Tuesday update

SHORT TERM: gap up turnaround Tuesday, DOW +269

Overnight the Asian markets gained 0.1%. Europe opened higher and gained 2.4%. US index futures were higher overnight as well. At 8:30 Q1 GDP was reported higher: +1.1% v +0.8%, and at 9am Case-Shiller was reported unchanged at +5.4%. The market gapped up at the open to SPX 2019 and continued higher. The market had closed at SPX 2001 yesterday. At 10am the SPX hit 2027 and Consumer confidence was reported higher: 98.0 v 92.6. After that it pulled back to SPX 2016 by 11:30. Another rally followed which carried the SPX to 2036, where it closed. Volatile market!

For the day the SPX/DOW gained 1.7%, and the NDX/NAZ gained 2.1%. Bonds gained 2 ticks, Crude rallied $1.60, Gold slid $13, and the USD was lower. Medium term support rises back to the 2019 and 1973 pivots, with resistance at the 2043 and 2070 pivots. Tomorrow: Personal income/spending and PCE process at 8:30, then Pending home sales at 10am.

Yesterday we had noted three waves down from the recent SPX 2113 high: 2055-2073-1992. We also noted the third wave had subdivided into five waves, which ended with a positive divergence: 2033-2049-1992-2006-1992. And the market had already reversed off that low to SPX 2004. Today the market gapped up and did three waves up: 2027-2016-2036. Should the market continue higher to the 2043 pivot tomorrow, we have probably seen the completion of three Minor waves down from the uptrend high at SPX 2121: 2050-2113-1992. This would suggest the rally could continue to the 2070 pivot before heading lower again. If the market fails to reach that pivot, it will probably make new downtrend lows first before rallying to the 2070 pivot. Short term support is at the 2019 and 1973 pivots, with resistance at the 2043 and 2070 pivots. Short term momentum rose from a positive divergence to overbought. Best to your trading!

MEDIUM TERM: downtrend

LONG TERM: neutral

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

About tony caldaro

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489 Responses to Tuesday update

  1. locanbbs says:

    UPDATE: According to the %BB indicator FTSE, KLSE, MXSE stock markets are now in the “green” area and are now “buys”. Energy and mining stocks have on the whole already been buys for several days. All other indicies that I follow are gradually improving. TSX will soon probably enter the “buy” area.

    • locanbbs says:

      Interesting that the English stock market (FTSE) is the strongest of all those markets.

  2. beginner101 says:

    anyone shorting into today’s rally or waiting for the 5th wave higher with divergence? thanks guys

  3. Lee X says:

    Happy (early) Independence Day and 2070 pivot time Tony !


  4. Here’s the “official”explanation of the last four trading days:
    “Brexit passes” was fed into the algos(as a sell)and the bots took over.Then the EU monsoon came in to save the day.Sprinkle some Fed dust and another crisis averted.What algo would cause another selloff is the question?

  5. Saw a quote recently that I like. Worth repeating here, “when the market is ‘wrong’, it doesn’t pay to be ‘right’.”

  6. Did I mention that my prediction of yesterday also applied to today??lol.What a “market”.

  7. rd3777 says:

    What happens when the cable starts to collapse over night?

  8. mjtplayer says:

    Given the volatility and volumes lately, today’s rally is on very light volume. SPY volume is much lighter than yesterday, less than 1/2 of Monday’s volume and roughly 1/3 of Friday’s volume.

    So far, just a bounce. 50% retrace exceeded, approaching the .618 retrace. Tomorrow is the last day that the bulls have end of quarter tail-winds. After that it’s in the bears’ favor.

  9. allen1929 says:

    es high fri 24 was 2064.75 followed by brexit bust
    todays es h 2064.50 so far. The gap above is @ 2105.75 es
    will it fill?

  10. Gary Lewis says:

    Can anyone really be surprised about yet another V-shaped recovery? Especially in light of the fact that immediately the ECB came in with 250 billion Euros to backstop any bank losses. Stocks up, bonds up, PMs up; more QE will continue to work until the central banks collapse, and then only the holders of PMs win, – well of course, there’s always confiscation for the good of national security.

