Tuesday update

SHORT TERM: quiet open then selloff, DOW -181

Overnight the Asian markets gained 0.9%. Europe opened higher but lost 0.2%. US index futures were choppy overnight. At 8:30 the CPI was reported higher: +0.4% v +0.1%, Building permits were higher: 1116K v 1086K, and Housing starts were higher: 1172K v 1089K. Then at 9:15 Industrial production was reported higher: +0.7% v -0.6%. The market opened four points below yesterday’s SPX 2067 close, then declined to 2057 by 10:30. After a rally back to SPX 2063 by 12:30 the market headed even lower. At 3:30 the market hit SPX 2041, then bounced to end the day at 2047.

For the day the SPX/DOW lost 1.00%, and the NDX/NAZ lost 1.30%. Bonds lost 5 ticks, Crude rose 80 cents, Gold added $3, and the USD was flat. Medium term support remains at the 2043 and 2019 pivots, with resistance at the 2070 and 2085 pivots. Today the Atlanta FED lowered the Q2 GDP estimate: +2.5% v +2.8%. Tomorrow: FOMC minutes at 2pm.

The market opened lower today, dipped to SPX 2056, rallied back to the opening level, then sold off to Friday’s lows. Looks like Monday’s rally was a one day wonder. Still a few possible short term counts from the recent SPX 2085 high: three waves down to SPX 2043, one wave up to SPX 2072, and now another wave down to SPX 2041. It appears overnight action should determine whether or not the market rallies back to the 2070/2085 pivots, or breaks the current downtrend low at SPX 2039. Short term support is at the 2043 and 2019 pivots, with resistance at the 2070 and 2085 pivots. Short term momentum dropped from quite overbought yesterday to quite oversold today. Trade what is in front of you!

MEDIUM TERM: downtrend probable

LONG TERM: bear market

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

About tony caldaro

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246 Responses to Tuesday update

  1. simpleiam says:

    How about that pivot! Broke the area ever so slightly, and now popping back up. Has been doing this sort of thing for months. GL All!

  2. $VIX up 5% and UVXY up 1%. What is that telling us?

  3. H D says:

    Typical Whipsaw Wednesday, massive volume spike SPX 20(55), took them 2 hours to figure out how to unwind it, found 20(34) SPX and bounced back to HWB. All the proof you would ever need for a rigged BOT market. Stay thirsty and think like a BOT, there’s more of them then us.

    • H D says:

      oh, was there news today?

      • tony caldaro says:

        news? yes
        the FED is about to tank the economy and the banks rallied 😉

        • simpleiam says:

          Auntie Janet now ready to PUSH everyone into spending. Figures if a hike is expected every 6 months, people will be out in force this Summer before rate goes up again. Guess she was too ugly to be a Weather Caster on TV, so took Federal Reserve job instead.

        • Holly Silver says:

          At rates so low that it is barely visible? The banks NEED rate hikes to make money. Not only will they rally but will be the beat performers by end of year. Follow Buffett and you can’t go wrong. he knows nothing about high tech but everything about financial institutions. I already stated the dollar will strengthen and 10 year not will rise from here. Gold I predicted will fall hard as a result of the above. My only holdout is stocks. Write this one down. It will surge very soon. Has to. Economic expansion after the long winter (14 to 16 months) will prevail. heck it took so long in getting it started it will build on its own momentum. The end game for this bull market is when we see clear skies and rate pressure pushes us over. No where near that yet. in fact 200 basis points might not be there. Money will flow straight into stocks from here. Watch the cash flow.

          Next 2 days we should see on average 25 SPX move each day till Friday’s close. How sure am I? Give it 75 percent chance. If wrong about this then I am wrong about my Macro argument from 6 years ago. I am truly excited. the market closed exactly as it should. 21st day on SPX slightly down. Q’s had their 21st day yesterday and rose today.
          It would be very rare to see the market drop after the 21st day of a slow trickle.

          Anything’s possible but when I see the market behaving my way I have a tendency to go on long streaks of correct calls. Just the way it has been for decades. Gold crashed when I said it would simply because the math made sense. Had to see a strong dollar when the FED announces rate hikes. Had to see 10 year note rise.

          The news was good not bad for the market. It means a step towards normalcy, less dependent on Fed propping the markets up. You expect when Fed Funds Rate is at 1950’s levels? I expect the street to see it my way for now.

          Making this proclamation to you because of how strongly I believe I am right. My opinion and bets are out there. Hard to face if wrong but I’ll take that chance.

