Tuesday update

SHORT TERM: gap up and go Tuesday, DOW +115

Overnight the Asian markets gained 0.4%. Europe opened higher and gained 0.9%. US index futures were higher overnight, and at 8:30 export (-0.1% v 0.2%)/import (-0.1% v -0.1%) prices were reported lower. The market gapped up at the open to SPX 2265, and continued on to 2273 in the opening minutes. Then after a pullback to SPX 2265 by 10:30 the market moved even higher. At 1:30 the SPX hit 2278, then pulled back for the rest of the day to close at 2272.

For the day the SPX/DOW gained 0.60%, and the NDX/NAZ gained 1.10%. Bonds were flat, Crude ended flat, Gold slid $4, and the USD was flat. Medium term support rises to the 2270 and 2212 pivots, with resistance at the 2286 pivot. Tomorrow: retail sales and the PPI at 8:30, industrial production at 9:15, business inventories at 10am, then the FOMC rate decision at 2pm.

The market gapped up today opening at a new all-time high, rallied further, retested the open, and moved even higher. While the DOW closed in on 20K (19,954), the NDX finally exceeded the 4912 October high after much post-election selling. And, the NYSE finally made an all-time new high, although by just one point. The third wave (Minute iii) of this uptrend continues to impress. Short term support is now at the 2270 pivot and SPX 2252, with resistance at the 2286 pivot. Short term momentum was quite overbought early and ended at overbought. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: uptrend

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

About tony caldaro

Investor
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147 Responses to Tuesday update

  1. Page says:

    Gold target 1080-1050. (NUGT 3. JNUG 2.)
    SPX 2180.
    WTIC 49.

  2. lunker1 says:

    Blind squirrel strikes again

    lunker1 on December 13, 2016 at 9:25 pm
    just a WAG….
    2252 was nano 4
    tomorrow micro 4 to the prior 4

  3. vivelaamo says:

    Cable to test the Oct trend line overnight. I think it will break and we test the Oct low again.

  4. EL MATADOR says:

    Tony, U$D breaking long-term resistance 103…choo-choo!

  5. Bud Fox says:

    SSO OBV top at 3:41 pm eastern

  6. vivelaamo says:

    Don’t tell me thats it??

    • johnnymagicmoney says:

      if it is it just goes to show you how much of a joke this market is. Market is irresponsible and controlled by greedy fukks that always push it too far creating a big pop destroying wealth for the majority of Americans. Hardly any control of all of the programs steal from regular investors. This is an MIT algorithmic Goldman Sachs market that creates long term negatives. True market is gone and the greedy fukkks will pop this thing again because pigs don’t know how to do anything else but eat until they burst.

  7. phil1247 says:

    TBT

    sold all tbt 41.98

    not buying long bonds yet…..maybe tomorrow

  8. phil1247 says:

    dow

    extension long support OVER 800 points below todays peak

  9. phil1247 says:

    /cl

    50.78 hit!

  10. johnnymagicmoney says:

    Its a sad sad market when volatility is 10 handles on the S&P

    would be much healthier for everyone if we had more sell offs of greater degree but that’s what you get when you don’t have a healthy market.

    Computers have destroyed the market as we knew it and its not a positive

  11. phil1247 says:

    / DX

    if dollar cant break the short at 102 .25 now

    its probably end of the line for old BUCKY

    soon it will be time to …..”” sell into any dollar rally “”

  12. scottycj1 says:

    Wave 2 of 3 finished ?

  13. vivelaamo says:

    Long R2K. Will add more if we fall. This is the pb I was waiting for on volatility. I will be over the by the end of week at the latest.

  14. phil1247 says:

    /gc 1150.5

    target hit

  15. phil1247 says:

    added more SCO

  16. 3 rate hikes.LOL.Last year they predicted 4 for 2016–we had 1.Okay.Anyways,GDP reduced to 2.4 today.Believe these Fed lies if you want.I ‘ll say zero hikes or 1 tops for 2017.As always reality doesn’t matter–just algos.

  17. captbara says:

    So they went for the half measure. Hike 0.25 but 3 times in 2017 instead of 2. Same result as I expected as in USD up. Good work Yellen.

  18. EL MATADOR says:

    Yellen rate rise retaliation in vogue! Better watch yourself Mr Trump.

    • tommyboys says:

      Rate increases here are BULLISH – no retaliation! She MUST follow the global bond market. Reassess at 6%…

      • EL MATADOR says:

        It does not explain why Fed kept delaying rate rises repeatedly for over a year. IMO there is some truth to her retaliating against Mr Trump who has threaten to giving her the boot.

        • tommyboys says:

          nah…

        • Dex T says:

          Yellen only has one more year and Fischer’s term ends in 2018 so it’s questionable what they are going to accomplish.

          Also, there are 2 open seats that Trump can choose his people to

          He isn’t exactly against rate increases though they may conflict with some of his agenda. He’s been pounding the table for Fed oversight and a financial bubble (correctly) since he began running.

