weekend update


The market started the week at SPX 2162. The market had a small bounce on Monday, then pulled back to SPX 2159 on Tuesday. Wednesday the market opened higher and rallied to SPX 2176, a new all time high. Thursday the market pulled back to SPX 2160, then rallied on Friday to end the week at 2175. For the week the SPX/DOW gained 0.45%, and the NDX/NAZ gained 1.55%. Economic reports for the week were positive. On the downtick: the NAHB and the Philly FED. On the uptick: building permits, housing starts, existing home sales, the FHFA, leading indicators and weekly jobless claims improved. Next week’s reports will be highlighted by the FOMC meeting and Q2 GDP.

LONG TERM: uptrend

Since we are dealing with possibilities/probabilities at this juncture in the equity market. We would like to add one more count, other than the Primary 5 and Major B counts already presented. This count suggests that Cycle wave [1] not only did not end at SPX 2135 in May 2015, but will not end for many more years to come. A little background.

26. DOWyearly

After the Grand Super cycle low in the year 1932, the market entered Super cycle 1 of a new GSC. SC 1 consisted of five Cycle waves (in years): 1937-1942-1973-1974-2007. Notice Cycle 1 was only 5 years, and Cycles 3 and 5 were over 30 years each. After the SC 2 low in March 2009 the market started Cycle wave 1 of SC 3. We naturally expected it to be short, in years, as noted in the last weekend update. After completing five waves up into 2015 the market entered a bear market. But the bear market only corrected 15%, and now the SPX is making new highs again. In the past 115 years this has only occurred four times. And each of these times the market was in an extended Cycle wave, not a short one. Which suggests this Cycle wave [1] is extending.


We also noted last week, the recent 2015/2016 activity has not occurred since 1953. After the 1949-1953 bull market during Cycle 3, the bear market that followed was less damaging, in percentage terms, than a correction within that bull market. Historically this has only occurred that once. Then after the bear market was confirmed in 1953, the market turned on a dime and rallied to new highs within five months. The same exact thing just occurred in this market. This also suggests Cycle wave 1 is extending.


As a result we have added a third count and placed in on the DOW charts. This count suggests only Primary I ended in 2015, Primary II just completed in 2016, and Primary III, (all part of Cycle wave 1) is currently underway. In order for this count to gain in probability the SPX must again exceed 2335, the 1.618 times relationship to Primary A (2135-1810). Overall whether one is counting this advance as an ongoing next leg up Primary 5 or a new bull market Primary 3, really does not matter at this point. Both counts suggest five large waves up before a significant top is formed in the years ahead.

MEDIUM TERM: uptrend

After the February low at SPX 1810 the market rallied in five waves to SPX 2111. Depending upon the long term count this could be labeled with an A or a 1. After that the market had a short downtrend to SPX 2026, a short uptrend to SPX 2121, then the Brexit downtrend to SPX 1992. Again depending upon the count this total action could be labeled either an irregular B or an irregular 2.


For the past four weeks the market has been uptrending. The SPX/DOW have already made new all time highs, while the NDX/NAZ/NYSE have yet to do so. Both the NYSE Primary V count, and the SPX Primary B count, suggest the NYSE will have to make new highs as well. The NYSE currently needs to rally about 4% to accomplish that. A 4% rally in the SPX is about 2250+, where we have targeted this uptrend to end. Then it gets interesting. We will get into those details as it unfolds. Medium term support is at the 2131 and 2085 pivots, with resistance at the 2177 and 2212 pivots.


From the downtrend low at SPX 1992, about four weeks ago, the market has been advancing impulsively. The first several waves higher are quite clear. Intermediate waves i and ii at SPX 2109 and 2074 respectively, and small Minor waves 1 and 2 at SPX 2109 and 2089. Then it becomes a bit unclear in the SPX 2169-2177 area.