  11. Sudden destruction unfolds suddenly!

    1987 Crash happen suddenly as the market was rising!

    Everything that originated from knowledge of man carries in it duality.

  12. Jack Sparrow says:

    we just finished 3 of this move up

  13. blackjak100 says:

    Someone told me to watch the expanded flat in the futes. The problem is its target is 2088 so another 23-24 handles above this. It doesn’t have to hit it, but it still hasn’t exceeded it’s wave A high. Less than one tick left to exceed it or it truncated if we head south immeadiately. Somehow I think 2073 is relevant as there is 3 waves up to the 1.618 ext. there. The key is do we get a 4th wave (11-15 pts) in cash market?

  14. captbara says:

    2073 1.62 wave 3 extension, but it looks like it wants the 2.62. I dont think I would hang around for that if I was trading ST though.

    • blackjak100 says:

      why do you think it wants 2.62 with 60min RSI(5) @ 90? Not enough juice my friend w/o 10+ pt pullback which would then be a wave 4 IMO.

      • captbara says:

        Pure gut feeling, haven’t looked at the charts much today. Just saw that if it does run up to 2100 or so that would make for a nice IHS setup if a RS comes afterwards.

  15. johnnymagicmoney says:

    So Brexit apparently was a positive event lol

    such a dumb market

    • ewmarkets says:

      It CAN be a positive event; it is a matter of perspective. As Junker said in his after-referendum statement, what does not kill you makes you strong. EU is reflecting on its policies and seems determined to change. That is a huge positive. Sure, Britons have to suffer to ring the wake-up call to EU but it may very well turn out to be a positive turning point for the EU. Market, however, is a different story. Long term averages will follow fundamentals but short term, it is an unruly crazy man.

      • johnnymagicmoney says:

        it isn’t positive. Put lipstick on the pig if you wish but it still is a PIG. It just isn’t positive. Market can drink kool aid all it wants (keep in mind I’m not arguing to go short here because fundamentals are not priced in). I’m just saying its ridiculous

  16. torehund says:

    Pesos is cheap nowadays, maybe Trump needs to build that wall 🙂

  17. Looks like the wave 3 has started and 1990 was the low. Will we have any pullback ? Difficult to see it since this PV could go overbought forever.

  18. micky says:

    70 holds then high 70,s and 80,s next, looking like subdividing

  19. Was ridiculed on Friday to suggest a big spike up to minimum 2070. Made 6X on that one bet.
    I will most probably bet one more time depending on close today. possible third day move that should equal or exceed 35 SPX points higher. But hey I am the non-technical person that doesn’t even know that we are in a bear market. I believe someone wanted to bet me?

    Love those signature patterns. Carry on with your stubborn diatribe trying to convince people this is a mistake. Love the person that bets without a parachute. If you can’t learn to play the moves both ways you shouldn’t play at all.

    Sermonette 12.

    • johnnymagicmoney says:

      so Golly how did you make 6X on that bet when you were long the whole time when it dropped?

      • Nope not true. I was long end of Friday and got walloped for it. Thought Monday was the big reversal. Only meant I would have made a lot more. I even added to my position late Monday convinced a 2 day drop was all she wrote. in fact you can look at my statements on Monday. People thought I was crazy. If you want proof I will go head to head with you here if allowed. Ask TONY since I started posting my actual best and was told he didn’t like that.

        I love competition. I do best when challenged. I stay more focused and only place the bets when I think the adds are excellent. In fact I stated that the minimum move should be 2070 on this spike up. I saw 2070 to 2100 and most likely 3 day spike move is more common. I might bet again for one more day move that should push off another 35 SPX points intra-day. That is ONLY if we don’t have a run-a-way move at close. Need to see the normal 35 average which places it around 2070 at close.

        I will be sure to let you know when I bet again. Investorshub under name GDL knows me. I even post my bets 80 percent of the time there. They will tell you if I am a streak player or not. they will also tell you some of my big reversal guesses. I love this game. Especially when right. I actually missed the drop and should have played the straddle against the vote. Oh well. Can’t win them all.

