Wednesday update

SHORT TERM: choppy FOMC day, DOW +22

Overnight the Asian markets were mixed. Europe opened lower and lost 0.9%. US index futures were lower overnight, and the market opened 2 points below yesterday’s SPX 2178 close. The market continued to pullback until 11:30 when the SPX hit 2169. Then ahead of the FOMC minutes the market started to move higher. At 1:30 the market hit SPX 2179. At 2pm: Right after the release the  market dropped to SPX 2172, and then started to rally. In the last hour of trading the SPX hit 2183, then closed at 2182.

For the day the SPX/DOW were +0.15%, and the NDX/NAZ were +0.10%. Bonds gained 5 ticks, Crude rose 30 cents, Gold was flat, and the USD was lower. Medium term support remains at the 2177 and 2131 pivots, with resistance at the 2212 and 2252 pivots. Tomorrow: weekly jobless claims and the Philly FED at 8:30, then leading indicators at 10am.

Today’s continuation of yesterday’s decline eliminated the potential Int. v diagonal scenario quite early when the SPX hit 2172 in the opening minutes. At that time we posted an A labeling suggesting the uptrend may have topped at SPX 2194. We have also posted a less likely Minor 1 with an irregular Minor 2 scenario labeling as well. We were expecting this fifth wave up from SPX 2148 to be the shortest, as the 3rd wave was shorter than the 1st wave. Although not this short. With the characteristics of the uptrend changing, and negative divergences on the daily charts, it would appear a downtrend may be beginning. Short term support is at the 2177 and 2131 pivots, with resistance at the 2212 and 2252 pivots. Short term momentum bounced from extremely oversold to nearly overbought during the rally. Trade what is in front of you!

MEDIUM TERM: uptrend may have topped

LONG TERM: uptrend


About tony caldaro

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115 Responses to Wednesday update

  1. Anyone know why 10 year bond yields are down on a day when the economic data was pretty good?

  2. rd3777 says:

    They say never short a dull market. Next week is Jackson Hole Yellen’s speech.

  3. torehund says:

    1D chart dollar index has retraced in an abc, behind it is two waves up. Careful with oil here.

  4. cj32 says:

    Cr. CBZ

  5. captbara says:

    Didn’t really believe the IHS pattern in CL would actually build up to this point a few weeks back, but here we are, and what a symmetrical beauty it is.

  6. phil1247 says:

    anyone hear a swooshing sound ??

  7. Lee X says:

    Hey Tony headed out on a multiple state State Fair adventure, not my idea but hey I like corn dogs.

    Great job on CL again !

  8. phil1247 says:

    mr 10 point

    es 2184 ……2174 ?

  9. phil1247 says:


    if buyers dont step up now

    big swoosh down coming

    bearish below 2185 es

  10. phil1247 says:


    48.77 target near

    ready to take profits here on 1/2 remaining UCO

  11. SPX weekly 20 year chart….this is what i call R….notice that in 2015 we struggled against the tl for about 6 mos and failed. We now have 2 tl intersecting at our current high…..

  12. Third day running…gold has a wall at 1357-1360.Meanwhile,last night, $XJY took a run over 100 before being slapped back.Fed has quite a decision to make at Jackson Hole…go for the lower dollar and Nikkei plunges.Go for a higher dollar and we sell off.Or do they all go to their podiums and pretend their microphones don’t work. (My recommendation. and for P&F breakout–1380,are hurdles to get by.At this point,gold is a coin flip.

  13. kjb0 says:

    Well it looks like everyone has the market right where it wants them. Just accumulating dumb foreign money. I will be the first to tell you that nobody knows what the market is going to do.That should be evevident to everyone on this site by now. I wouldn’t give up on the bear count just yet Tony. I doubt we get through September without the start of a major decline. Just sayin.

  14. vivelaamo says:

    Petition in UK for BOE to end QE. Needs quite a few more votes yet though.

  15. virginia avenue says:

    terrific site – thanks for providing such helpful information – I’m still learning about all this, but have one question: Do option expiration dates (including triple & quadruple witching) have any recurring effects during any specific wave? Thanks!

    • cosmos77 says:

      Thanks Fiona. Interesting charts, Looks like EEM has completed wave 1 of 3 and may pull back, but looks like the best is yet to come. Tony highlighted the breakout of emerging markets in early July. Also, maybe time to accumulate a little EFA. I might need to open an account at RJ to have access to their commentary and charts.

    • locanbbs says:

      Great charts! Thanks, Fiona!

    • vivelaamo says:

      Thanks Fiona. Great charts. I like Raymond James.

    • rd3777 says:

      Thanks Fiona for posting….The Shanghai market should rally as the Renminbi is included in the IMF SDR XDR basket on October 1st I believe. Should be bearish for the $,the overall effect on our market should be interesting. As the world transitions from the present floating system to the XDR over the next 18 months.

      • rd3777 says:

        The XDR tends to fly under the radar….but the smart money is well aware of it’s planned implementation. It is part of the long term economic plan for the future of the NWO financial system. The XDR will be the foundation.

        Deutsche Bank proclaimed the following:

        “The conclusion is that without an external economic shock it is hard to see policymakers being prepared to take dramatic, fiscal action to jumpstart the global economy and bounce it out of a financial repression defined by low and falling real yields to one that at least initially is defined by rising nominal yields through higher inflation expectations. Ironically the shock that is needed would require a collapse in risk assets for policymakers to then really panic and attempt dramatic fiscal stimulus.