The SPX suggests Minor waves 3, 4 and 5, ending Intermediate iii at 2176, with Int. iv underway. The DOW suggests only Minor 3 ended at 2176, with only Minor 4 underway. Since Minor 2 was a 20 point decline, and Int. ii a 35 point decline, the recent 16 point decline (2176-2160) currently suggests it is only Minor 4. Especially if the market makes new highs without dropping below SPX 2160. If it does drop lower, into the lower SPX 2150’s, then the Int. wave iv count makes sense. Short term support is at the 2131 and 2085 pivots,, with resistance a the 2177 and 2212 pivots. Short term momentum rebounded from quite oversold on Thursday to end the week overbought.


Asian markets were mostly higher on the week for a net gain of 0.4%.

European markets were all higher and gained 0.8%.

The Commodity equity group were mixed but gained 0.4%.

The DJ World index gained 0.4%.


Bonds appear to be downtrending and lost 0.1%.

Crude is in a downtrend and lost 4.5%.

Gold is still in an uptrend but lost 1.1%.

The USD remains in an uptrend and gained 0.9%.


Tuesday: consumer confidence, Case-Shiller, and new home sales. Wednesday: durable goods, pending home sales, and the FOMC meeting ends. Thursday: weekly jobless claims. Friday: Q2 GDP (est. +2.4%), Chicago PMI and consumer sentiment. Best to your weekend and week!

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

About tony caldaro

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171 Responses to weekend update

  1. fotis2 says:

    Least I forget Kudos on the Nikkei Tony!

  2. Thanks Tony. Good to see this open again.

  3. lcd00 says:

    Thanks Tony for restoring and socially refurbishing your site.

    The SOX index, IMO, should be monitored carefully here for signs of what is to come. It is nearing a double top 1 year in the making, just 1/2 % away, matching price from 15 1/2 years ago. It shows double negative divergence on Daily MACD, suggesting a meaningful retracement imminent, BUT the Monthly MACD just crossed over positively for first time in 3 1/2 years and looks like it wants to run even though the index has surged 36% since February; so the question is, how will it behave at 751?

  4. A strong classic breakout is indeed sobering. Not many trusted we would ever break new highs and told me so in no uncertain terms. good thing we now have a teacher to spank anyone out of line. I wonder if Hillary’s Presidential win or defeat is already factored in. The bookies are placing a 75 percent chance she wins. Hope they aren’t the same ones used for the BREXIT.

    In any event the channel is once again well established. In next 4 months any drop to lowest line should be bought. Currently don’t see anything lower than 2120.

  5. Scott C says:

    So happy this is back online.

    I. Anyone see crude in the 41 region for a bounce or are we getting close?

    For my sanity and following along — is this a correct summary and are the questions below make sense to the counts you have and bifurcation?

    II. Wave counting now — we should be topping in the B wave around 2250-2280.

    III. Here are the three counts.
    1). B wave count still alive until over 2335 — overall bearish opportunity still.
    2). NYA Primary V alive until over 2335 — overall bearish opportunity still.
    3). Dow Wave 2 if we head over spx 2335 – super buillish. (alternative)

    Q1. So, we are either going to have a global melt-up (3) or we are going to have a correction. and with the correction, we may not know what it is since that will be bifurcated… Is that true, or at least until some new point once we get some waves to the downside in place I am assuming??

    Q2. If it ends up being NYA primary V up completing — does that mean that the SPX count gets reconfigured accordingly with this whole correction down into 1810 being part of the top for spx you have currently in in May 2015?

    Q3. Do you see your 1100SPX possible still if the B wave count plays out or more so if Q2 above is a yes or regardless we achieve that area? I am not placing positions on that but am curious as you noted this could be a different 2 than seen before and wondering if it is due to the large B wave.

    .So many questions – so hard to articulate 🙂 hopefully they have some value in answering/commenting from some.

    • fionamargaret says:

      Scott, I would look at oil at 40/41….UWTI 19/20…..put in stops…undefined pattern….

