Friday update

SHORT TERM: decline continues, DOW -57

Overnight the Asian markets lost 0.5%. Europe opened lower and lost 2.3%. US index futures were lower overnight as well. At 8:30 Personal income +0.4% v +0.2%/spending +0.1% v +0.1% were reported higher and PCE prices were reported higher: +0.1% v+0.1%. The market opened five points below yesterday’s SPX 2076 close and continued to decline. At 10am Consumer sentiment was reported lower: 89.0 v 89.7, and the Chicago PMI was reported lower: 50.4 v 53.6. The market hit SPX 2060 at 10am, rallied to 2069 by 10:30, then headed even lower. After hitting SPX 2053 at 11:30, the market rallied to 2063, then declined to 2052 just past 2pm. After that the market rallied to SPX 2069 before ending the day/week/month at 2065.

For the day the SPX/DOW lost 0.40%, and the NDX/NAZ lost 0.55%. Bonds gained 2 ticks, Crude slipped 5 cents, Gold rallied $24, and the USD was lower. Medium term support drops to the 2043 and 2019 pivots, with resistance at the 2070 and 2085 pivots. Today the WLEI was reported higher: 54.5% v 53.5%, and the initial Q2 GDP estimate was reported at +1.8%.

The market opened lower for the third day in a row. But unlike the past two days when it rallied shortly after the open, it continued to declined for most of the day until the last two hours. It is possible the current central bank QE holding pattern has taken the tail wind out of this uptrend. Also, the Nasdaq has now declined for seven days in a row, and is very close to confirmed a downtrend. Last weekend we mentioned three important levels for this week: 2111, 2074 and 2034. The market only managed to hit SPX 2100 on Wednesday before taking out 2074 on Thursday. More on this and others in the weekend update. Best to your weekend!

MEDIUM TERM: uptrend weakening

LONG TERM: bear market

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

About tony caldaro

Investor
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88 Responses to Friday update

  1. fotis2 says:

    CN has demonstrated what seperates a good trader from the rest.While the majority, myself included, have been trying to call a top from the 1980s CN patiently waited for his Big Down setup to occur, waited some more for it to trigger,entered his trade,placed his stop and is waiting patiently for said trade to play out.Now if the trade works out or not is not important what is important is CNs system has a 80% succes rate(This is based on previous comments of trade setups and triggers that CN has posted- before the fact-over many years) and manages to squeeze out the most of what the Market gives for the least of risk..There is a minority who have been riding the long side since the lows Gto, BG and Holy come to mind and Kudos to them..

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  2. kvilia says:

    I just wonder about one thing – if the damn market can gap up in the morning instead of gapping up so I can short the hell out of it.
    Have a good weekend.

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  3. Here is how the Nasdaq Composite resolves into five waves up in the much simpler manner I had mentioned earlier. Just like all the other indexes. It took a while and some study to find it. But the five count can be resolved. The overlaps were just a clue there was a diagonal in there somewhere. It was a perfect ending contracting diagonal, not an expanding one. And so it likely indicates the up count is over at least for a time being. And now if wave 4 is exceeded lower, it will prove out the contracting diagonal instead of invalidating the potential expanding diagonal.

    Again that means the major indexes can be resolved as Primary V or Intermediate (1) of Primary 5.

    COMP (120 Min)  4_29_2016a

    TJ

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  4. Jack Sparrow says:

    I have noticed one thing about this board, everyone here is a 30 year veteran of trading whenever there is a heated discussion it turns out both sides have been trading for 30 years by this benchmark I am just an newborn but I do have a high IQ. Now I am waiting for Fiona and Page to use a 30 year line that will be the day I’ll become a bull for eternity.

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  5. learnedmylesson25 says:
  6. hooloo1957 says:

    I was wondering if anybody has any more information about Mercury going retrograde. Seems to have caught these last two moves extremely well

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    • Dex T says:

      Mercury is retrograde until May 22- and you should normally leave anywhere from a few days to 1 week on either side of it. There are many astrological sites that will provide you with in depth info about this phenomenon.

      It is not always associated with large market drops but causes things to go “haywire” so market drops do occur.

      In 2008 the market rallied right through May-when Mercury went retrograde the rally ended

      Mercury was also retrograde during the initial 2011 drop- in August of that year.

      As with any indicator it’s not 100% but is something to be aware of because it helps to quantify changes in emotions/social mood.

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  7. rd3777 says:

    I would be surprised if the Dow Monday would not “break” lower. The price action clearly impulsed through the neckline and made a feeble attempt to rally back to the NL…a sign of weakness and then started to impulse down again @ the close..

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