Tuesday update

SHORT TERM: gap up opening then market stalls, DOW +18

Overnight the Asian markets lost o.2%. Europe opened higher and gained 0.7%. US index futures were higher overnight and the market gapped up to SPX 2192 at the open. The SPX had closed at 2183 yesterday. At 10am the SPX hit 2193, new home sales were reported higher: 645K v 592K, and the SPX hit 2193. Then the market started to pullback. The pullback continued throughout the day into a SPX 2187 close. Fairly quite after the open.

For the day the SPX/DOW gained 0.15%, and the NDX/NAZ gained 0.25%. Bonds lost 1 tick, Crude rose 55 cents, Gold was flat, and the USD was higher. Medium term support remains at the 2177 and 2131 pivots, with resistance at the 2212 and 2252 pivots. Tomorrow: FHFA housing prices at 9am and Existing home sales at 1oam.

The market gapped up at the open for the first time since August 11th. After the opening the market ticked up a point and then began to pullback. The August 11th gap up led to the SPX 2194 high two days later. It is possible the ending diagonal fifth wave scenario is underway. If correct we have a possible scenario for the five abcde waves: 2194-2169-2197-2183-2200. Thus far only 2194 and 2169 have completed. Short term support is at the 2177 and 2131 pivots, with resistance at the 2212 and 2252 pivots. Short term momentum was quite overbought at the open then eased back to neutral. Best to your trading!

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

About tony caldaro

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112 Responses to Tuesday update

  1. gtoptions says:

    Thanks Tony
    SPY ~ WR1 to WS1
    Flat 2 or b of ED?

  2. phil1247 says:



  3. torehund says:


    on 1W chart, 2 larger waves up, retraced and then 2 smaller ones up (sizing the fractals is difficult).
    This could be mounting up to the much talked about Euro plunge, gold and crude will then also tend to follow.

  4. micky says:

    Not looking good for my remaining longs,A lot will depend on the bounce if/when it comes

  5. phil1247 says:

    added SPXU

  6. Everyone is getting out of GDX at once today.Newmont down about 10%.Wish I had zero exposure,but cut down from 50% to 10%.Still a spanking.Now is this capitulation?Stay tuned.

  7. phil1247 says:

    raised stops in sds to lock in 3c profit

    no breakdown in es

  8. Hugh Jazole says:

    Forgive my ignorance. What is the difference between an uptrend and a bear market rally?

    • tony caldaro says:

      Uptrends occur in bull/bear markets and last for weeks to months.
      Bear market rallies can include uptrends and downtrends and last for months to years.

  9. mtu MTU says:

    [225pm] SPX update –
    A five-wave decline from yesterday’s high (Chart 1). Chart 2 presents bull and bear options.

  10. phil1247 says:

    /es short target 2176

  11. captbara says:

    Rate hike is coming…
    USD stick saved exactly where it had to.

    • Page says:

      May be in Dec (not before election), however if no hike in Dec then kiss good bye to rate hikes even in 2017 because things will get pretty ugly after election.

  12. mjtplayer says:

    Wow, just when you thought this market couldn’t get any more boring. Yellen speaks at 11am on Friday, might as well turn off the monitors till then.

  13. johnnymagicmoney says:

    AAMikey – may I ask where you see the current count on the S&P ??

  14. Silver led down,watch a turnaround there first.GDX RSI at 19.81.

  15. phil1247 says:


    1329 short target hit

    now bounce or collapse in extension shorts like silver?

  16. mtu MTU says:

    [1012am] SPX update –
    No follow-through on yesterday’s mini-breakout. Now retracing to fill the gap and probe for potential support around the breakout area. See chart.

  17. phil1247 says:

    / SI

    silver collapse continues

    extension shorts are obvious

    gold still in traditional shorts

    rather trade trending products
    than be chopped up in stocks …eh HD???

  18. magnus1234 says:

    Thanks alot TC for the 11 yrs of sharing your analysis and at the same time for the 8+ yrs I have been following your blog. Merci beaucoup!