          • simpleiam says:

            You’re so full of it, Holly. You really are…

            • phil1247 says:

              simple …you are a breath of fresh air

              glad u r here

              • simpleiam says:

                Thanks phil. Just when things are relatively peaceful, she comes here and rants. We don’t need that. Wish ALL would leave her alone. Just don’t talk to her! I don’t know, maybe she’s off her meds. Whatever.

          • CampFreddie says:

            Holly, Good post thnx, and I agree.

          • CB says:

            Good point about the banks and the yield curve, Holly . JPM has just raised its dividend yesterday citing the effect of higher rates on their business….. Citibanks’ chart…pretty telling as well today…
            Holly, don’t let simple walk all over you 🙂 With her grandiose and nasty comments she’s obviously representing only herself. Some people just bs all day long and try to interrupt those who actually trade. Sometimes you just need to get a fly swatter, Holly :)… GL

        • H D says:

          Tony, Trump’s gonna fix it all, FED, Dodd Frank, banks happy?

    • phil1247 says:

      amen my friend…

      stay thirsty!

  4. phil1247 says:


    just to show you how nefarious DA BOYZ are with their algos……

    at 1:59 the es 1 min bar closed below the ext long at 2053.75

    at 2:00 the next 1 min bar hit 2045.50..

    they always handcuff you at the key level at the key time so only they can make money

    • fotis2 says:

      See that only cause you pointed out am trying to work out how this guy plays the Market beause im totally out of touch on how you place your trades and targets seems a combination, fibs, resistance, support and and breakouts?

      • phil1247 says:


        spend some time watching the videos every am….you are up early

        its very confusing at first but DH keys you in to where the algos are written to execute just doing fibs at highs and lows doesnt work all the time

        BOYZ write algos that ignore certain levels so it looks crazy sometimes

      • simpleiam says:

        fotis, if you don’t mind me saying, the pivots are the first thing you should consider. Second, learn the fib retracements. You can pretty much trade using these 2 technicals, and little else.

  5. if you cant break it join them, close green

  6. vivelaamo says:

    Weeeeeeeeeee 😄

  7. phil1247 says:

    guess what ?

    after all that …..bearish below 2047es again…..

    as if nothing happened

  8. mcgcapital says:

    Oil coming off now, Brent reversed from $50. This does change things… Commodities could come under pressure again. The economy isn’t that strong but they need to hike as inflation ticks up. If we see follow through tomorrow it could be a big move down ahead. That fractal from August still looks relevant.

  9. Seems like a sharp break is building up to me ! I went short yesterday late in the day and I am willing to hold here for a massive breakdown (if I’m right). I think 300 points down on the DJIA

  10. captbara says:

    XLF 50% retrace for the day.

  11. Dex T says:

    Fed targets June for possible second rate hike

    “Fed officials decided against raising rates at its April meeting. But minutes of the gathering showed that there was a widely held view that it “likely would be appropriate” to raise rates at the June 14-15 meeting as long as the economy and labor markets continue to strengthen and inflation shows signs of accelerating.”


    • Dex T says:

      The Fed Futures is now expecting a hike in June so the market believes them.

      Another 0.25% increase on the way.

  12. phil1247 says:

    es 2027 target

    then 2013

  13. Holly Silver says:

    WOW! Didn’t expect the strong language. They seem very anxious to raise rates. looks like they see higher expansion ahead. Sure does negate the recession theory. As for the market I think it will hold very nicely above 2040 for the 4th time. if it does I roll over Call to next week.

    BTW SP500 is in the 21st down day while Nasdaq had theirs yesterday. that suggests Q’s up at end of day and SP500 flat or slightly down.

    Very strong TELL today. if the concern for rate hikes in June is taking hold then the market will not hold today. Above 2040 and we have a strong rally afterwards. Implications are that the street views higher domestic economic activity more than the 25 basis point move.

    Exciting times! Bet the bear if it breaks down today. bet the Bull if it doesn’t. This should be the launch for next big move.

    Happy trading everyone……..

    • Holly Silver says:

      BTW there goes GOLD. the easy bet. Strong dollar and higher bond yields a double whammy for Gold which is so thinly traded. Expect a washout event by this Friday.

      SP500 temporarily broke 2038. Cascading event or rebound? No idea…..

    • ewtoriginal says:

      Nothing to do with recession etc. Normalization and credibility.But nothing has happened yet from this Fed. Its talk. For now, the market sinks in the Halls Of Bury.

      • Holly Silver says:

        Implications. Work it out as I have the Gold scenario. made multiple long shot bets on Gold and a small one on SP500. The economy is definitely heating up to a point not seen in 7 years. The FED is telegraphing their anxiousness to start the process of normalizing rates. As a business owner tell me which is more important at this zero rate environment, rate hikes of 25 basis points and accelerated spending or no rate hikes and the same old malaise in the economy? no brainer. the street will see this and rather quickly.