          I expect him to nominate people who will bring rates up to 1-2%.

      • Dex T says:

        Not for the real estate market or debt-holders. And that’s if they are minor.

        Still it’s long overdue.

        • EL MATADOR says:

          Also lets not forget that the corporations (global and domestic) have over borrowed $Billions to finance their stock buybacks. If Fed truly follows through with 3 rate rises next year it will hinder corporate balance sheets drastically…. Just saying

  19. phil1247 says:

    SPX

    looking for a spike up to 2282 target
    to unload all remaining spx longs

  20. vivelaamo says:

    Looking at least years rate increase we had a two day pb before Santa rally. Then carnage in January. Could history repeat itself?

  21. gtoptions says:

    Thanks Tony
    Looks like the FED leaked their decision at 10:35. 😉
    SPY ~ Test & Pullback WR’s has been the theme.
    ?? Next WR/WR3 @ 229.15/230.60
    GL All

  22. Well step one,GDX getting above the 20d sma is done–now the difficult but doable part:Still being there at 4pm.

  23. mjtplayer says:

    VIX daily BB width now at 262bps, that’s super tight! Increased volatility ahead….

  24. vivelaamo says:

    Hope everyone is ready to buy the announcement.

  25. I read someone,who is a very sober stock analyst,and he brought up the Electoral College with the question:”Though a complete longshot,what are the odds of electors pulling a coup against an outsider and changing their votes–and what kind of selloff would that create?”THAT would be a crash even PPT couldn’t stop.There are up to 29 electors speaking out and the insidious Clintonites are trying their hardest to cause a “soft coup”–I have no doubts.
    We’ll see how THIS potential black swan swims.(Odds are lottery-like,but possible).

    • fionamargaret says:

      …if you listen to the voices in the underbelly of the market, this is one, and hacking the banking system in Saudi is another…all there…just murmurs..

      • “Harvard University law professor Larry Lessig said Tuesday that 20 Republican Electoral College voters are considering flipping to vote against Donald Trump, more than half the number of anti-Trump votes needed to stall the president-elect from being sworn into office.

        “Obviously, whether an elector ultimately votes his or her conscience will depend in part upon whether there are enough doing the same. We now believe there are more than half the number needed to change the result seriously considering making that vote,” Lessig told Politico.

        Lessig has been offering free legal counsel to “faithless electors” who are considering casting a ballot for an alternative candidate as opposed to Trump, who earned 306 votes on Election Day, well above the necessary 270.

        According to Politico’s report, 20 Republican electors have contacted Lessig’s group about voting against Trump.

        Electors will cast their ballots on Dec. 19.

        If anti-Trump electors manage to whip up enough votes against him, the decision would then go to the GOP-controlled House.”
        —the Hill website.

        • fionamargaret says:

          I haven’t even got a reference point for the Saudi one…each is there in undertones…

        • robslob64 says:

          40 electors would be enough to turn the election in Hillary Clinton’s favor, the so-called “Hamilton Electors” are almost uniformly Democratic voters

          Original 10:
          Christine Pelosi (CA)
          Micheal Baca (CO)
          Anita Bonds (DC)
          Courtney Watson (MD)
          Dudley Dudley (NH)
          Bev Hollingworth (NH)
          Terie Norelli (NH)
          Carol Shea-Porter (NH)
          Clay Pell (RI)
          Chris Suprun (TX)

          Newly Added Electors:
          Edward Buck (CA)
          Donna Ireland (CA)
          Vinz Koller (CA)
          Katherine Lyon (CA)
          John P. MacMurray (CA)
          Andres Ramos (CA)
          Gail Teton-Landis (CA)
          Olivia Reyes-Becerra (CA)
          David Scott Warmuth (CA)
          Gregory H. Willenborg (CA)
          Jerad Sutton (CO)
          Robert Nemenich (CO)
          Nancy Shepherdson (IL)
          Dori Dean (MA)
          Jason Palitsch (MA)
          Parwez Wahid (MA)
          Paul G. Yorkis (MA)
          Robert Leonard (MD)
          Salome T. Peters (MD)
          Melissa Mark-Viverito (NY)
          Stuart Appelbaum (NY)
          Stephanie Miner (NY)
          Melissa Sklarz (NY)
          Andrea Stewart-Cousins (NY)
          Sam H.W. Sappington (OR)
          Beth Caldwell (WA)
          Bret Chiafalo (WA)
          Deb Fitzgerald (VA)
          Terry C. Frye (VA)
          Jeanette Sarver (VA)

          • purplember says:

            if electoral votes puts Hillary in, we’d be closer to civil war.

          • johnnymagicmoney says:

            yeah I saw that list too……………its a joke. So people who are voting for Clinton are going to vote for Clinton? LMAO. And funnier led my Nancy Pelosi’s daughter? LMAO

            sore sore losers

    • CampFreddie says:

      Please … Please … something terrible must surely happen to make Gold go up.