        • mcgcapital says:

          Yes but how were you positioned at the close on Thursday? Long, short or neutral? And if long, where did your stop loss execute. Sorry to be pedantic, but it’s relevant because from what you post it sounds like you’re always long (and hence would get caught out on the drops).

          • I don’t play very frequently. ONLY when I see a good chance at a reversal move either up or down. Very disciplined rules I have. I saw the big swings only after the vote took place. Volatility usually lasts not much beyond a week to 10 day after event. I post almost all my bets. Some are from away from home so I don’t bother. This board is more for information when I am leaning and need a push from some technical gurus. I always appreciate help. not ashamed to admit. I usually dismiss the strong biased person no matter how good their technical prowess is. Long term bias always puts too much influence of what someone sees.

            BTW I did place another bet for tomorrow and since the move was so telegraphed (for me) I had to assume one more day up. Long shot out of small amount of the winnings. Pushing my luck but what the hey, it’s only money. I give it 60/40 odds of moving 30 to 35 SPX points tomorrow.

    • mcgcapital says:

      Congrats on the trade, credit where it is due. You should have taken me up on the bet! However, if you want people to take you seriously you need to let us know when you aren’t bullish as everyday you post about being long, so you’re either being stopped out frequently, averaging down or not trading at all.

      • Not at all. My best historical biggest 3 wins were shorts. I was kicking myself over the stupid mindset I had prior to the VOTE. Why I thought it was a bad bet I’ll never understand. I was sure they would remain but was going to bet a straddle. These types of lapses are inexcusable for me given the long established regiment I follow. I use websites (blogs) to talk out my position and reasons behind it. I just stayed away from the blog and took a vacation away from betting. Now that was really stupid on my part. Made up on the spike up.

        A close around 2070 and I will take a small portion of winnings and bet for SPX 209 for this Friday, depending on premium. haven’t looked it up yet.

        I still see a big drop but short and shallower than previously thought. 1950 should be the max pain. If tomorrow is higher Friday thru next Tuesday should see the drop. Only as of todays action. if things change I will let you know if I change my position or not. Nothing is static.

    • hakunamatata1966 says:

      Great call Gary, even though did not make anything out of your call but you sure were on the money. However great call …

    • vivelaamo says:

      Gary ignore the bearish haters. You called it spot on. You’re my new hero.

  20. phil1247 says:

    target hit


    hasta !

    • fionamargaret says:

      ..well done Phil…and thanks x

      • phil1247 says:

        thanks …

        were you able to get out of your short on the dip??

        • fionamargaret says:

          yes thanks, and also sold TLT at the beginning of the day.. TLT usually corrects 2 boxes, and I buy then….buy and sell every three/four days…I know by the numbers….

  21. jjjzzzwww says:

    (2071.08 – 1991.68) / (2120.55 – 1991.68) = .616

  22. dan pulford says:

    May be a FNL UVXY 10 min. Hope it is. VIXter

  23. vivelaamo says:

    Massive weekly inverted H&S in major indices!

  24. lets see if we cant close at 2082

  25. phil1247 says:

    es 2064 next target

  26. Tony Jordan says:

    Let’s see if you can complete the following sentence:
    Gap down openings are often characteristic of a downward wave 3 whilst gap up openings are often characteristic of an upward wave …?
    Brexit brought with it initial violence to the markets. This has subsequently calmed down appreciably. The uptrend from the lows has been without violence, steady and with only shallow retracements. Seasoned traders should be aware these are not characteristics of a corrective wave. It would appear the panic sellers have exhausted themselves in a classical wave 2 type move, fast and furious. What remains now is regular steady buying and short covering. I’m guessing the slight pullback to the mid 2060s was 4 of 3. If correct there is a chance the larger 4 will also correct to this general area which will be a buying opportunity for wave 5. Also, a couple of days ago I mentioned the Daffy DAX, then trading at 9330, should reach the 9720 area again on this move at a minimum. The reason for that expectation has not changed but the DAX has only reached 9640 so far and is currently trading at 9613. Bottom line, stocks should generally be viewed at safe havens as the mega sovereign bond bubble approaches its zenith. Best of luck.