        I give the odds of SPX hitting 2090 by close of next week at 75 percent. If we fall off the cliff today all bets are off.

        Imagine after 14 or 16 months of bad news and not traction we are seeing strong signs of a reversal. now imagine the street ignores this and decides to go into a secular bear for an extended period of time. Makes no sense. Sticking to my guns here simply because the logic is too strong to ignore.

        If I am right the market will already be adjusting their thinking today. I expect a mild lower close or even a possible higher one.

        • ewtoriginal says:

          “I give the odds of SPX hitting 2090 by close of next week at 75 percent”
          Good luck. I give it 12%. And you are still confusing inflation being calibrated to the media in a way that looks like growth or inflation previously understated, which is my contention. Wage inflation? Nope. Price inflation? Huge and understated. Rent,health care and food.Up a lot for a long time.

  14. simpleiam says:

    Needs to break below 2036 to bust this pivot.

    Looks like Auntie pays attention to the weather. Smart Girlie!

    • simpleiam says:

      So far got the Trend. Looking for counter trend pop, if any, then, trend back down, IF this works as it usually does. All within about an hour to 90 mins.

  15. FED rate increase still on the table….yup,the Christmas table.

  16. Bob Sagget says:

    CNBC – the perpetual cheerleader (compare 1 to 2)

  17. Dex T says:

    Wow!, S&P took a 10 point dive in seconds…with some follow through haven’t seen that in a while!

  18. ewtoriginal says:

    Fed buying vix calls and spy calls to hedge…all purchased on Amazon through Prime memberships

  19. Bob Sagget says:

    We are off an running boys and girls!

  20. stmro says:

    I think I figured opex out. Buy if prior day was red, sell if prior day was green. Easy money ;).

    Seriously though, whilst people are frustrated with the choppy action (myself included), we’re still making lower lows and lower highs. Bulls need to break 2073 to change that and that’s through the middle bb.

  21. simpleiam says:


    Other than this site, Fed has a site you can watch too. I’m not in front of TV, so have to wing it.

  22. 123 abc says:

    May appear the bearish Gartley pattern is back underway…

  23. johnnymagicmoney says:

    hmmmm – again market is overbought on the hourlys at lower prices. Hmmmmm maybe my rant was premature =)

  24. phil1247 says:

    dumping half my BOND shorts here

    maybe ripe for counter trend rally soon

    TBT… sold at 36.70

  25. simpleiam says:

    Remember that 2070 pivot area extends as low as 2063. Let’s see if Fed will blast us through it, or elevator drops. GL All!

  26. TMF says:

    Market set up for a BIG rally…

    Put/Call favors rally
    Almost EVERYTHING is on support around 50dma’s
    The bots see the H&S top, this means it won’t happen
    XLF close to breaking correction downtrend
    Apple needs to test $100
    risk areas like SMH, small caps leading

    Good Luck Bears ! This correction is almost over and it will be 2 of P5 (if it lasts a bit longer) or 4 of 1 of P5….


    • fionamargaret says:

      AAPL and FAS are working today…..good stuff TMF

    • ewtoriginal says:

      The Pavlovians all bought expecting another BTD low and bid them up although the markets knew for some days that the clowns at the Fed were talking about hiking. Of course they wont. But market is volatile and a bit lower. Here are the minutes following the June meeting ” The committee has held rates at .35%. The risks to the retail market from consumer spending has once again scared us into sitting tight.” Look it up online now. June 2016.

  27. Are these minutes THAT big a deal?I see position squaring in the dollar and gold/silver,but what can anyone gain from the April meeting we don’t already know?Data dependentthey say–including China,EU.Not just US economic indicators that the Fed uses anymore (as an excuse for not raising,basically).

    • ewtoriginal says:

      The minutes were released days ago.Now they tell the rest of the world what “THEY” read.

  28. Holly Silver says:

    What good is the 5 billion possible trend expectations when everyone is reading the same chart and using the same EW method? I’ll stick to what works for me. I thought I could gleam some new insight but obviously not. Anyone that loves patterns how about the 3 year pattern on the 10 year note. Sure looks like the wedge pattern is firm and so is the possible breakout defined. It looks like classic basing to me. Fits in with my assumptions on a surge in economic spending and growth.

    Crossing my fingers on this set of bets. Expecting a huge drop in Gold regardless of how the equities market reacts. I did combine the bet with SPY calls. Don’t trust the 12 point move in SP500 right before news breaks. Should have wild swings as in the not to distant past when they announce. Will shut my eyes and wait till it settles down.

    • johnnymagicmoney says:

      ZIRP works Janet ZIRP works !!