    • tony caldaro says:

      1. a breakdown in SPX/NYSE would suggest Primary C underway for SPX
      2. count would remain the same, or shift to DOW count
      3. so far there are very few signs of this being a Cycle [2], may change though

      • Scott C says:

        Thank you for your replies Tony,Fiona, and Bud!

        If I may further ask Tony off of your #3 reply above,,, If you do not think this is Cycle[2] then why do we have the two options on the table at 50/50 which I thought are for a Cycle[2] (I know you mentioned an atypical cycle 2 but i don’t believe you discussed further), with the Dow count marked as an alternative? What count could it become then? I am not questioning you or OEW anyway just trying to see if i am counting correctly, etc.

        Thanks everyone.

  6. bud67 says:

    Ref OIL, Crude Oil. Believe price will test,
    the 2/11 lows…

  7. locanbbs says:

    Hi Tony! Hi Gang, hope I’m welcomed back!
    I’ve used the pause to work on even better indicators and charts, so I hope I can be of more use in the future.
    Typical: Start of new program today and got caught out in “the cold” (long). After constant new signals up and down, finally down won for a change. But probably only till tomorrow (= two week’s cycle bottom; after that a whole week “free”–till new moon!).
    Ups and downs today, probably down till tomorrow.
    SPX (futures, hourly):

  8. H D says:

    GM Tony, all. Lot’s of count options. I’ve had a hard time with this wave above 2121, reduced to scalping. Your 2177 pivot- very impressive. Tested twice now and found sellers both times. Nobody else had that level for R. Kudos! SPX seems some similarity w 2014, early Feb low and potential late July hit, Oct low and close year at the highs. Supports the NYA count IMO. SPX, if so, following the fib sequence that we keep seeing just (89) points shy of F17, 1597 points from the ’09 low. SPX 2264? Also month (89) of bull. My $0.02 worth.

    • Scott C says:

      Hi HD — The NYA has a lot further to go where as the B wave could possibly end anywhere couldn’t it?

      “Oct low and close year at the highs. Supports the NYA count IMO. SPX, if so, following the fib sequence that we keep seeing just (89) points shy of F17, 1597 points from the ’09 low. SPX 2264? Also month (89) of bull. My $0.02 worth.”

      does that mean you are looking for a fast move to 2264 to end NYA over the next week?

      What is your SPX Oct Low and where is that overall in your counts?
      Thanks for your time – Scott

      • H D says:

        The NYA count is currently showing a 1-2-in 3 but that can easily become a terminal pattern in PV. Following the 2014 fractal, Late July hit is int iv, Oct hit would be major wave 4.

  9. Nikkei fighting the same resistance it has been the last quarter, bounced yesterday again. Down from here?

  10. johnnymagicmoney says:

    Thanks Tony for being open to the comment section again….much appreciated

  11. Tony…glad to see the comment section back….absence makes the heart grow fonder. Looking at the spx weekly back to 2000….I’ve have great success with channels on lower time frames and the weekly time frame to me is saying that we are not going higher immediately. We tested the upper blue channel tl for approx 6 mos in in 2015 and the failure to break above took us down to in a 3 wave move to the 1810 area….now we are testing the blue upper tl again which is approx 2175 area….if we do manage to break it then the yellow tl should contain the first attempt to break it at the 2210 area from what i am seeing….thanks for all your help and for opening the comment section again. GL http://tos.mx/MoiTel?image

  12. Morning all…focusing on $XJY.Previous gaps were filled on the daily starting about 3 weeks after forming.Multiple gaps from July 11th til now.Patience needed but around Aug 2nd ,should see progress to 100 again with gold tagging along.Not sure if that will be a double top.But we should see some rally shortly–maybe after Yellen.Good luck all.

  13. reddragonleo says:

    ES Morning Update July 25th 2016

  14. fotis2 says:

    The tale of 2 descending triangles..



