Wednesday update

SHORT TERM: gap up opening, DOW +187

Overnight the Asian markets gained 2.6%. Europe opened higher and gained 2.6% as well. US index futures were higher overnight, and at 8:30 Retail sales were reported lower: -0.3% v -0.1%, and the PPI was reported lower: -0.1% v 0.0%. The market gapped up at the open to SPX 2073, and continued to rally. The SPX had closed at 2062 yesterday. At 10am Business inventories were reported lower: -0.1% v 0.0%. By 11:30 the SPX hit a new uptrend high at 2080, pulled back to 2074 by 1pm, then moved even higher. At 2pm the was released. Heading into the final hour of trading the SPX hit 2083 and then dipped to close at 2082.

For the day the SPX/DOW gained 1.05%, and the NDX/NAZ gained 1.45%. Bonds gained 2 ticks, Crude lost 65 cents, Gold dropped $13, and the USD was higher. Medium term support rises to the 2070 and 2043 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow: weekly Jobless claims and the CPI at 8:30, then Senate testimony from FED governor Powell at 10am.

The market gapped up at the open for the second day this week, then hit a new uptrend high within the first half hour of trading. This uptrend continues to extend. From Thursday’s SPX 2034 low we can now count three waves higher: 2061-2040-2083. Since all rallies during this uptrend have been five wave structures we would expect a pullback at some point and then a higher high. Overall, the uptrend now has seven significant waves: 1947-1891-2057-2022-2075-2034-2083 so far. This suggests a corrective pattern at this point in time. However, the strength of the uptrend has certainly forced some capitulation. Short term support is at the 2070 and 2043 pivots, with resistance at the 2085 pivot and SPX 2104. Short term momentum is displaying a slight negative divergence. Trade what’s in front of you!

MEDIUM TERM: uptrend

LONG TERM: bear market


About tony caldaro

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398 Responses to Wednesday update

  1. mrtraderguy says:

    I am looking forward to more of RC’s charts tonight, as I suppose, are most of you.

  2. johnnymagicmoney says:

    who wants to bet that the market closes a smidgy above yesterday’s close

  3. randomacts4 says:

    Question: Someone periodically posts here under the name of ‘Market Analyst’, and he runs a site called I’m curious if anyone here has bothered to investigate it or has perhaps even subscribed to it. Your thoughts and input would be most welcome, thank you.

  4. mrtraderguy says:

    Relentless drip, drip, drip higher. Destroying all bears with fake top after fake top. Eventually someone will nail it.

  5. And anyhow, I wouldn’t want to go home this night in any long. The top could happens overnight

  6. nsteve24 says:

    do we get a Green major b at 2087.84 posted at the close?
    no reason why not, it’s just as good if not better than all the others

    • johnnymagicmoney says:

      he’s waiting for some impulsiveness down first. Computers controlling still. I just find it fascinating that the programs are still on. At some point don’t the big boys say man we’ve made a lot here time to go the other way lol Max pain I guess first.

      • nsteve24 says:

        waiting for Godot

      • Bob Sagget says:

        M1 (Money Supply) keeps rising. It was thought to abate when QE ended but that did not happen. So long as M1 keeps expanding the Primary Dealers have the liquidity to keep the machines / algos running.

        I wondered why the indexes dropped in January and February 2016. I am no expert but I read an article about how the markets enter epileptic mode each time a new Fed Reserve Chairman is appointed as a form of “Hazing.” This coupled with Yellen’s “4 rate hikes in 2016” rhetoric was another good reason for the indexes to retreat in revolt. Finally, perhaps in January / February 2016 there was still some mystery as to whether Hillary, the street’s preferred POTUS, would be elected. Now it is likely much clearer.

  7. johnnymagicmoney says:

    when will the big boys turn off the damn computers and start hurting the bulls for god sake???? This low volume btd is refriggindick

    • nsteve24 says:

      can imagine the Banks trading desks profits are crumbling these 1st 2 weeks of Q2, have to assume they’ll want that changed soon

  8. Still in the 4th or more correctly the B of C. Still need a firework wave up

  9. fotis2 says:

    Aha! I’ve got it worked out now when its going up you must be long and when its going down go short that’s it folks easy peasy…by the way SPX 2034 on the 7th 2088 TODAY..

  10. johnnymagicmoney says:
  11. phil1247 says:


    ending diagonal finished?

    if so look for sharp move tp 2074

    sound familiar??

  12. ajaysinghi says:

    Spx expiry tgt 2095

  13. ogdenfripp says:

    After reading all the predictions since market open today, especially the bearish hopefuls looking for a minor wave 4 type, 15 to 20 point correction from SPX 2080-85, (including my own call a few hrs ago) ……….. it looks like it just doesn’t want to happen. After a lifetime of betting (including trading), I just keep having to remind myself that ‘money saved is money made’ which in this place and time of the market, forces me to just wait for SPX 2100 to arrive. I like Colin Twiggs’ update today based on straight forward good old garden variety TA ………..” The market is headed for a test of resistance at 2100 after “upbeat” results from J P Morgan (JPM). 13-Week Momentum is rising and breakout, while unlikely, is possible”. Even if the pullback does look like happening it’s not worth it … I’ve been stopped out so many times this last fortnight’s relentless rally trying to trade the reversal.

  14. Page says:

    Those who are shorting Gold and hoping for 1180, 1160, 1130 etc. they will be disappointed, Gold will not drop below 1200. I am watching it closely and will initiate position in Gold around 1200 if it gets there. SPX pullback begins tomorrow. WTI is heading towards 50.

  15. Millan Tomic says:

    BJ has shown the NY AD line making ATH few days ago. However, i usually show NY AD Volume and it is way below ATH. Participation is less than enthusiastic which is fruitful avenue for gentle squeeze higher. Thing is stocks are way more expensive now since EPS are way off but they can always become more expensive if investors do not shift to risk aversion. As previously written, USD is the key and so far FED had navigated this well as USD has been consolidation, Critical levels at hand and ECB and BOJ coming , so let see how this play out. There is a rising scenario this goes to a bubble top

  16. No exhausting, no shorting…. Existing and yes, shorting

  17. johnnymagicmoney says:

    Hey ABC maybe 2078 was 4 and your target 2089 was 5

    Intermediate-c (Impulsive Five Waves)…

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