weekend update


The week started at SPX 2022. After a small rally to SPX 2025 on Monday the market pulled back to 2005 on Tuesday. After that the market continued to rise for the rest of the week, with only 10 point pullbacks, to SPX 2052 on Friday. Ending the week at SPX 2050. For the week the SPX/DOW gained 1.80%, the NDX/NAZ gained 1.05%, and the DJ World gained 1.40%. On the economic front reports continued to come in with a negative bias. On the uptick: the NY/Philly FED, business inventories, leading indicators housing starts, and the WLEI. On the downtick: retail sales, the CPI/PPI, building permits, industrial production, capacity utilization, consumer sentiment, GDPN, plus weekly jobless claims rose. Next week we get reports on Durable goods, the Q4 GDP and more Housing.

LONG TERM: bear market

Ever since the all time high in May 2015 at SPX 2135 this market has been on quite a roller coaster ride. During the past 10 months it has declined to SPX 1867, risen to 2116, declined to 1810, and now risen to 2052. Net progress since even the beginning of 2015: -0.4%. Great for day/swing traders, but not much for investors.

From 2009-2015 the market was in a long term uptrend bull market. During that period of time we had remained long term bullish, and then turned long term bearish in the second week of January 2016. The market made a downtrend low the following month at SPX 1810, and has risen since then to 2052 this week. Quite a rebound for what we consider a B wave uptrend in an ongoing bear market. In fact the rebound appears to have been led by the cyclical indices, and not the growth indices which typically leads in bull markets. The SPX/DOW have retraced about 75% of their entire decline, while the NDX/NAZ have retraced about 60%. During the bull market the SPX/DOW gained about 200%, while the NDX/NAZ gained about 340%.


The long term count remains the same, with five Primary waves from 2009-2015 ending a Cycle wave [1] bull market. A Cycle wave [2] bear market should be underway now. There has been some debate about where the bull market ended: May at SPX 2135 or December at SPX 2116/2104. Initially we were set on a December top, but have been reviewing some counts that suggest a May top might be a better fit. Regardless of the outcome the key level to watch going forward is SPX 2135. A rally above that level would force a re-evaluation of the bear market scenario. For the past couple of years this has certainly been a difficult market.

MEDIUM TERM: uptrend

When this uptrend began about five weeks ago, we initially set an upside target between the 1956 and 1973 pivots by the first week of March. Now in the third week of March, and at SPX 2050, we obviously underestimated the strength of this advance. This has caused some to doubt the bear market scenario, and some hardship for others. While we always aim to do our best, there are times when we just get it wrong.


We continue to maintain the same count we posted last weekend: Int. A SPX 1947, Int. B SPX 1891, and Int. C so far 2052. This uptrend still looks like a 5-3-5 zigzag, with the fifth wave of Int. C still underway SPX: 1963-1932-2009-1969-2052. With Minor 3 (77 pts.), exceeding Minor 1 (72 pts.), Minor 5 can be any length and it has already exceeded both (83 pts.). The key level to watch going forward, to potentially break this pattern, is Thursday’s low at SPX 2022. A drop down to that level would technically confirm the five wave pattern has ended. Medium term support is at the 2043 and 2019 pivots, with resistance at the 2070 and 2085 pivots.


Int. C of this Intermediate ABC Major B wave uptrend, has created a nice rising channel noted on the hourly chart. Here the lower trend line break also appears to be around SPX 2022. This entire uptrend, in fact, looks similar to the October uptrend too. Then the market advanced 244 points in five weeks. This uptrend has advanced 242 points in five weeks as well. Something to keep in mind.


Short term support is at the 2043 and 2019 pivots, with resistance at the 2070 and 2085 pivots. Short term momentum ended the week with a slight negative divergence. Best to your weekend, and trading next week!


Asian markets were mostly higher for a net gain of 1.8%.

European markets were mostly lower for a net loss of 1.0%.

The Commodity equity group gained 2.3%.

The DJ World index is still in an uptrend and gained 1.4%.


Bonds continue to downtrend but gained 0.8%.

Crude continues to uptrend and gained 6.9%.

Gold continues to uptrend as well and gained 0.4%.

The USD remains in a downtrend and lost 1.2%.