    • fionamargaret says:

      You are reading my mind ….wondered what you had for oil….thanks Fotis.
      I hope Phil will come back and work from here …..I like you guys around….x

      • fotis2 says:

        Hi Fiona missed the entry for the short on CL and tried a long to my detriment was seeing dbottoms on hourly ast week etc….the weekly pattern and CCI looks like targeting 40ish

        • fionamargaret says:

          ..Yes, I watched DWTI wrap up last week (on and off), and hoped Mat was in the game.
          I did not do well last week…like you, I was pre-empting longs…UWTI around 19/20 is a good point if oil actually turns around at 40/41…that is what I see….I hope Sparrow comes back…he had some good ideas….

  15. NEWBIE says:

    I see the market topping soon and to be followed by a 38 to 50% retrace down to 1500 area.

    • vivelaamo says:

      Thanks Newbie. Is that based on technicals or fundementals? Or maybe both? When you say soon do you feel days or weeks? A fall to 1500 when we are on the verge of fiscal QE is a very bold call. I’d love to understand how you reached it.

    • stmro says:

      Not going to happen anytime soon with fiscal QE in Japan, soon to be followed by the EU and UK.

      We’re going to correct 5% max over the next 4 weeks, but after that we should be seeing 2250 in short order.

    • Jim Guthery says:

      Newbie, I know big money shorting market end of 3 quarter and heading into 4th.

      • fionamargaret says:

        shorting about September Jim??…UVXY consolidated…buy price is about 6..yes..6

        • senrex says:

          fiona, do you mean UVXY buy at around 6 even after this current reverse split (effective today)? Thank you.

          • fionamargaret says:

            Yes, I used the new format…but there will be chances along the way…
            Jim and I have a running joke about UVXY…..

            • fionamargaret says:

              …gives credence to higher stock prices (inverse relationship with $SPX)…
              I had mentioned yesterday I think we will correct down to 2130 or so, before continuing higher….

        • Jim Guthery says:

          Fiona, yes your call was around $5 a share – that would put uvxy around $24 a share post split.. I am looking for a 24 vix around the peak of elections. Contrary to many here, I think the markets started the year in a steep decline and will end the year the same way it started!! All the stuff in-between was just noise.

          • fionamargaret says:

            no, no, no Jim, I have UVXY going to 6, taking post split into account. 30 whatever to 6.
            Now this suggests higher stocks…quite a bit higher, if this pans out.
            Now think how this would work……what would make such a rise and when (remember I have no timeline). Folks short…and are wrong??? I knew you would love this puzzle.

            • fionamargaret says:

              ..before the split UVXY’s future was registering 0…!

              • Jim Guthery says:

                I plan on going long oil around 41 via UWTI. I will have my eye long Volatility later,. Do you see the Vix heading much lower than 10? Historically the VIx has been elevated during an election year in the month prior to election with the avg being around 24 – where would that put uvxy? Plus, look at the run up in UVXY historically after it splits..

    • mharrison60 says:

      Hi all – does anyone think strong dollar is enough to bring a correction over the next couple of months? Dollar is in an uptrend and other markets appear to be set on another round of debasement.

  16. Thanks for opening up comments – indeed it is a privilege here as you say and I fully intend to respect your intentions.

    My perspective on the S&P500 is that there has been a lot of consolidation lately — creating strong support in the 2150 ES region — that should allow for a slow grind up. Hope this comment is ok.

    Here is my short-term count on the hourly chart

  17. cj32 says:

    Cr. to CBZ

  18. alexhartley1 says:

    Tony is that a Primary C bottom being labelled on the Daily WTI chart? Bear market over? Charts are a little confusing to me but maybe I am not seeing it correctly. Shows a black ‘a’ wave going up though which I presume is corrective?

  19. opader says:

    Tony, thank you for your update and also allowing comments again. My thoughts: http://www.balancetrading.org . I believe we are in SC3, C1, P5, Major 3, Int 3, Minor 2.