  19. interesting to see what happens at 10:30. if oil sells off or not, cant imagine oil going back to 50 and stocks sell off, but you never know, would assume oil and stocks sell off. sets up an interesting day.

  20. Jim Guthery says:

    I am looking at picking up some volatility at some point today. we “could” have a quick 5% drop.

  21. Tony Jordan says:

    A belated happy blog birthday TC. May the gods grant you many more bull markets, continued wisdom and good health.
    Looking now at the Daffy DAX futures, I’m counting the decline from the 10802 15th August high as 5-3-5 down complete (A) with the index now in c of B noting that a of B bounced to 10654 with today’s high so far 10652. So a little more to finish off all of B. If I’ve got my count right the DAX should not go higher than 10693 on this B wave. Also expecting Wall Street to retrace some of yesterday’s decline in a small degree B wave and then both markets should align in a C wave down. Tricky, undecided market with lots of 3 wave moves. Will likely resolve with a “pop thru the top” and then a larger decline degree unknown.

  22. Thx Tony 🙂

  23. If gold hasn’t topped at 1377,then you have to assume it’s -at least-going to the mid 1400s and possibly 1550.If this B wave isn’t done,I’ll throw out a couple ideas . Gold just dropped $50 below its 50d in June.Looking back in the 2008-2011 uptrend there was one time gold went as far as $75 below the 50d…and not for long–and the next time was a higher low (maybe $40 below).With everything all about Yellen this next couple days,and the 50d at 1332,we either have a rally here,or a fake break 20-30 dollars below 1332 and a rally back to 1377 and above.
    Yellen dovish=rally
    Yellen hawkish=sell,then rally.
    …and the first to second week of Sept starts a 6 week extremely bullish period of timr for gold—like Christmas for equities.Good luck all.

  24. fotis2 says:

    Well done on 11years of sharing knowledge and counts Tony!Wish you many more to come.

  25. pete8675309 says:

    Congrats on 11 years! You’ve made some great calls starting with the crash of ’87. Thanks again for sharing your wisdom and insite into the markets. I wish you the best and the best to OEW nation!

  26. zvyezda says:

    Tony, congratulations on eleven years of selfless giving and providing a meeting ground for usually like-minded souls. Thank you so very much!

  27. cosmos77 says:

    Thanks Tony for sharing your knowledge and experience. I would be lost without the daily and weekend updates. All I can hope for is that you keep it going for another eleven years and wishing you the best and prosperity to everyone.

  28. Ajney says:

    11 years of great posts is awesome! Congrats Tony!

  29. stmro says:

    Another pointless day. The only things trading are the bots.

  30. fionamargaret says:

    Raymond James have really outdone themselves…oil, inflation, charts galore…..present/future outlook..42 pages….thank you.


    Thanks Tony….and everyone.

    • cosmos77 says:

      Thanks for sharing Fiona. Very bullish scenarios. Supports Tony’s recent analysis. I’m having a hard time believing the market can be that bullish with the world economies in such a mess, which is probably why it can and will.

      • Cosmos, I agree, the world economies are a mess. SPX earnings have dropped for 5 consecutive quarters, and (GAAP) PE is over 25. Central bank intervention is the only thing that keeps markets from falling apart.

        But most market SMA/EMA trend lines are sloping upward, and the TINA and FOMO psychological aspects could keep equities rising.

        Personally, I see a 20% correction on the horizon in the next 6 months. JMO

    • aahmichael says:

      I’d like to point out an example of just how absurd some of this report is. On page 13, they present a chart showing that SPX, DOW, and COMP have all broken out to new ATHs. Then they state the following:

      “Now that the NASDAQ Composite Index (black line) has joined the S&P 500 (blue line) and Dow Jones Industrial Average (red line) in making new all time highs, all three major indices are literally in uncharted territory with no price resistance above current values.”

