Thursday update

SHORT TERM: gap up opening as Europe rallies, DOW +230

Overnight the Asian markets gained 0.8%. Europe opened higher and gained 2.0%. US index futures were higher overnight. At 8:30 weekly jobless claims were reported lower: 259K v 277K. The market gapped up at the open to SPX 2101, ticked up to 2103, and then pulled back to 2098 by 10am. At 10am Leading indicators were reported lower: -0.2% v +0.6%, and New home sales were lower: 551K v 619K. The market then reversed and started to move even higher. By noon the SPX had reached 2108. Then after a pullback to SPX 2103 by 2pm, the market rallied to close at 2113.

For the day the SPX/DOW gained 1.3%, and the NDX/NAZ gained 1.5%. Bonds lost 17 ticks, Crude rose 90 cents, Gold slid $8, and the USD was lower. Medium term support remains at the 2085 and 2070 pivots, with resistance at the 2131 pivot. Tomorrow: durable goods orders at 8:30, then consumer sentiment at 10am.

The market gapped up at the open today for the second time this week. Unlike Monday’s gap up, this rally moved higher rather than being sold off soon after the open. With today’s rally, and SPX 2080 not getting breached during this week’s pullbacks, we now have five waves up from last week’s SPX 2050 low: 2080-2063-2101-2085-2113. Pullback next, regardless of the outcome of the UK vote? Possible, since most are positioned for a ‘remain’ outcome: FTSE up 5+% already this week. Short term support is at the 2085 and 2070 pivots, with resistance at SPX 2121 and the 2131 pivot. Short term momentum ended the day quite overbought. Best to your trading the results of the UK vote!

MEDIUM TERM: uptrend

LONG TERM: neutral


About tony caldaro

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722 Responses to Thursday update

  1. Expect a sharp spike move early next week that can actually take out recent highs. Crazy? perhaps. Bought at end of day SPY 211 and 212 Calls for 7/1 expiration.

    As for the so called “game changer” someone has to explain how the 2 year crash from China and contraction in EU, not to mention the crash in OIL didn’t yet change our game? Inquiring minds want to know? Lets use logic and common sense. Brits have zero affect on our domestic economy. We are a service economy at record lows in unemployment. But hey, what do I know.

    Like all the other predictions, as they come true, they will be forgotten and I will be on the coals trying to defend my latest view. So be it!

  2. cj32 says:

    SPX and GOLD cr. to CBZ..

  3. Dex T says:

    Since the first half hour ramp market has been steadily selling off throughout the day- we already broke the morning lows. But last night was far more exciting.

    Next week we should revisit the over future lows at ES 1999- no bottom in yet!

    with 20 minutes left this is going to end up one brutal day and week!!

  4. beginner101 says:

    is there a bullish or bearish bias next week?

  5. wanderer says:

    Nice orderly selloff. My orderflow indicators suggest that there is no floor yet. I am not sure if it was mentioned here: two days ago, the Fed monetary policy report said that the U.S. stocks are overvalued and vulnerable. So, for those of you who are looking for PPT to save you, take a note.

  6. jjjzzzwww says:

    Interesting ….FTSE down less than SPX, CAC and DAX

  7. purplember says:

    we’re so close to 700 posts

  8. beginner101 says:

    anyone seeing A=C on this drop to 2033?

  9. captbara says:

    Just got the LL on GDOW. Bulls “least pain” scenario

  10. rd3777 says:

    Looks like the c of abc wave 2 of 3 after this is done should see the start of much lower prices…IMHO No rec!

  11. phil1247 says:


    target …………….1971

    bearish below … 2053

  12. fishonhook says:

    Ok folks lets have your best counts

    P5 ended?
    Or this is 2 of P5
    Or 4 of P5
    Or Tony’s B of 1 of the bear market coming back to life.

    • jjjzzzwww says:

      P5 ……hysterical

    • Dex T says:

      Bear market. The move up from February still looks like a giant corrective wave that extended farther than it should have.