  20. Arthur Knopf says:

    SENTIMENT UPDATE: Revisiting the Composites

  21. vivelaamo says:

    Thanks Tony. In the small off chance my post gets through do you feel the continued bull market is purely down to CB intervention or is there actual improvement in the economy and merit for the strong move. If the level of intervention continues could it have an impact on labelling Waves which are normally based on investor sentiment. Has their been such intervention in the past? It feels like the worst the economic and political situation around the world becomes the higher market will go. Although this probably isn’t the case.

  22. NEWBIE says:

    Not good bulls!

    • tony caldaro says:

      announced a week ago

    • vivelaamo says:

      With all due respect Newbie it seems like kind of news is actually good for Bulls. Maybe not in the long run but certainly in the short term. Brexit sure gave markets a boost and the next month from EU to relax bailout rules for the Italian banks will make sure the bull market continues. The economy and stock market are not in sync so Bulls will prosper in difficult times.

  23. fionamargaret says:

    http://www.amateur-investor.net/AII_Weekend_AnalysisJuly_23_16.htm ..a bit of history from AI

    http://tradingdiary.incrediblecharts.com/trading_diary.php ….Colin Twiggs, one of the best

    http://www.financialsense.com/ ……Acampora on 40,000…..plus more…

    Numbers say 2185 (still), 2300, 2500 (rounded out)…think we may check back to 2130 at the beginning of the week, then higher…
    CL I had as correcting to 41ish …UWTI around 20….be careful…not a determined pattern…

    Thanks Tony….and all….xxx

  24. cj32 says:

    Cr to CBZ

  25. bud67 says:

    Tony. Just wondering. Would you be interested in forming
    an SP500 OEW chart, designed for investors in the SP500 ?
    Be it weekly, monthly format is an option. I say this because.
    While I read your work, often. I get lost in the details/labeling
    on your charts. Your reply ?

  26. Thanks, Tony…….Pitch S&P 500 (Sp completed a fib sub cycle), Dow, Nasdaq, Dax, Ftse 100…
    Clx update….The weekly 34 ma congested some strong numbers and still suggests a 34 ma top in 2016….


  27. magnus1234 says:

    Tony. I’ve been a follower since 2007 and value your work. Thnx. My DAX contribution below FWIW.

    DAX30: In P5. P4 has now concluded followed by completed lower degree 1, 2 and now in 3 with target 10300.

    DAX30 1H: http://www.screencast.com/t/b0mo7fi0h
    DAX30 Daily: http://www.screencast.com/t/UW3jWQinlZT

  28. John Arella says:

    Thanks Tony, glad to see a more disciplined blog :). My take on the dow & spx is attached. Very Bullish because of the monthly Macd turning :).

    some other interesting facts

    1929 high 388 x 2.618 = 1015 1961 high was 1032

    1015 x 2,618 = 2659 close to 1987 high
    1032 x 2.618 = 2701 close to 2736 high in 1987

    2659 x 4,24 = 11274 close to 1999 high of 11750
    2736 x 4.24 = 11,600 close to high of 11750

    11750 x 2,618 = 30761 should be the next significant high or close to it

    My best guess to the next top:

  29. wanderer says:

    Tony: it would be nice to see the estimated probabilities assigned to each alternative count.

  30. ajney says:

    The US stock markets (specifically IWM) seemed to be stuck in a 4th wave, which would imply a bullish option for this week as a major energy wave is due July 27. The bullish outcome would be a dip on Monday/Tuesday and then up and away on July 27 for the fifth of the ongoing third wave. The bearish outcome would be green days Monday/Tuesday leading to a significant dip by the energy wave on July 27. The bearish outcome could either be 4th of the ongoing 3rd wave or the 4h of the ongoing uptrend that started on June 27 after Brexit. The preferred view is the short term bullish (implies Monday and more so Tuesday is red closing) as there were minor energy waves on the weekend which shall show their effect on Monday, July 25.

    Given that expected major trend for the week and next will only emerge on July 27, staying on sidelines may be a good option on Monday/Tuesday. For those who dare to venture On July 25, expect changes in intra day trend between 9:30-10:30 am and 12:30-1:30 pm.

    Chart at astroanalytics.wordpress.com

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