Monday: Existing home sales at 10am. Tuesday: the FHFA housing index. Wednesday: New home sales. Thursday: weekly Jobless claims and Durable goods orders. Friday: Q4 GDP (est. +1.0%).

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

About tony caldaro

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583 Responses to weekend update

  1. The post below was accidentally posted on the March 19 Weekend report instead of the March 26 Weekend Report

  2. On Thurs, Feb 11 and Fri, Feb 12 I made posts stating that Primary 4 had just ended and Primary 5 would soon begin, if it hadn’t already. Over the President’s Day weekend I wrote a long technical article explaining my reasoning and posted it on this site on Monday, President’s Day. So far I have been proven correct to the extent that the subsequent rally has been much stronger than most expected. The final proof will only come when the S&P 500 decisively exceeds 2135. But let there be no mistake: I am the first one on this site to have written that Primary 4 had ended and that Primary 5 was kicking off, and supported my opinion with my own research and analysis. If the SPX does not make new ATH’s, then I am also on record as having made a prediction that failed to come true. With Tony’s indulgence, I am posting that article again as it appears on my blog, the unravellersspool@blogspot.com (Google). The writing was cleaned up slightly to convert it from a post to a formal essay, but all the material facts and theories presented are the same.

    “The decline to Feb, 11 low at an intraday SPX price of 1810 and a closing SPX price of 1829 from the all time high of 2135 from the May 18-July 20 double top at 2135 and 2128 respectively was more appropriate in time and extent for a Primary degree down wave than the decline to the 1867 low or even the 1872 low were. A broad A-B-C pattern was etched out by the Primary 4 down wave. The A leg divided into an a-b-c starting from the July 20, 2015 top at 2128 and ending at the Aug 25 low of 1867. The b wave starting from 1867 divided into a 1-2-3 topping at 2021 on Sept 16, 2015 with the c-wave ending at the Oct 29 low of 1872 in a single wave decline,creating a double bottom.
    From there a strong B-wave rally took the SPX to an eventual peak at 2081 on Dec 29, 2015. The double top pattern created by the Nov 3, 2015 and Dec 1,2015 highs of 2116 and 2104 respectively were the absolute highs of the rally. That could have been called a 5-wave rally with the 4th wave dividing into an a-b-c and the 5th wave peak at 2081 failing on Dec 29, 2015 to even match the Dec 1 high. From the Dec 29, 2015 peak of 2081 the C wave fell to 1810 (intraday) on Feb 11, 2016. The a wave hit it’s low at 1812 on Jan 20; the b-wave peaked at 1947 on Jan 29; and the c-wave probably ended on Feb 11 at 1810. The large A-B-C pattern consists of the Major waves of Primary 4. The anomaly in this wave pattern is the 5-leg B wave which ended in the “failed fifth” wave on Dec 29, 2015. According to Elliott Wave theory, a corrective upwave is supposed to take a 3-wave form. But at the time it was happening, it was believed by many of us to be Major 5 of Primary 5. For the market to maintain that deception it had to deviate from the orthodox pattern, only appearing as a corrective B wave (to me) in retrospect.

    The up days in the bottom forming action in the week of Jan. 18-22 featured a couple of days with the A-D line above +2000, one of which was a +2400+ day. This was a harbinger of further strength in the Fri, Jan.29 rally to come. The Friday, Feb 11 rally was not as strong as the Friday, Jan. 29 surge which at the time I thought was the beginning of Primary 5, but if there is follow through, it will prove more sustainable. Then Feb 11, 2016 would mark the low of Primary 4.