      Going forward I expect a lot of arguments on when the bull ended and if this was the end of P5- there are a lot of surprises left to come.

      P2 and P4 don’t work for foreign markets like Nikkei and DAX and some US like NDX – though I expect some bulls will be coming around with interesting “counts” for the S&P.

    • fionamargaret says:
      …and now London is wondering if they can still stay in the EU, as that is how they voted…maybe don’t sell your bank stocks yet….unbelievable.

      • Dex T says:

        LOL! Without the British taxpayers to fund their schemes London’s political and banking elite aren’t going to get very far- and rest of the EU isn’t going to want them anyway- they have enough paper pushers as it is!

  13. kvilia says:

    Already talks about rate cut in July 🙂 Prepare for the dump and then a rally before an epic sell-off after FOMC.

  14. mike7x says:

    Turn up the heat…

  15. Just on a side note.
    Six months before, few confirmations came in that people physically (location wise) have started coming on this blog. I knew that they know me but I did not know them (and still don’t know). 4 weeks before, first confirmation came in that someone who lives a floor above me comes on this blog. Second confirmation also came and yesterday third confirmation came in.

    Usually British people take pride in saying “we are watching you..”, so was surprised no one physically around me said that in last 6 months. So, I was working with idea that strategy of people have changed (about me) of not letting me know that they know I am on this blog.

    Years before, my friends asked me why I keep playing with dummy external images..and this is one of the reasons..

  16. Does anyone actually think the BREXIT is a game changer? Anyone think we are now in a secular bear market where yesterday we weren’t? As an article I just read mentioned the test case for anti-globalization and break from EU will be seen in a years time. Expect a lot worse for Britain and the people that will get affected the most will be the same ones voting for this departure. In fact once thy are shown just how badly they do without the EU all other nations will step in line. Britain was never a staunch advocate for joining EU because they view themselves in a puffed up manner and think their status in the world stage should always be front and center. Now they get their chance. Watch their pound get pounded and costs rise substantially. Analogous to those NYC riots during Civil War over conscription. Lunching blacks only released the anger and tension but it sure as hell didn’t help their cause. leaving EU will be so painful that in 2 years time there will be massive demonstrations against the newly elected party. Scotland will likely push to leave Britain and Ireland which has the only border with the EU would have to enact new border patrols. Could easily split both Ireland and Scotland away from England. My guess is that most mainlanders will not care. It will just increase their xenophobic history.

    They know not what they do.

    • Dex T says:

      Of course it’s a game changer Gary/Holly Silverwitz – and the market believes so too which is why we have huge downs across the board.

      Didn’t your “macro perspective” ever lead you to study the U.K’s / E.U.’s economy and it’s global connections to U.S. corporations, banks, various funds, real estate, etc…??? Do you realize just how many entities have invested in/have ties with the EU and U.K.??

      This move affects trillions in wealth and is far more serious than the Fed’s paltry 0.25 rate hike.

      How much worse can the U.K. do?? They were already being taxed to the bone and seeing their money going to support a neverending horde of welfare scroungers.

    • What’s really ironic is that this is how the old folk in England think they can fix their immigration problem…. by leaving the EU. Never mind that over half of the immigrants are coming from countries that are OUTSIDE of the EU!

      Meanwhile, these old folks have just watched their vote clobber the pound to 30 year lows. That’s got to be real good for their household buying power.

      • fionamargaret says:

        Nothing is really simple.
        Scotland has gotten into the act saying their referendum was dependant on them remaining in the EU. Wales is quiet, as is Ireland so far.
        EU mining companies (listed in London) are considering switching to Toronto.
        But, as i mentioned in my previous post, London wants to be an island unto itself, and is trying to stay in the EU (as that is the way they voted).
        I think the Leave will be reconsidered, and maybe adjusted.
        String theory was the big discussion last night, and most seemed to think a better deal was brewing…….