    • simpleiam says:

      “What good is the 5 billion possible trend expectations when everyone is reading the same chart and using the same EW method? I’ll stick to what works for me. I thought I could gleam some new insight but obviously not. ”
      Excuse the hell out of us…

      “Crossing my fingers on this set of bets. ”
      Real T&A analysis if I ever heard it!!!!

  29. phil1247 says:

    squeeze continues…next station……..2068 /ES

  30. captbara says:

    Yen currency pairs sporting triple, quad daily positive RSI divergence, also on weekly except for USDJPY.

  31. Scott C says:

    Can I ask those that are bearish are you expecting to cover on the 2019 pivot whenever the hell it shows up or are you now looking for a big selloff into 1800? I have been holding this stuff so long and am a little sick over it, Many are seeing low 2000, wondering if we can unwind past that or wise to cover and reload…

    • mcgcapital says:

      Let’s see what happens when/if 2040 breaks. A drift down without follow through would support covering but a heavy volume powerful move would be worth holding. The only data points we have on a move through 2000 from above are October 2014, December 2014, January 2015, August 2015, September 2015 and January 2016. 4/6 of these swiftly moved sub 1900, the other two bottomed 1970-90. If Tony plus other analysts are right I’d expect it to go straight through but let’s see how it looks when we get there.

      • Scott C says:

        Thank you for the data points and approach. should have sold yesterday and reloaded today in hindsight.

    • ajaysinghi says:

      1800 will break within 3 months. Have patience.

  32. johnnymagicmoney says:

    I hate to say it but the delusion of this market is astounding. Doesn’t matter what the minutes say. They are going to twist it in a positive spin – period. Rates higher? Oil should be down right? No Banks will just make gobs and gobs more with rates up another .25% right? Not really but lets believe that for a bit. Oh and Warren bought Apple (well not really Warren) at 109!!! Great buy!!! Its at 95!!!!! But lets give a big fat cheer for Warren being down 15% on his billion! BUY!!!!! Oh and the economy is growing so fast and raising rates is great! Oh but if the minutes come out dovish then that’s great too!!!

    Bottom line is market held at 2040 (AGAIN) and this needs to form an even longer and more excruciating rounding top before the fall. It just isn’t ready to roll over and die. Markets will be up towards 2075 range again today. Oh well.

  33. Because things seem to have calmed down here a bit with regard to spam posters, I will again post an intraday chart and see if it can be kept civil. This one is of the S&P500 hourly. B, B Triangle or B Flat, all still possible. B waves can be quite unpredictable.

    SPX - Hourly - May-18 1242 PM (1 hour)


    • (c) of b should be one bar to the right .. sorry .. the marker moved by accident.

      • Jack Sparrow says:

        why cant this be e going up now and d is where you have b, and d just overshot a bit- does this violate the rules?


        • .. because c of (b) was counted as ‘five clean waves up’, and therefore, it can not alone be a leg of a triangle. All triangle legs are zigzags .. or internal triangles .. themselves. Also bj100 .. one of the better wave counters here .. also counted the down movement as a flat; the one shown as (a), (b), and (c) of circle-b. Hope this helps.

    • .. a few things to remember .. 1) a triangle is a pattern which must ‘prove’ itself .. with every wave in place. 2) a triangle can not be ‘called’ until all five waves have formed properly — until then, it is only a ‘possible’ triangle. 3) There is an upcoming FED announcement, and the market tends to go a bit crazy on them, so the c wave of a FLAT instead of a triangle could easily extend above the circle-a wave — to 2080 – 2100, if it wants. 4) there ‘was’ a diagonal down to minor A; this is already validated by lower lows on the DOW; there is no reason it couldn’t have a deep retrace if it wants. 5) If a triangle ‘should’ form properly, remember that a barrier triangle is defined by it’s a – to – c trend line on top. We currently don’t ‘know’ where c is (circle c); it could break above the (b) wave in a fake out – which is common in a triangle, but stall below (c) of circle-a. 6) triangles are rarer patterns than FLAT; which ups the odds the flat a bit, but makes neither impossible.

      This is the honest-to-goodness Elliott Wave rationale why B waves are unpredictable. A barrier triangle and a FLAT same out with exactly the same internal waves. The only thing we can say is a FLAT ‘must’ have a clean ‘five wave up’ structure for the c wave (circle c) of minor B, and it “should” make a higher high than circle-a.

    • Igor says:

      Thank you TJ.

    • blackjak100 says:

      So far this looks correct

  34. Moving averages are in bearish configurations on the daily, 60 min time frames, and weekly;9 below 20, 20 below 50, 50 below 200.
    Can’t say whether Primary 5 or not, but TA shows very weak market

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