Friday update

SHORT TERM: gap up opening, DOW +165

Overnight the Asian markets lost 1.1%. Europe opened lower but gained 0.3% when Deutsche Bank’ stock reversed higher. US index futures were higher overnight. At 8:30 personal income (0.2% v 0.4%)/spending (0.0% v 0.3%) were reported mixed, and PCE prices were higher: 0.2% v 0.1%. The market gapped up at the open to SPX 2165, then dropped to 2158 just before 10am. The SPX had closed at 2151 yesterday. At 9:45 the Chicago PMI was reported higher: 54.2 v 51.5, then at 10am consumer sentiment was reported higher: 91.2 v 89.8. The market then resumed its rally into the afternoon, hitting SPX 2175 by 3:30 before closing at 2168.

For the day the SPX/DOW gained 0.85%, and the NDX/NAZ gained 0.80%. Bonds lost 12 ticks, Crude rose 15 cents, Gold dropped $4, and the USD was lower. Medium term support remains at the 2131 and 2116 pivots, with resistance at the 2177 and 2212 pivots. Today the Q3 GDP estimate was lowered: 2.4% v 2.8%.

After yesterday’s afternoon negative news on Deutsche bank, the news turned not so negative this morning and the stock/markets reversed. Instead of heading lower the market rallied back into the 2177 pivot range, after being quite oversold at yesterday’s lows. Since the SPX 2120 low this advance has been quite choppy. All rallies have been sold creating a series of overlapping advances up to SPX 2180, and even after that high. This certainly does not look like an impulse wave. Will cover the implications in the weekend update. Best to your weekend!

MEDIUM TERM: corrective activity continues

LONG TERM: uptrend


About tony caldaro

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31 Responses to Friday update

  1. vivelaamo says:

    Continues like this much longer than it’s likely we will see a sharp move down. In the mean time great for scalping.

  2. micky says:

    Thanks Tony
    I agree on corrective behaviour, looking like we are busy or done with another b wave of smaller degree, with its a at 2140.

  3. kvilia says:

    All right, Tony. So let’s take the OEW aside. Deutche has leverage of 40, Lehman had 31. Central banks are killing banking business with zero rates, Wells Fargo is another example. 2008 began with banking crisis, 2016 – ?
    So how in the world can anyone calculate high probability of expanding bull market? Isn’t bull about growth? Why do you think Trump is running for president? I just think there is enough evidence to be at least cautious going forward.
    Holly, the turn is yours now, and I’m going to bed.
    Will be reading weekly update first thing in the morning – thanks, Tony!

  4. NEWBIE says:

    I reached out to my friend and asked him if the market is going down BIG next week and this was his response.

  5. fionamargaret says:

    ..postcard from Berlin…..x

  6. If Obama could order his D of J to cut the fine for DB,is it far fetched to believe he and AG Lynch said” Don’t indict Hillary”?Now Zerohedge is saying,this deal may not materialize as rumored.Interesting Monday,if not.

  7. blackjak100 says:

    Thx TC! Mr Handyside is thinking exactly like you and myself. I shorted the close again after taking profits near thurs low after shorting Wed close.

  8. captbara says:

    Good to see everyone has remained bearish 👍 This leaves the door open for 3rd wave of 4th degree.

  9. Thanks Tony. I will leave the EW counts to you and others but will share an upward sloping diagonal channel that explains most recent price behavior and which may be turning into a bearish wedge. Today’s high was seen during the last ten days of July but I think we need to visit 2177 to close a gap to “officially” allow us to to visit the likely lows that await us.

  10. Thanks Tony. I will leave EW counts to you and others but will share a diagonal channel that seems to explain much of the recent price behavior. In recent days, the support line has become more aggressive suggesting this is taking on the characteristics of a bearish wedge. 2175 was the top in the last ten days of trading in July but I think we need to visit 2177 to close a gap before we are free to visit the lows that likely await us.

  11. What’s with the fed trying to keep backstopping the market on CNBC they were saying fed wants the option to buy equities in a down turn. Do they know something we don’t. Was that revised gdp original estimated to be 4?. Interesting times.

  12. 123 abc says:

    Thank you Tony et al for the excellent OEW daily updates this choppy week.

  13. cosmos77 says:

    Thanks Tony. I’m looking forward to the WE update

  14. mtu MTU says:

    MTU weekly commentary – Monthly Outlook Update (9/30/16)
    Stocks, Bonds, USD, Gold – key intermediate term scenarios to watch

  15. pooch77 says:

    This should make Newbie happy…were going down next 2 weeks

  16. rd3777 says:

    Thanks Tony,
    This market is a cluster….that’s all.

  17. Lee X says:

    Thanks Tony

    I love Popeyes chicken and pivots on Fridays.

Comments are closed.