        The logic would also fit with the same correlation structure for financial assets – a un-wind of the falling yield/rising equity market where all financial assets trade badly. In other words the end of financial repression will see price levels fall so that yields once again look attractive. For such a move to be sustainable itself requires the economic fundamentals to shift – inflation needs to be more secure against an underlying backdrop of robust real growth. Most people now understand that this is not a job for monetary policy alone. Yet the current reach for yield simply prolongs the status quo for policy disappointment.”

        What Deutsche Bank is saying in a nutshell is financial instability is coming. The CB’s need it….because without it the IMF/CB plan for the XDR cannot be implemented.
        So I would not rule out a major market decline soon….as seasonality is ripe for a decline in a tired over extended market….the setup in a divisive election season is there. If not soon then surely in the 1st Qtr of 2017…IMHO

        • rd3777 says:

          And do not think that this 8 year QE induced rally was not planned for a reason that goes hidden from most….these planners think in generational terms ,if not in multi gen planning…I do not think that standard monetary policies were abandoned solely because of 2007….all the old guard is not dead yet….they know what they do.

  16. locanbbs says:

    Thanks, Tony, it looks like the uptrend is only going on “fumes”. The party’s over, but the guests refuse to leave and “drinks” are still being served, though everyone’s past his/her limit. I see here only “downtrend”; still all indicators are bouncing off “overbought” (see white box):
    Spx – hourly futures –

  17. Can someone please tell me how to post charts here? I don’t see any add or attach media buttons, or any other means of uploading an image in the comments field.

  18. Hi,Tony,divergence in the macd histogram(weekly),thanks

  19. 123 abc says:

    Thank you Tony et al, great OEW update, much appreciated.

    Should the less likely count be correct and underway in the following charts, then going long now with a stop below today’s low may offer a favourable risk/reward trade for the bulls.

  20. Scott C says:

    Hi Tony/OEW Team,
    Ok so i am writing now hoping that my uneasiness and wanting to capitulate is a sign that we are close to the 50/50 winning out without crazy upside… Away I go with my frustration – hoping that is not taken the wrong way (bad way):

    I have been a bit confused and frustrated when we are in a favored count of the bifurcated market, yet it is 50/50….

    …when it is written that we may have completed an “a” wave only (was it 5 waves btw?) as a primary for today, yet we post the 1 2 in *blue* which makes it look like that is favored since it follows the primary counting on the 60 min….

    …when it is written in comments by T that I have seen twice at min (and then the monthly MACD statement yday where it is turning up) that the charts looks impulsive (bullish) and not equating to the bifurcated count yet it is kept as the primary count.

    I realize that I am nothing special nor an important stakeholder in the way this free and valuable site works and provides…,but is the B wave/NYSE bifurcated count not making sense anymore at all as it seems we are constantly trying to push the count to highs. Are there other indicators that are going off that are winning here for bullishness, yet we are waiting for the violations of two spx values to recognize those? The recent wroc indicator that came out of nowhere turned this whole thing upside down imo and seemed to be a late indicator (although it was below the breakout above ATH) — i wonder if i am going to see that happen again with the counts and we switch over to a super bullish count with no reprieve… Are any other OEW indicators winning out to abandon the 50/50 primary count where a determination can be made sooner than later or does it just boild down to the two spx values that are higher (purposely not posting them)?

    getting off the couch now….

    • tony caldaro says:

      Hi Scott,
      There are three counts presented … all still suggest higher prices ahead.
      The cut off for the bifurcated counts is SPX 2335.
      After that the more bullish P3 count takes precedence.
      Personally I do have some indicators suggesting the P3 count is more probable.
      But just taking it one step at time.

  21. Ajney says:

    We are now entering the important part of the week. Our three energy dates generated movements in the last three days in various markets. Significantly, in equity indices, since the major energy date on Tuesday, we have not been able to regain a major trendline on DOW. Tomorrow may be in green as we do not have an energy date. However, that would, according to us be not so good news for the bulls as we have a major energy date on August 19 would expect a 4-5 day selloff in the market subsequently.
    Bulls hope scenario: (Ironically) Tomorrow is a red day.
    Silver hit an important trendline and bounced off.
    Details at

    • ajaysinghi says:

      Impressive work these days. Today is a down day. We are up again next week.

      • Ajney says:

        Thanks Ajay. Selling today/and or tomorrow should preserve the Aug. 2 low for a third of fifth rampup next week. My bias is that the red futures will ease up sometime after open/maybe even go green and then late afternoon selling pressure may come in again.

        • ajaysinghi says:

          I think there is an ed from 2148(if the top is not already in). If we do make a new high after today, first halt of spx would be 2145. Overall September is also a bullish month. Fall is in October.

          Check your energy map for September 1st and last week and first 3 weeks of October.

          • Ajney says:

            would imagine so. Tony’s pivots are great at braking uptrend and downtrends for rentries and further action. Our imp. energy dates are fixed, price action and some other factors decide our bias going into them. The longer the duration between major dates, better chances of trending price action. we don’t have a bullish/bearish bias for months in particular.

  22. rd3777 says:

    Thanks Tony, could have topped,but the market needs one more rally…I think. Todays action could have set up one final zig-zag up or at least a 5 wave up….we shall see….

  23. mtu MTU says:

    [EOD] Stocks-
    Potential 5-down & 3-up (Chart 1 blue). Chart 2 shows near term options. The immediate bullish count is the small-degree EDT highlighted in Chart 3. Meanwhile, ES is kissing prior support, now potential resistance (green line in Chart 4).

  24. vivelaamo says:

    Thanks Tony. if we don’t get another lower low by the end of the week I’ll be confident enough to say this pb is done.

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