    It is true that the DJIA closed 6 points below it’s August lows while the DJ Transports have long since fallen below their Aug lows. So there is plenty of justification for calling today’s action a Dow Theory sell signal. However, recently the Transports have strengthened and today they closed 200 points above their Jan 20 lows. Picking the appropriate points to compare is a kind of art whether it is the Dow Theory or any other set of indicators that are used in conjunction. I think I am on firm ground in saying that there was a short-term DT non-confirmation to the downside by the DJ Transports. The downside penetration by the Industrials was very marginal as well. However, strict Dow Theory rules state that any closing price above or below a previous level, no matter how small, counts as a penetration. In my opinion, the Dow Theory Transport (Rails) and Industrial confirmations or non-confirmations are the original ancestor of all the myriad index and indicator divergences and confirmations that are used today.
    The Dow Theory is based on closing prices, The DJIA fell below it’s Oct, 2014 lows in Aug, 2015. The DJTA did not fall below it’s Oct 2014 lows on a closing basis in Aug, 2015. That is the reason why there was no Dow Theory bear market signal, not because of the flash crash. Subsequent to the Aug 2015 decline, the DJIA rose to new highs. The DJTA failed by a wide margin to do so. On Dec 18, 2015 the DJTA fell below it’s Aug, 2015 low but the DJIA did not do so by a wide margin.
    There were declines prior to Aug, 2015 that some Dow Theory practitioners may have used as reference points and thus generated a bear market signal. But I consider the Oct, 2014 lows to be the correct ones to look at for comparison. From what I have read, I would say that most Dow Theorists interpret the price action from Oct 14, 2014 to mean that the Dow Theory has signaled a bear market. But obviously I have an interpretation contrary to that.

    The NYSE daily A-D line fell below it’s previous low but the NYSE McClellan Oscillator held well above it’s previous low of -89 by rising to 58.6 and then halting it’s last decline at about -43.5, thereby creating an uptrend. If the NYSE McClellan Oscillator can climb above 60 and then hold above 0 on any pullbacks, that would amplify the nascent uptrend in the NYSE Summation Index, which fought it’s way up to -575 from a low of -800, and now appears to be making a higher low at -668.


    The severe decline in the NASDAQ and in secondary stocks served to revalue growth stocks and generate some sector rotation, possibly in preparation for finding new leadership in the next, and perhaps last phase of this bull market. The NASDAQ daily A-D line fell even further below it’s previous low than the NYSE A-D line. Subsequently the NASDAQ McClellan Oscillator rose from a low of -86 to +58.6, and then fell to a higher low at -33, and has currently risen to the 0 level.The NASDAQ Summation index looks to be making a double bottom in the 4292-4313 area. Of course, to kick the NASDAQ Summation Index into an uptrend, the NASDAQ McClellan Oscillator needs to move above 50 and then stay above 0 on any declines.


    If both of these Summation indexes can generate durable uptrends, that would be strong evidence that the bull market has resumed rather than just a counter-trend rally developing in a bear market .

    From a psychological point of view, I would say that the market has been trying to convince it’s players that any forthcoming rally is only corrective in nature, not a resumption of the primary bull. Most of the so-called bullish forecasts I read are only anticipating a counter-trend rally to the upside within a primary bear market. The bull needed to throw off some of the people who were riding it, especially on credit, with too much of a sense of equanimity. Although there some who agree with my position that Primary Wave 4 ended on Feb 11 at 1810 (intraday) or will end soon in this same price area, I think there is a great deal of fear that this is a bear market and it will resume it’s destructive path downward after the upward reaction burns itself out. I feel quite a bit of fear myself and am not overconfident about this position that I’ve taken.”

  3. llerias7 says:

    bullish breakouts all over…
    it may revert but soon or Later this should play out!…

  4. ok my 2060ish target is now touching distance- it may have down by couple of points as the trend line has move down. the sooner we can hit it we can then move on i can this board is becoming like election rallies of trump. and Samba wtf is your problem, you can be a smart azz if you want to without belittling others specially the sisters here.

  5. bhuggs52 says:

    Thanks Tony, for all your effort. I hope the recent squabbling hasn’t dulled your inspirations. I gladly wait your Monday update. Cheers brother!

  6. cosmos77 says:

    Based on Tony’s 60 m chart, I am waiting for this minor fifth of int c to complete. Looks to be in minute 3 which might have topped today. We should get a 10 to 20 point pull back for minute 4 then minute 5 wave of int c should put in a decent top. Maybe at Fiona’s 2070. The Rut looks very week and put in a doji today, which might be all for the RUT.

  7. I thought for a second, we might close red, then I realized I was over due on taking my meds.

  8. phil1247 says:

    2054 spx hit…..maybe thats all she wrote….
    pop and drop turnaround tuesday at 2058?

  9. simpleiam says:

    I think GTO’s Feb Queen video yesterday is very accurate. There is what seems to be multi-layered resistance, one atop the other, until almost 2060. Market needs to do one of it’s favorite dance moves, which it’s become famous for: The Gap Up Open.

    Roll that beautiful bean footage, and Archie Bell!

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