘technicals’ has nothing to do with ‘technology’.

  8. Page says:

    Here is my forecast for Nov/Dec.

    • I think you may be right…eventually. Not in November though. After Major 4 bottoms in a few days, expect volatile choppiness (and frustration) ahead of December Fed. As that passes, we’ll likely get that year end pop (panic buying/Santa rally) to finish off Pri 5 into early January.

    • tommyboys says:

      Agree Page – New Moon low today/tomorrow…

  9. phil1247 says:


    extension long broke from 2034

    now see if it can retest and hold or goes straight down

    STOP from 2075 is at 2068.5

  10. rc1269 says:

    1. never heed anybody who says the odds of the market doing [ ] are “zero”
    2. beware prognosticators whose conviction is stronger than both their rationale and track record
    3. never get too comfortable with your belief about where the market is headed, and your positions
    4. re-read #3

    happy monday! cheers. -rc

  11. phil1247 says:


    last stand for extension long from 2034

    25% short from 2075 this am

  12. manunidhi21 says:

    Namaste Tony!
    Major 3 marked , I was expecting you to wait till 2070 crossed.

  13. If i remember correctly, post employment week is generally down.Ramp up into it..sell after.Ramp up for OPEX …sell after.i m just watching all this anyways at this point–looking for hammertime.The only question is one more surge to new highs first or not.To be or not to be bullish(short term).THAT is the question.

  14. mjtplayer says:

    Uptrend line on the SPY has been broken – not good. SPX morning low of 2,077 has been taken-out – not good.

    Things are starting to shift towards a larger decline


  15. ariez5 says:

    Looks to me like support may come around 2063 (200 MA) / 2060 (38.2 retrace from 1871) / 2055 (gap fill).

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