Tuesday update

SHORT TERM: new high then pullback, DOW +4

Overnight the Asian markets gained 0.1%. Europe opened higher and gained 1.5%. US index futures were higher overnight. The market opened one point above yesterday’s SPX 2181 close, and continued to move higher. At 10am wholesale inventories were reported higher: 0.3% v 0.1%. Around 11:30 the SPX hit 2188 and then began to pullback. At 2:30 the market hit  low at SPX 2179, then bounced to close at 2182.

For the day the SPX/DOW were +0.05%, and the NDX/NAZ were +0.25%. Bonds gained 10 ticks, Crude slipped 25 cents, Gold gained $5, and the USD was lower. Medium term support remains at the 2177 and 2131 pivots, with resistance at the 2212 and 2252 pivots. Today the Q3 GDP est. was lowered to 3.7% v 3.8%, but still over 1% above consensus. Tomorrow: the budget deficit at 2pm.

The market opened slightly higher today, made a new high at SPX 2188, then had its largest pullback since the 2148 low. The pullback so far is only 9 points. With the NYSE making a new uptrend high today and not the DOW, the same status posted yesterday still applies. Uptrend will not likely end until the DOW makes new highs. Also, this pullback can be a Minor wave 2 if it continues into the 15-20 point range. Short term support is at the 2177 and 2131 pivots, with resistance at the 2212 and 2252 pivots. Short term momentum declined after displaying a negative divergence at the highs. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: uptrend

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

About tony caldaro

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79 Responses to Tuesday update

  1. ajaysinghi says:

    Above 2196, spx tgt 2232.

  2. John Arella says:

    Looks like a fifth wave failure on the drop for both the spx and nasdaq so expect a huge rally for the next two days to all time highs.

    • ajaysinghi says:

      Again 5th wave failure?

    • I would like to see it close over 2179.then id feel we back tested the low, it held and on our ways to new highs. see what the last 30 minutes gives us

    • ajaysinghi says:


      Could you please post the chart? Your last alert on the 5th wave failure was very helpful.


    • thomos1 says:

      Where are you getting that?

      I have this as a flat SPX 2185/2177/2187, everything looks fine thus far. ES needs to stay under 2174 to maintain same structure. Tomorrow just needs to reverse without violating 2166.79 SPX and we’re clear for 5th of 5th to 2212 pivot target by next Friday.

      If SPX 2166.79 is violated then my Alt count has us in a larger flat with 2137 target. Then we’d be starting 5th wave from scratch again, same ultimate target.

      Keep OPEX structure in mind here. I favor my first levitation scenario because I doubt there’s enough time to complete the larger flat C-leg in time to establish a pre-OPEX low from which to ramp. That would also allow entry; since the nature of this rally is a squeeze, I see no reason to provide an opportunity for long entry until after the final target is reached and we’re already on the way down.

      Today was also Weird Wollie Wednesday for anyone familiar. Strong down close indicates strong up close for OPEX next Friday. Meaning one of my above two scenarios likely in play. Pre-OPEX dips have been getting shallower and shallower as of late, again consistent with this *very* mild 2-day pullback to stay within the 5th wave.

  3. phil1247 says:


    im addicted to /CL

    got in sco at /cl ext short .50 level at 42.08

    been riding it down to next ext short target at 41.40
    where .50 long from lows sits also… getting out soon

    not getting beech slapped by da boys overnite

    you have sworn off /cl?

  4. Possible formation of 3 elliott wave on the daily chart of the Dow Jones, which may lead the index to a strong achievement.


  5. johnnymagicmoney says:

    I don’t post as much (out of respect to Tony) but here is my fundamental sense in Pokémon language

    1) Europe/China/Japan is a massive Black Swan that is eluding us like a rare Pokémon but at some point Nitendo will release him and it will be easy for every one to see like a Pidgey or a Catepillar

    2) Each Poke ball is a sack of dough and the Central Bankers will throw them until there are no more Poke balls left. Now they can purchase more Poke balls left for they have a Poke Ball printing press but as this dangerous game levels up little red Poke balls become much less effective against the angry raging Monsters that are forthcoming. These angry raging Poke Monsters are a) Global Poke Economy b) Global Poke Debt c) Global Poke Deflation
    d) Global Poke Inflation. These Pokémon Monsters shrug off Pokeballs with laughter. They await us.

