Wednesday update

SHORT TERM: market pulls back, DOW -159

Last night FED governor Brainard gave a speech: Overnight the Asian markets lost 0.1%. Europe opened higher but lost 0.2%. US index futures were higher, then lower, overnight. At 8:15 the ADP was reported higher: 217K v 182K. Then at 9am FED governor Tarullo also gave a speech: The market opened two points below yesterday’s SPX 2103 close. It then ticked down to SPX 2100 in the opening minutes before hitting the high for that day at 2104 by 10am. After that the market started to pullback. The pullback continued until 12:30, when FED chair Yellen gave a speech: Then after a bounce to SPX 2098, just before 1pm, the market headed even lower. At 2pm the FED released its Beige book: Just past 3pm the SPX hit 2078, bounced to 2085 in the last hour of trading, dropped to 2077, then closed at 2080.

For the day the SPX/DOW lost 1.00%, and the NDX/NAZ lost 0.65%. Bonds lost 9 ticks, Crude dropped $1.70, Gold slid $16, and the USD was higher. Medium term support drops back to the 2070 and 2019 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow: weekly Jobless claims at 8:30, then Factory orders and ISM services at 10am. Also at 10am FED chair Yellen testifies before the Senate. Then at 1pm FED vice chair Fischer gives a speech.

The market opened slightly lower today, ticked up to SPX 2104, and then went into a rather steep pullback to 2077. We had noted the choppiness over the past week, and were using SPX 2090 as a somewhat important level. With the market’s decline below that level today the short term count is not as clear as it has been for the past couple of months. It now appears that the four waves up, (2067-2046-2097-2070), from the Major 4 low at SPX 2019, may have been Intermediate waves. And the choppy action since SPX 2070 is part of Intermediate wave v. For now, it appears SPX 2094 was Minor 1, and the 2080-2104-2077 is an irregular Minor 2. Naturally a further decline to SPX 2070 would eliminate this scenario, and some caution medium term would be advised. Short term support is at the 2070 pivot and SPX 2046, with resistance at the 2085 pivot and SPX 2104. Short term momentum ended the day quite oversold. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: bull market



About tony caldaro

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340 Responses to Wednesday update

  1. stephenk1980 says:

    Jan to Feb 2002 exact pattern in yen as now. Both time and price (closing) symmetry which is why I’ve been buying yen. Signals trouble in stocks, but I’m actually medium term bullish as I still consider this P4 and don’t see a P5 end in sight. Where’s the euphoria? Where’s the Bloomberg news proclaiming stocks up, up and away? Until we see that, this party isn’t over imo.

  2. jeffbalin says:

    332 posts, double yesterday. Did I miss something? An earthquake or a mudslide? Tony may have some cleaning up to do to straighten this mess out. I’m glad he’s in charge, the best man for the job.

  3. NybisSibyn says:

    Close at 2036 today?
    We are in the beginning of The Big Black Hole.
    Cu… Bye.

  4. ariez5 says:

    I was definitely expecting new highs, but taking a step back, the Dow chart sure looks like 5 waves up from 1867 with a failed fifth. Don’t know if these are 5 Major or Intermediate waves.

  5. quantmaven says:

    *** S&P 500 Intraday Update *** Closing Bell //

    We should close at a new low most likely and there is more downward waves to unfold tomorrow or tonight!

  6. Arthur Knopf says:

    The only indicator that I follow that warned of a S/T top was the VIX term structure (2015/11/19/thursday-update-505/#comment-228111). I was looking for Fast STO of 80 but due to declining tops only reached 78. Now at same level as previous low at SPX 2020:$VXV:$VIX&p=D&yr=1&mn=0&dy=0&id=p89563657838

    I still want to see break of SPX 2000 and VTS at 1.0 for buy signal.

  7. johnnymagicmoney says:

    Geeez this market is going to close at its lows today

    ugly ugly ugly – every rally is being sold – last half hour is going to be a cluster F

  8. gary61b says:

    TF on 5min chart possible IHS at the 1173.5 level, potential of 8 ish points

  9. buddyglove says:

    Kudos to bears who caught this move today. I got trail stopped out of longs on sp and dax for modest profit, and now standing aside to see what happens next. Good fortune all.

    • ariez5 says:

      Bravo to you for your modesty.

    • kvilia says:

      It’s all about having protection, right 😉 ?
      I did extremely well until bought medium size XIV today at 28.3 being so biased towards the PV and new highs although my eyes are telling me this is a low probability at this point. If markets move down tomorrow in the same fashion, it will be a long, long move.

  10. reckless says:

    SPX is reaching the same level of oversold that it hit on Nov 16 but at a higher price level.

  11. johnnymagicmoney says:

    was 2040 a pivot???

    • budfox9450 says:

      No, do not see it, see only 2019…

      • manunidhi21 says:

        2040 has been an imp. level for a long time..may be not pivot but used to be line in the sand.

      • rabbittrader1 says:

        Jingle Bell Rock the market has seen the low here, Next stop for probable first wave of powerful wave three of wave V is 2150 for Xmas rally. Next stop maybe 2302 early Feb 2016.

        • johnnymagicmoney says:

          when you start making these claims it makes me want to short now

        • Rabbit, you one call right last year when you called the day of the top exactly. But after that your calls have been… how do I say it? Off by a wide margin… to be nice. The odds of 2302 by early February of 2016 are about as good as me winning the powerball lottery… especially when I never buy any tickets. But hey, it’s your call… and we all have the right to say whatever we want. I’ll just say… good luck to you on that one.

        • Dex T says:

          An S&P rally of over 150 points in January?

          What about wave 2 of this supposed move? Even if we hit 2150 by end of year for Wave 1 then market would correct for wave 2 for a week or 2 and then rally 150 points in a couple of weeks???? That would be even more powerful than the 3 of 3 wave that occurred this October- and that broke records

  12. Let’s see how Santa Claus likes it when I celebrate Festivus this year!

  13. budfox9450 says:

    Odds favor the OEW pivot of 2020, next….Bud

  14. kevinm76 says:

    FOLKS! Don’t get too excited about this sell-off. Markets NEVER go down to a substantial % in Dec.

    Amazing how the perma-bears come out in mass. It really shows the amateur tilt in them. Seasonality is GOD to the markets.

    BTW Primary 5 will subdivide absolutely NO DOUBT about it!!!!!!! What does that mean to the simpletons? A long drawn out bubble phase happening now until 2017-18. There is no-where else money can go. Think about it FOLKS!

    EOD…good day

    • tommyboys says:

      We see the same…+1

    • chrisk44342 says:

      I disagree. It can go into your bank earning zero or negative interest. If someone has lost confidence in the market, ZB rates looks phenomenal. Not sure about amateurs and simpletons, but I don’t know any professionals who say ‘NEVER’.

    • simpleiam says:

      Being Simple as I am, I believe in Sanny Claus!

    • Dex T says:

      There is no guarantee of a bullish December. We could bounce around for while and end up neutral.

      Going back over a 10 year period only the first 2 weeks of December are bullish. The last 2 are actually neutral.

      As far “amateurs” and simpletons speak for yourself!! Looks like YOU bought at the top and are now trying to convince the rest of us to buy to try and break even!!!

Comments are closed.