  27. Page says:

    SPX extremely overbought, pullback starts tomorrow.

  28. vivelaamo says:

    Respect to Golly. Called it spot on even if many didn’t agree with his rational! Credit where credit due!

    • johnnymagicmoney says:

      maybe we should call him/her Pat (like Saturday Night Live)

    • wanderer says:

      Fallen heroes: aahmichael, rd3777, and many others who called for lower lows after the Brexit selloff..
      Rising stars: Gary and Tony.

      Such a reversal of fortunes!
      As always, I am neither bearish not bullish.

      • fionamargaret says:

        ..absolutely, now why don’t you just ignore Gary’s posts..and let’s get back to happy…
        there is so much talent here, we can surely make money and care for each other..

      • vivelaamo says:

        Brexit? What Brexit?

      • EL MATADOR says:

        do you have room for neutral stars like myself 😉 lol

      • Wanderer, Aah may have gone wrong in calling lower low, but he usually comes back in ring in few hours. The rally will stretch sideways, Bullish till third week of July. Then further sideways to lower side till Aug 3rd week, then total collapse.

      • aahmichael says:

        I’m not a daytrader or a scalper. The market commentary I offer here and the trades that I post are on a much longer time frame than the rest of the people who post here. My positions can last weeks, months, and even years in duration. The hourly and daily gyrations that cause everyone on this blog to either freak out or have an orgasm are nothing but noise to me.

  29. cmucha68 says:

    Like I I said on Monday: this could develop in a full V shape recovery. Look 4 h chart on spx. With in fact zero interest rates all
    over the world money will always come back to stocks. There has never been a bear market, there is no bear market and will not be for quite some time. But hard pullbacks are always good for making a larger profit with puts from time to time. But bull is still intact. Bear will start when when Tony starts taking about spx 2500.

    • johnnymagicmoney says:

      Japan’s zero rates have surely fostered a huge bull market hasn’t it

    • EL MATADOR says:

      Why did the ZIRP 1932-1397 bull market fail?

      • fionamargaret says:

        ..did Richard 11 have a bull market Mat ..

        • fionamargaret says:


        • EL MATADOR says:

          who is Richard 11?

          • fionamargaret says:

            King of England during 1397 (I know you did not mean that year, but interesting just the same).
            The peasants were revolting, but he was quite excellent at handling the situation, and introduced the royal prerogative.
            He was tall, good looking and did well, except towards the end of his life, he had a personality disorder which in the history books is referred to as insanity.
            I probably would have fallen for him too…

    • Dex T says:

      The bull market is not going to last forever. That’s purely wishful thinking. QE has simply distorted economies and indices worldwide and the metrics used to measure them.

      It’s been well over a year since the high. Every time it gets close it turns back down again-there is no reason for a massive run to begin. The same reasons have been recycled over and over again but all the risk remains to the downside.

      Investing in stocks the past year has not been a good investment option. Cash and it’s alternatives are perfectly viable. People have been chasing risk for diminishing returns.

  30. Jack Sparrow says:

    if oil breaks 50.50–new highs comings close to 60

  31. Place 2 Sardines on your dinner plate tonight, then try to determine which is male or female.

    Liken to determining bull market vs bear market.

    The differences are so tiny! It’s often fruitless endeavor. Best at latter stages of bull or bear market to Trade what’s in front of you!
    We know, Elliott Wave OEW is predicting.

  32. johnnymagicmoney says:

    From now on I am suggesting everyone refer to Holly/Gary as


    kinda fits because when it dawns on Golly that she has been wrong all along
    about the economy you can here her say “Awww shucks gosh darnit, by Golly it’s true”

  33. EL MATADOR says:

    Good stuff by Tom McClellan,

    “I am starting a personal crusade to expunge the notion of “10% is a correction and 20% is a bear market” from our collective lexicon. It is among the most meaningless, useless, and untrue statements out there.

    The reason I dislike it so much is that it offers no insights about what a trader or investor should do. If you find the market down some percentage, and conclude that, okay, it is a “correction”, then so what? What does one do next?