      That’s right folks. Raymond James has proclaimed in this report that there is no price resistance above current levels, which means that prices are now in the free and clear and there is nothing that can stop prices from going to infinity.

      • Yes, that is the bull argument, cleared 2134 and earnings were not as bad as they could of been even on reduced estimates and there is no place else to put your money. So blue skies ahead. It could be or could not be. But that’s the argument.

        • aahmichael says:

          My point is that there is ALWAYS price resistance in every market, even when that market is at ATHs. One of the great things about EW is that it identifies where that price resistance is, even if prices have never reached those levels before. Raymond James has done a terrible disservice to its clients by treating them like idiots and telling them blatant lies about how markets work.

          • vivelaamo says:

            If a trader does not use EW then technically there is no resistance at ATH’s to speak of. Obviously it doesn’t mean the price will go up forever it just means they can’t pick a target for a top based on resistance. I don’t see anything absurd about that.

            • fionamargaret says:

              …I took more exception to the categorization of “Raymond James doing a terrible disservice to its clients by treating them like idiots, and telling them blatant lies”…..
              disagreeing is one thing but casting dispersions is another…

            • aahmichael says:

              Saying “there is no price resistance above current levels” is quite different than saying “we don’t know where the next price resistance is.” RJ chose to make the first statement which is a lie, and it could easily lead to them being fined by the government and/or eventually being sued by clients who invest new money at these levels based on this lie. The “sell side” of this business is highly regulated, which is why all of the “sell side” firms are run by their Compliance Departments. Nothing is ever put out to the public that isn’t first approved by Compliance. My guess is that Compliance missed this statement, and that error could easily end up costing RJ many millions of dollars.

              • RJ is correct in saying “no resistance” until a new resistance area develops.

              • aahmichael says:

                re: “RJ is correct in saying “no resistance” until a new resistance area develops.”

                That’s not how it works in this business. Words have meaning, and the way they worded it means that they are saying that the market will go to infinity, since they are claiming that there is no price resistance at any level above current levels. So, any RJ customer who invests new money based on that statement is literally guaranteed not to lose money, because if the market does turn and go down, no matter how far down it goes, those clients can file a complaint and they are guaranteed to win in arbitration. Their complaints would be a slam dunk.

              • fotis2 says:

                re:”Those clients can file a complaint and are guaranteed to win in arbitration”Is this just your opinion or do you have knowledge of actual cases where clients have taken their investment advisor to court and won.I mean if you could take a financial advisor to court every time you think the wording in an analysis has led you to loose money in the Market than we all are in the wrong business…

              • aahmichael says:

                Fotis, it’s not just my opinion. I’ve been in this business for 30 years, and I am thoroughly versed on what a brokerage firm (and their financial advisors) can and can not say in their marketing material. As I said before, these firms are run by the attorneys in their Compliance Departments, and nothing is allowed to be published or presented to the public without prior Compliance approval. There are many different ways that RJ could have worded that sentence, but they chose the one way that it can never be worded. It’s a total breakdown in their organization, because it somehow made it through Compliance approval.

              • fotis2 says:

                Ok Thanks for the answer it seems that brokerage firms have very strict rules of how to run their business.

      • fionamargaret says:

        …I do not agree with everything in life Michael, but the charts are offered as a gift, so I take them in the spirit of giving, ..thank you Raymond James.

    • After a week setting up, the Bat pattern I posted last Thursday finally kicked in yesterday, now for the ride down to SPX 2091…

    • There actually is resistance at these ATH, as was noted in a chart by Nasim Taleb posted here recentaly and also one posted here a few days ago. The ATH have not surmounted some long term trend lines and are in a “kiss goodbye” scenario until they do. So, apparently the Raymond James report is wrong for that simple reason. Unfortunately, there doesn’t seem to many accurate opinions or reports either in the media or the financial arena. .

  31. CB says:

    Tony, thanks for all the work you. Much appreciated.