    3) Let’s discuss Pokémon Mathematics for a second. A) We have declining Poke productivity (think of productivity as the joy derived from playing the game) B) Rising Wages (think of this as the cost of playing this childish game) C) Marginal Sales (the Pokémon left to catch that have not been caught). It is impossible for me to keep playing when it is costing me more and more to play this silly game, I have very few monsters left to catch, and I am getting less and less joy out of it because it is costing more time and more money for less monsters. Hence I stop playing. Likewise it is impossible for companies to make more profits with declining productivity, rising wages, and marginal sales. Hence, valuation expansion has its limits and the one thing that anyone can hang their hat on (employment) will soon reverse course and like all games whether Pokémon or this big financial game we play the stock market, recessions begin at max employment as this one is as well.

    • tony caldaro says:

      there’s a simple solution
      just fire all the politicians and their staff, and productivity will soar

      • va89blog says:

        Not to mention eliminate 90% or more of the existing regulations. This more than anything is why jobs have been moved overseas the past 40 years.

    • Lower productivity is EXACTLY why the consumer has experience a surge in spending. the one sided equation never works. Called cause and affect. I stated this many months ago. the sideways 2 year action was transitional. From companies gains to consumers. It always produces problems with earnings. The end result however is totally different. It allows for accelerated spending and companies adjust their cost structure. The last 2 reports on productivity went from weak productivity to steady but still weak productivity BUT cost structure went from a 4 percent increase to 2 percent. All in the numbers. I suppose all will be shocked when the earnings side manages to jump up? the street knows these numbers very well and anticipation of a 9 percent move up in 6 months is in play. Bet against the street if you want but their analysis has been better than most individuals. Need to see sustained spending to offset higher costs. Said so many months ago when the spending was at 2 percent. now hit 4 percent.

      Why people are fixated in a one sided argument without debate or analysis is beyond me. The low productivity already produced results for the consumer. Am I the only one that sees this? The first 5 years of this recovery was totally on the backs of consumers. Everyone complained about the way companies were cutting jobs and forcing longer work hours with less pay. now the reverse happened. Nothing new. In all bull cycles. It suggests the best and last great surge is yet to come. Not in it today. I believe we need another 20 percent one year correction and then the fun begins. A long sucker indeed! perhaps one for the record books.

  6. Page says:

    SPX selling will intensify before the close, this is more than 1 day PB.

  7. H D says:

    GM Tony, all. 10 HanDle SPX range.
    Noted the 5 waves up yesterday, BOT’s hit, little front run of the 2189 sequence. Turn around Tuesday. 2168 Friday’s jobs # open is also HWB & midpoint, not by coincidence. Under that suggests more than minor PB IMO.

  8. stmro says:

    Bollinger bands are still getting narrower. Its actually absurd.

  9. minor 2 or the end of int 5?

  10. JOLTS number comes out and the world is transformed by employers looking for minimum wage workers….lol.At a Meijer store I go to,they’re having massive turnover.Lots of hiring,lots of quitting.20 year seniority people there say the 18-24 year olds don’t want to work,if there’s labor involved.Gold sells,dollar rallies.We’re booming baby!!!House flippers are rampant.Oil ignores a rise in inventories because gasoline inventories (which has one month left of driving season)drops.What’s going to prop oil up in September?Not declining rig counts-they’re rising.It’s all great comedy.

    • The financial markets are just another forum to show how irrational people are. It astounds me.

    • Connect the dots. Either ever data point is faked or misleading or we are in a real consumer driven recovery. “Openings in professional & business services, a sensitive category where gains point to general hiring strength ahead, rose 2.1 percent from May to 1.054 million. Construction and manufacturing were both higher. ” 7 years into this with a 4 percent surge in consumer spending last quarter.

  11. phil1247 says:


    support tested at 42.28 a day late …..but held

    short from most recent high is breaking

    looks like /cl is ready to blast above 18d and get moving higher

  12. captbara says:

    DXY in a bit of trouble here with only 3 waves up from 95..

  13. shauryagh says:

    The 1 Yr Libor at 1%! Per Tony’s excellent structural analysis of importance of 1 yr rate vs FED hikes the FED is 75 bps below appropriate rate….This very likely points to the market anticipating inflation headwinds ahead…Will likely see a decent bear market rally in commodities this winter assuming FED really holds till Dec…if I had to pick any one commodity randomly purely based on gut feel that would outperform the rest during the winter rally ..it would be copper….

  14. stmro says:

    Gold up
    Oil down
    Dollar down
    Risk currencies down
    Yields down, globally
    Equities down, globally (but marginal)

    SPX up.Yep, makes sense.