    Every 20% decline goes first through 10%. So if one says, “Oh well, it’s 10%, so it is just a correction,” then that would be similar to the guy who jumped off a 20-story building and was heard to say as he passed the 10th floor, “So far, so good.”

    The chart above shows the stock market decline from the 2007 top to the 2009 bottom. I am going to assume that we can all agree that this was an example of a “bear market”. Having lived through it, I also know that early on during that decline, there were a lot of people who were saying that it was “just a correction”. This decline ended up traveling far beyond the 20% decline threshold. And it did not become a bear market upon crossing that line; it was a bear market the whole time, whether anyone knew it yet or not.

    This helps us understand the point that defining the 10% and 20% thresholds as markers for categorizing types of declines is a functionally meaningless exercise.”


    • Welllllll,the only thing is…it’s a bear market AFTER the fact but not until support levels are taken out.For instance,if this current market drops back down to 1820–doesn’t break it again and goes to 2300–it’s not a bear market.But,if 1820 gets taken out and proceds to 1200…it IS a bear of some type.Length of time and point loss are indicators of the strength of a bear.But it’s semantics at that point.

    • gtoptions says:

      Is this write up for the benefit of CNBC viewers. How many Bull/Bear Markets have they been in the last two years? LOL 😉

  34. take a look at the $skew … all time highs… bad things happen when its flying this high….


  35. dan pulford says:

    Sold TNA Bought uvxy at 1:30pm Orlando time. EDT The VIXter

  36. Very little in the way of any down movement yet. Wave black iv? can get quite long in time if it wants too.

    ES 09-16 (60 Min)  6_29_2016b


  37. For those that would rather use the SPX A/D line (!ADLINESPX) instead of the interest sensitive laden NYSE….. the SPX A/D line did not break to new lows for the month like the SPX did during Brexit. Yet another positive divergence buy signal for those that value classical T/A.

  38. micky says:

    cash did not quite hit the 70,s on my chart but sounds like it may have been it for now

  39. cyanus66 says:

    Looks like the Brexit drop gave mkt a chance to get its 4th-of-July rally, without having to make a higher high. Having its cake & eating it too!
    We get to worry about the indigestion a bit later then, it seems.
    Last year June 23rd & July 20th were the SPX notable highs in the run-up into the Aug drop.
    We really are acting convulsively similar, aren’t we? 🙂

  40. EL MATADOR says:

    check out the wave symmetry btw Nov-Dec 2015 drop-pop distribution zone and the current drop-pop distribution zone ……. bull can cheer all they want but the Brexit low will be taken out … just my 2c

    • fionamargaret says:

      ..and everybody thinks so, except things have to look ok end of month…liquidity problems European banks, uk not much better…talking more QE….need you to trade commodities for me….x

      • fionamargaret says:

        ..you could consider TLT…

      • EL MATADOR says:

        Fiona, which commodity (other than oil) are you interested to hear about?

        • fionamargaret says:

          I can do oil….it is the rest…you are the greatest trader in grains, softs, metals etc., and that is where the money is going to be made….we just need a good correction first, then up..if UK renegotiates, we are off to the races…..x

    • gtoptions says:

      The Simple Box Range! 😉
      Gap fill at 2113 ?

      • EL MATADOR says:

        there is a tight layered gap near 2113….i will be shock to see it get filled …I expect them to remain open gaps … Bulls have to prove me wrong or catch me 😉

      • fionamargaret says:

        GTO..you are sounding like me…but would like down first – 1965 – then up to 2300…

        • gtoptions says:

          Like the market, I am indecisive on what I want to be a Bull or a Bear. 😉
          These snap back rallies all seem similar, overshooting and frustrating for some.

  41. Vemala Siva says:

    boom means upppp

  42. ajaysinghi says:

    Spx tgt 1928 by Monday. Exit longs

  43. rd3777 says:

    The Dow @ .618 retrace in a Broadening top formation target area usually .62 to .66 pct added to my short on AZO @ 804 and it filled a gap and ten turned down…..

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