Tuesday update

SHORT TERM: another gap up opening, DOW +167

Overnight the Asian markets lost 0.2%. Europe opened higher and gained 0.3%. US index futures were higher overnight. At 8:30 Q3 GDP was reported lower: +2.0% v +2.1%, and at 9am FHFA housing was reported higher: +0.5% v +0.9%. The market gapped up at the open to SPX 2030, and immediately began to pullback. The market had closed at SPX 2021 yesterday. At 10am Existing home sales were reported lower: 4.76M v 5.36M. Just past 10am the SPX hit 2020, closing the gap, and then started to rally. The rally continued into the last hour of trading when the SPX hit 2043 at 3:30. Then after a quick pullback to SPX 2035 the market closed at 2039.

For the day the SPX/DOW gained 0.90%, and the NDX/NAZ gained 0.65%. Bonds lost 11 ticks, Crude gained 35 cents, Gold slid $6, and the USD was lower. Medium term support remains at the 2019 and 1973 pivots, with resistance at the 2070 and 2085 pivots. Tomorrow: Durable goods, the PCE and Personal income/spending at 8:30. Then Consumer sentiment and New homes sales at 10am.

The market gapped up today for the second day in a row and fourth time in the last six trading days. It opened at SPX 2030, pulled back to 2020, and then rallied to 2043. No opening at the high of the day today, so the trend may be changing. We posted a potential Minor a low/Major 2 low labeling at SPX 2005 on the hourly chart during the day. Lots of mixed signals at Monday’s SPX 2006 low. Currently we see a rally to SPX 2023 off Friday’s 2005 low, then a pullback to 2006, followed by a five wave advance to 2043 today. Thinking it could be an a-b-c counter-rally: 2023-2006-2043, or a small 1-2-3. With the market extremely overbought the next pullback should give us some hints. Short term support is at the 2019 pivot and SPX 1993, with resistance at SPX 2042 and the 2070 pivot. Best to your holiday trading!

MEDIUM TERM: downtrend

LONG TERM: bull market

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

About tony caldaro

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237 Responses to Tuesday update

  1. Gary Lewis says:

    end of the day ramp up coming? Extending into tomorrow? I hope. I have some “protection” 207-210 Jan call spreads that I bought for pennies last week. They might come alive? I think this is called Serendipity? Always pays to have some offsets in case I’m dead wrong on my main position, which seems to happen a lot since I’m more or less a perma-bear. 🙂

    • LBSPYtrader says:

      Smart. Be careful you may get chastised like FRB for playing both sides of the market.
      Someone on this blog did not understand that you can do that.

      • timmy321 says:

        “Someone on this blog did not understand that you can do that.” ………but everyone on this blog knows that you and FRB are one and the same. How much time do you have on your hands?

      • CampFreddie says:

        Trying to play both sides of the mkt just locks you into a loss, or a very small “not worth the risk” profit.

        • LBSPYtrader says:

          Camp, you are probably right. I usually have positions based on the long term, intermediate term and short term. So I may be short long term but buy call options for counter trend moves. It may be better just to be all in one way or the other.

  2. gtoptions says:

    Thanks Tony
    SPY ~ Stalled at WR1 @ 206.08 ~ Next? WR2 @ 208.12
    Ho Ho Happy Holidays! 🎅

  3. budfox9450 says:

    SP500, appears to be more “Overbought” at 3pm est today….

    • blackjak100 says:

      watch the daily next week for RSI to hit around 80-85 before thinking int i is over. There’s quite a bit of room left to the upside IMO.

  4. Caldaro.

    I love you !!!…there I said it. Merry Christmas, Happy Holidays and May the Almighty keep you safe, healthy and hearty and may you be running this blog another 50 years.

    Cheers Tony!!

    PS: Would u say that the chances of Major 2 being put in at 2005 are now greater than 50%? Thx

    • blackjak100 says:

      Do you love me?

      blackjak100 says:
      December 19, 2015 at 8:57 am
      Thx TC! Nate has something very similar using classic EW. Not sure where he got the ‘phantom spike’ down as I’m not seeing it anywhere else. However, it seems to affect nothing and suggests Major 2 possibly completed Fri (he never labels completion early). Why? Fib ratios are perfect…Wave 3=1.618 * Wave 1 & Wave 5=.618 * Wave 1. If not, maybe a marginal new low Mon AM to get a CN Big UP setup and keep wave 5 fib ratio intact. Time-wise, using classic EW count so far…Major 1 (1872-2116) = 25 days, Major 2 (2116-2005) = 32 days. Hmmmm…25 * 1.272 ext = 32. It would not shock me if Major 2 is a OEW failed flat ending at 2005 Fri because of upward pull of Major 3 beginning. NYMO -93 reading at 1993 and close outside lower BB still has me believing 1993 was significant low.

      There’s still hope for the bulls and a lot of evidence suggesting bull market is intact. With that, Happy Holidays, cheers, and GL!

      • EL MATADOR says:

        Hey BJ, why did Nate dump his triangle (from Dec 16th post)? Like I said zero chance that was a triangle.

        • blackjak100 says:

          you were exactly right! Because more price data (2077-2005) is the simple answer. He thought 1993 completed wave 2 as an ABC with B wave triangle, but the 2077-2005 decline gave him more info. Truth be told, he actually nailed it. Still has an ABC with no truncations. Just needed C to finish below 2019.

      • I love y’all here ofcourse…Good band of brothas & sistaaz!! While we do have he occasional Trump trolls n end of the world mongerers…but hey, that’s what makes us human!!

        It’s a testament to Tony to have such good posters here band here and give out free information.


    • tony caldaro says:

      happy holidays Rocky!

  5. camper1888 says:

    1 question, Did anyone see the vxx and uvxy? If the market is so bullish,why vxx is only down less than 0.40?

  6. I was looking at the 5 day nasdaq chart. On Monday it looks like there could be a nested 1-2,then since almost the end of the day Monday,we started wave 3 of the inside 1-2 and just recently this afternoon started wave 5 of that wave 3.

  7. Tony,

    A week ago you said that you were looking into oil. You think we are in somewhat of a wave up for now.

    Mery Christmas to and your peeps on this site.

  8. tommyboys says:

    Cleared the convergence of averages between 2058& 2062 now. Looking super bullish with lots of juice left in the intraday tank! Go baby…

  9. timmy321 says:

    Tony, what do you think of the breadth? It is very strong. Looks like a good case for major 2 being in.

  10. nsteve24 says:

    Still in Downtrend ?

  11. llerias7 says:

    SPX clearly in the OEW1970 pivot range! Major 2 behind (?!)…

  12. manunidhi21 says:

    Americans energy field is going in this way.


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