Wednesday update

SHORT TERM: FED rally fades, DOW -35

Overnight the Asian markets gained 0.7%. Europe opened higher and gained 1.1%. US index futures were higher overnight. At 8:30 the PPI was reported higher: +0.4% v +0.2%, and the NY FED was reported higher: 9.0 v -6.0. Then at 9:15 Industrial production was reported lower: -0.4% v +0.7%, and Capacity utilization as well: 74.9% v 75.4%. The market opened 5 points above yesterday’s SPX 2075 close, then moved up to 2084 just before 10:30. The market then pulled back to SPX 2079 by 11:30, before drifting back up again ahead of the FOMC statement, report and press conference. At 2pm:, and The market initially rose to SPX 2086 after the news, then pulled back to 2070 just before a 2072 close.

For the day the SPX/DOW lost 0.20%, and the NDX/NAZ lost 0.25%. Bonds gained 13 ticks, Crude slid $1.00, Gold rose $9, and the USD was lower. Medium term support remains at the 2070 and 2043 pivots, with resistance at the 2085 and 2131 pivots. Tomorrow: weekly jobless claims, the CPI and Philly FED at 8:30, then the NAHB at 10am.

The market opened higher today, following the rebound in Europe/Asia, rose to SPX 2084, dipped, and then hit 2086 right after the FOMC ended. The market had closed at SPX 2075 yesterday. After the press conference, however, the market gave back its gains to end the day slightly negative. Between yesterday’s low at SPX 2064, double bottom, and today’s SPX 2086 high, the market has had its best rally since the 4-day pullback began at SPX 2121. This market remains in the SPX 2026 – SPX 2121 range pending overnight action in Europe/Asia. Short term support is at the 2070 and 2043 pivots, with resistance at the 2085 and 2131 pivots. Short term momentum nearly hit overbought after yesterday’s positive divergence, then ended the day approaching oversold. Typical post-FOMC volatility. Best to your trading!

MEDIUM TERM: uptrend under pressure

LONG TERM: neutral


About tony caldaro

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385 Responses to Wednesday update

  1. mike7x says:

    Bears. Time to sink or swim…

  2. rd3777 says:

    Waterfall starts tomorrow…..

  3. Bob Sagget says:

    “The sad truth about today’s massive roller-coaster roundtrip is that it was driven by the death of a British MP which sparked speculation about delays to the Brexit vote…”

    • fishonhook says:

      Killing a young women with two children because you don’t agree with her views!?? they should fry that bastard.

  4. Option premium for next week way too high. Playing the one day move tomorrow. The high of day hit my target but it extended to close. An up day like today implies no washout event. I still expect a drop tomorrow but not as steep as originally thought. Now most likely the down trend continues to at least Monday.

  5. micky says:

    quite strong, almost 50% retrace in a few hours

  6. captbara says:

    50 DMA back test at 2077

  7. Looks like a very important potential smokin’ reversal. I might be early but I can smell it.

  8. phil1247 says:

    if da boyze sqeeeze it up overnite above 2084 esug

    target 2133 comes back into play

    • ewmarkets says:

      Phil, I know you use 15-minute charts and target -23.6% extension. My question to you is, how do you decide whether or not to take profits at that target? When a move has momentum, it often goes right through and keeps going and does not pullback. If you exited at -23.6%, then you’d be out and miss the rest of the move.

      • phil1247 says:

        dont have to sell all….scale in and out

        now i am only 25% short
        plus wait and see if it goes thru target or not

        if it goes thru wait to sell

    • I have a count where a was 2025 to 2120 B down to 2050 C up to 2145. 2033 seems reasonable to me

    • fionamargaret says:

      …would you go long here Phil…??

      • Jack Sparrow says:

        no because at minimum there is a correction coming after this 5 move up…

        • fionamargaret says:

          Thanks Jack and Phil…..I didn’t …seems forever since I went long overnight….
          You both are tremendously helpful…. I was just doing my numbers thing, and doing ok, but thought i’d check in with you guys….that line chart you did Jack was super, and the numbers Phil gave as stopping the advance… I was just feeling I was walking in mud…
          Thanks again xxx

      • phil1247 says:

        not until ext short fails at 2075

  9. rd3777 says:

    rally like it’s 1929….and oil is in a 3rd wave,,,,,,insanity rules….

  10. Sandra Dons says:

    This is the end of shorters

  11. phil1247 says:

    trader joe

    did you see my question to you about /SI ED ????

    guess i got my answer

  12. micky says:

    a up seems almost done

  13. This is what it looks like, so far.

    SPX - Five Minute - Jun-16 1509 PM (5 min)


    • captbara says:

      Waves up today look subdividing.

    • 123 abc says:

      TJ, appreciate the chart, thank you for your thoughts. How would you count the internal structure of the final wave-v up thus far?

      • It’s not done ’till it’s done. Meaning specifically, that since waves i and iii are nearly the same in length, that is very often a condition when wave v extends. I know what it “looks” like on the chart I showed, but it would likely be way too early in a wave sequence for an ending diagonal.

  14. johnnymagicmoney says:

    lower prices at same oversold conditions

  15. purplember says:

    how are ppl seeing the waves? i can see 5 waves up from 2025 but can also see 5 waves down from 2120.

  16. vivelaamo says:

    Could be a very bullish looking close. Is this really as good as it gets? Brexit my Arse!

    • Jack Sparrow says:

      for bears this is A of correction – for bulls 1 of 3 of PV (TJ count)

      • EL MATADOR says:

        pick one why confuse yourself with “if” …. price already telling you what one it is

        • Jack Sparrow says:

          cater to both crowds.. that does not affect the trading- trade both sides,.. if you can count in the shorter time frame.. for me its easier to count shorter time frame than long term views…as such i dont profess to have that knowledge..
          we are sitting here arguing for last many weeks bears or bulls, while waves are moving both directions..may be 300 point move in this region while the argument and chest thumping and abuses continue from both sides

  17. kvilia says:

    Got stopped out of my short positions – very frustrated.

    • Jack Sparrow says:

      you are on the wrong side of the trade today- take a shorted when it was completing its five moves down and on the way up

  18. phil1247 says:


    i think da boyze may have wamboozeled me on gold waiting for that target to hit

    they did the same thing on oil ….. front running target ..

    gold should be ok tho

    silver and gdx maybe not

  19. phil1247 says:


    if this is an ending diagonal with throwover as suspected this morning

    support is quite a bit lower

  20. Jack Sparrow says:

    two trends line -one resistance – the other support for today

  21. phil1247 says:


    we have broken the .618 level of long from lows of may 19 at 2050

    now we are coming back to test the broken 2062 .50 level of long from lows from below

    two shorts are in charge now
    the extension short and traditional short

    their targets are 2031 and 2027

    no rally can gain any traction
    until the 2065 .618 level of traditonal short is broken first
    and then the 2075 .618 level of ext short must break

  22. scottycj1 says:

    That’s how you do it folks. Sell puts and then when near the strike at expiration just buy millions of dollars of 15 or 20 Dow stocks and push the averages up. Now you keep your put money and you can sell the stocks you bought next week for a tidy profit as well. Anyone can play this game that has millions of dollars to throw around. Occasionally they are over sold by Hedge and Mutual funds that really want to leave the Party. When that happens you get action like Aug 2015 and Jan 2016. The put sellers get underwater and then caught in the liquidation…..they get stopped out/cut losses and add fuel to the selling. Then it really goes down fast.

  23. What should have been a bullish breakout on gold has been turned into possible key reversal day if gold doesn’t hold 1305.”They” sure know how to do it…AND turn equities around at the same time.Multitasking.

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