  32. xpto31 says:

    Congratulations tony for This 11 years! Tony for president of the US!!👏👏👏👏👏👏

  33. Ajney says:

    We expect tomorrow to be green in equities. Major energy date on August 25 will likely influence several markets. We are however seeing energy signatures late this month and next that have convinced us to stay on sidelines in equities, atleast for the long side till October second week.
    Bonds and gold forming a triangle that may resolve synchronously.
    Details at https://astroanalytics.wordpress.com

  34. bouraq says:

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

  35. Scott C says:

    Hi Tony – if this is an ED in the SPX – does that mean the B wave count can be considered complete and we would need validation below the Brexit Low for confirmation or something earlier??? Also, would you count the NYSE in a different type of count?? Or is this wave 1 of your uptrend and we have a pullbackfor a 2?

    I am trying to be clear in my understanding about what this means in your counting as this weekend gave us a lesser chance for the market to be in a bear market (even more confusing with 33/33/33). Is it possible that the 2 in the Dow can be an A of your super cycle 2?

    Also, in regards to the 33/33/33
    33% B wave — this means a Bear Market Continues?
    33% NYSE — this means a Bear Market for a 2 in NYSE iif we get a final 5 complete?
    33% Dow — we are already in the third.

    Congratualtions on 11 years. Pretty cool to contriubte to so many for so long day at your expense day in and day out.


    • tony caldaro says:

      The ED is only for the fifth wave of this uptrend … nothing bigger
      The NYSE still needs to make new highs … 3% short
      SPX count suggests when B is over C down will commence
      NYSE count suggests when P 5 is over bear market will follow
      DOW count suggests P 3 has a long way to go yet

  36. vivelaamo says:

    Thanks Tony. Technically you have to favour going short from today’s high but it all seems way to obvious to me.
    Expect an attempt at 2200 by the end of the week.

  37. 123 abc says:

    Tony et al, has it been eleven years since the first OEW public post?! Thank you for sharing the the excellence of OEW theory with the world; best wishes to friends & family, and the OEW team. Always enjoy leafing through the historic OEW treasure trove archive…

  38. aahmichael says:

    From my perspective, the market did enough today to signal a top, and I can now count a potentially completed ED from the 1992 Brexit low. Today was a carbon copy of last Monday. Both days had a strong gap open with an early surge, that then became a shooting star by the time the day closed. Also, both days took the McClellan Oscillator above the zero line intraday, but by the end of the day, both days failed and couldn’t close it in positive territory. (The bullish alternative is that today was just another completed B wave and more subdivisions are still to come.)
    Here is a repost from last week. Everything remains the same, except the island reversal was filled today:
    aahmichael says:
    August 16, 2016 at 5:05 pm
    Lots of things lined up yesterday to lend credence for a top being put in.
    1. Yesterday’s high hit the trendline connecting the 4/20 high to the 7/20 high.
    2. The 1.618 extension of the Brexit decline (2113-1992) was 2191
    3. The 1st Brexit rally wave was 117 points, and yesterday’s high was 119 points from the subsequent correction low.
    4. The McClellan Oscillator went below the zero line on 7/25. The next day it closed at 0.967, but then it immediately went back below the zero line and has never been able to cross into positive territory again, despite the market’s 10 day 47 point rally.
    5. As others have mentioned, yesterday was a daily shooting star candle, which then turned into an island reversal in SPY with today’s action.
    6. Ever since SPX cleared 1200 back in October 2011, it has never gone straight through a new round number (other than 1500) without first having a sizable pull back each time it got close to the next round number. 2194 might have been close enough.

  39. phil1247 says:



    keeping with the commodity theme……

    extension long has failed

    support drops to 16.53
    little support below current levels could lead to a severe plunge
    although gold is holding its extension long…..
    silver collapse would probably drag gold down with it

  40. micky says:

    Tks Tony, resistance at 94 held so far, as a swing trader I would have taken most off but no reason to short yet.

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