    • Gary, you don’t have an iota of idea about how economy works. Nothing will change for British people, in fact, it was good decision to get away from Europe. Canada has already approached UK for trade agreement. There are already million uneducated school drop out British born. Million more uneducated school drop out moved from EU. Those coming from EU are uneducated school drop outs, not Ph.D. UK can have good immigration system for qualified people. UK has only pharmaceutical/defence/aerospace as major exports. Currency has crashed, which will substantially help exports. Good news..good new.. UK on path towards permanent prosperity…

      • kvilia says:

        Thanks god, someone with brains :), . The ugly thing is that Holly’s style is very similar to what Hillary keeps telling the herd, with the same level of conviction, at the same time wearing 10K blouse while delivering inequality speech.
        I am actually proud for Brits. In the long run they are OK, jumping the sinking boat.

      • dwr51 says:

        What are you smoking ? And why aren’t you sharing it ???

      • makiori says:

        I feel sorry for you and your “little Britain” conception and understanding of serious matters. But don’t worry you are quite sane… and everyone else is part of a conspiracy plot to spy on you. Get Lost! “those coming from EU are uneducated school drop out…” . I’ll take you for a tour of hospitals, laboratories, trading floors, law firms, architects, and on and on and on,… to met some hundreds of thousand “uneducated” Europeans.
        If the “uneducated” Europeans living in the UK, were not to show up a work just for one day, the country will collapse.
        I have been on this blog since 2008, and never had a rant, never, but you really managed to piss me off.
        Apologies for this Tony, i must be on a 8 years rant cycle and I promise I will not rant again until 2022 🙂

    • mcgcapital says:

      Yet another long winded and factually incorrect post

  17. Hi,
    S&P left a big IH in 4 hours chart to be observed

  18. The most eye opening thing about all this was the myth that bookies are infallible
    went out the window.If you can’t trust your book…who CAN you trust?lol..
    Anyways,still looking for a gold pullback July 1st.Should revisit 1365 again,I think.Good luck all.

    • Our if you beleive in conspiracy. How about the bremain camp funded losses to influence the outcome. I.e. If you thought it was a 6-1 odds to remain, why bother voting against. Who knows. Begas had golden state favored by 5.5 for game 7. They lost. Happens. Usually they offsets there bets so the make 10-20 on the overall take

    • ajaysinghi says:

      You have to.understand that the numbers were skewed. The average bet of remain was almost 5 times that of exit, but the majority of the folks betting were on exit.

      Even with a 10-15% probability assigned by the bookies, ‘Exit’ actually had a pretty good chance of winning.

      This is one of those rare cases where the small guys beat the money power of big guys.

    • Dex T says:

      Somebody posted an article from zero hedge earlier that discussed this. Basically a few large bettors were skewing the results.

      The politicians and wealthy bankers worked hard and used every dirty trick in the book to keep the “Remain” vote number 1

  19. mtu MTU says:

    [1255pm EST Jun 24] SPX Update –
    SPX is testing its June low and probing for potential short term support. Note the short term wedging, channel, and +ve divergence. See charts.

  20. Scott C says:

    Awhile back before the change of stance to neutral, we were expecting the break of the 2019 pivot to waterfall (Tony wrote that in a message as a possibility). If we get to that – would that thought remain or has so much time gone by where it would not prove. Kind of a learning questionas as to how to anticipate the markets but could profit from it of course..

  21. I don’t know what is more funny…. people thinking that EW caught this big down move today…. or the Brits jumping up and down and partying the night away …. because their currency just got pounded down to 30 year lows!

    I think Great Britain just became Little England.

  22. jjjzzzwww says:

    just busted 6/16 low

  23. rd3777 says:

    Been a good day so far….a nice 5 figure profit @ about 100pct profit….hoping to hit 6 figures soon. The angst and toil make this highly rewarding….

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