    Jokes aside, downside break seems more likely to me than upside.

  15. LBHK says:

    Hi Tony, wondering whether Int A looks a better count for WTI @ $39.19, rather than Major B? $39.19 was barely 50% retrace of the Feb-Jun rally. A deeper retrace to mid-$30s would fit better imho

  16. fionamargaret says:

    Thanks Tony.

    • stmro says:

      People have been drawing these pretty little long term trendlines for years. What makes this one different and why should it provide resistance. In fact there are only 2 prior touches – doesnt seem so significant.

  17. 123 abc says:

    Thank you Tony et al, great OEW guidance.

  18. stmro says:

    This listlessness is painful. With OPEX coming up, we might not get a sustained break in either direction until week 4 of August.

  19. Page says:

    Thanks Tony.

  20. soulsurfer says:

    thanks tony!

    negative market breadth and negative divergences once again align. Always good for some fireworks. Hence a retest of 2135 in the making!?


  21. blackjak100 says:

    TC, why the change in tone lately by saying the uptrend is likely incomplete until all indexes make new ATH? That never was your style so I’m just curious because the DOW may have a truncated 5th

  22. I’m going to sound like Bulkowski,but GDX has two ways to go. $XJY has a gap 2.5 pts down from here(at 96)that most likely gets filled soon(based on the usual 3 week gap filling pattern).However,my Groundhogs day scenario(6 more weeks of rally,after dropping below and then above the 20d sma),doesn’t fit with that.So either that gap at 96 gets filled and GDX drops below the 20d sma,or the gap gets ignored and GDX moves up with $XJY.I guess if a Fed head of any significance opens their yap to push for rate hikes,we’ll know the answer.Either way,at $XJY 96,I’d buy more GDX for the next move up.Also silver weekly seems like it wants to complete a C&H to 22,with an ultimate move to 30.Gold to 1460-1480?
    Goldfingers crossed.

  23. gtoptions says:

    Thanks Tony
    The high profile Bears (sell everything) are out in force. It’s truly a shame.

  24. captbara says:

    Update from the weekend chart

    Likely to break but we’ll see. Wave count wise, the bear setup here is about as good as it gets, if they want it.

  25. bouraq says:

    Chart of the day is $ES by http://www.tradingchannels.uk

  26. Mentioned a while back it is a dull market with a steady strong bias forward. Hard to make money on short term bets. The early phase of the breakout was your best chance. Until the next decent correction I will counter punch unless I can see the first move coming. So far its not happening.

    if anyone still doesn’t trust this breakout you go against so much historical data that the odds would be too unprofitable. I stated over 3 months ago, based on anecdotal evidence that consumer spending will accelerate. It now has to hold at high levels or earnings expectations will be lowered and so will market complacency.

    Boring stage of uptrend before the 5 to 7 percent correction takes place. Expect it by end of month but just a guess right now.

  27. Tony Jordan says:

    TC your DAX chart puts the index in Major 3 of PV. Major 3 is still nearly 3% shorter than Major 1 and the index is nearly 1700 points from the peak of PIII. Can’t argue with the count and I think it has very bullish implications for equities in general for some time. This is yet another warning for bears. The day of Armageddon awaits … but perhaps not in our lifetime.

  28. mike7x says:

    Thanks Tony! Beware the August VIX. The Fat Pitch:
    “All of this is taking place as SPX moves to within 1% of the next “round number” milestone of 2200. A reminder: SPX has had a consistent tendency to react as it approaches each new “round number” milestone for the first time. The smallest reaction (2%) was in 2013 at 1800. Most often the reaction is more than 3%. The last two were 10% (at 2000) and 6% (at 2100). A move to the Bollinger middle band now implies a correction of about 4%.”


  29. Tony…thank you for the update. When this last wave completes for the SPX…
    1. If it is intermediate wave “a” of major wave C ..would you expect a 38.1% pullback for wave “b” of major wave C?..or
    2. If is it minor wave 1 of major wave 3 of primary wave V, would you expect a 50% pullback for minor wave 2…or
    3. I am completely off base?

  30. Ajney says:

    Thanks Tony. Since the energy date on the weekend equity markers in US have stalled. On the other hand TLT continues its advance. Next energy dates are on Thursday/Friday. May one day maybe both. Will know more tomorrow. Tomorrow’s bias is positive for second half after 1 pm. Some selling maycome in earlier part of the day.
    Details: https://astroanalytics.wordpress.com

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