  26. lunker1 says:

    just a WAG….
    2252 was nano 4
    tomorrow micro 4 to the prior 4

  27. Anyone have thoughts on LABU

    • fionamargaret says:

      http://stockcharts.com/freecharts/gallery.html?LABU
      I suggested IBB a couple of days ago….it is still bearish (like LABU), but if it can find its footing here, then it is a good buy, with lots of upside. (look at the pattern chart and note what could be a double bottom). It has had a bear.
      I think Healthcare and Energy have to fill out the market here if we are going substantially higher, and these are the sectors to buy.

  28. stormchaser80llc says:

    No significant changes to yesterday’s thoughts. With new highs on SPX and closing above the top Bollinger Band with little/no negative divergences on the daily chart, things still look bullish. Drilling down to the hourly SPX chart, you can see that the 2270 pivot and yellow bottom of the Sept-Oct triangle extension are once again acting as resistance. Over the past several days this chart has shown negative divergences. It remains to be seen if SPX is consolidating or topping. But the fact that $VIX has not yet made its new low, and a rise in the Technicals Model today suggest to remain long, like all 999 ensemble members have been showing for quite some time now.

    More discussion and charts here: http://navigatethemarketstorm.com

    My site is 100% free. If you are visiting for the first time, be advised that I do ask new users register for a free login to see daily posts. This takes 15 seconds. This is to protect myself, ensuring that everyone agrees to my legal documents.

  29. fionamargaret says:


    Thanks Chris Kimble

    Thanks Tony…..and everyone xx

  30. My buy/sell confirmation point on GDX has been 20d sma.It’s at 21.13 and we closed at 21.03.A jump above tomorrow (and staying there)will keep me in another day.A failure–and I’m gone.Goldfingers crossed.

  31. Tony,

    I was speaking to the local Chinese banks very hard to get capital out of China at the moment even via bitcoin & Hong Kong/China insurance contracts etc. The PBOC are desperate to stop capital outflow, some pretty stringent capital controls are now in place and more coming in early 2017. Your ASX and AUD count is quite bearish. Based on your USD count their could be another 10% upside this could put a lot of pressure for more capital flight and more pressure on other EM countries who borrowed $5 trillion in USD. Thinking once we get to 2300 on the S&P 500 say in late January we could have a little bot of shake out followed by some economic weakness, this give Trump and European leaders the mandate to push the fiscal spend through as it will take until the end of 17 to get the infrastructure spend. Any thoughts on whether this fits your potential counts? I will have to signup up to your tutorials when I get some free time to put my thesis in Objective Elliotwave terms . Thanks

    • tony caldaro says:

      Recently heard China even limited ATM withdrawals in Macau. And that their reserves had dropped to the lowest levels in a year or two. Lots of Chinese made lots of money in just one generation, so this is not surprising.
      Beginning to wonder if the USD has much more upside left. This bull market certainly does not look anything like 1978-1985. It looks more like the one in the late-1990’s. Keeping an eye of the EUR and YEN to give some clues.
      The CB’s would be all better off if they tried to lock in pairs around par. Think a major currency swap program may be in the works after the new administration takes hold.

      • Yes my understanding is the US is happy to have a USD swap program with Europe, Japan, Korea, Australia, New Zealand, but China there has to be something in exchange. Do you see the economist front page featured the strong USD , this might only be a short-term sentiment factor for a turning point in the short-term. I still like you 10% up USD count hurting EM but given the excessive short positions in EUR its getting more marginal. Thanks for your thoughts.

  32. Impressive wave. Anyway to count 2252 as minute 4. If so max minute 5 could be is 2327. Also a wedge in play, the top by end of December would be 2300 approx , which is fast approaching. If not minute 3 should end at 2320 then a 40 point pull back to 2280 then if 1 equals 5 then 2378. But wave 5s are week.
    So my 2 cents is higher still yet. Key number to watch to see what happens is 2300 and how fast we get there. Did not realy see this, I was wrong, nicely done tony. I’m supposed to be on vacation, but I can’t help myself.

  33. bouraq says:

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

  34. blackjak100 says:

    TC, your implied bull market target is S&P 3500-4000. Unemployment is at 4.6% with S&P at 2278. Where do you think all the workers are going to come from to propel it that high?

    • tony caldaro says:

      You must have me mistaken with someone else
      Have never implied that range

    • There are plenty of bodies as the labor force participation rate is around 63%, leaving 95 million idle. But I also understand demographic shifts. I think the challenge will be in (1) reducing incentives to stay at home enjoying an entitlement lifestyle and (2) in worker training because I just read there are 5 million openings that cannot be filled owing to insufficient skill sets. In regard to the second point, we need to think more like Germany.

    • CB says:

      Blackjack, Amazon will prolly use more drones =) …they all love automation ..

      • yip robots and software only need workers for construction

        • CB says:

          Great point. And it just happens to be one area that’s been getting fiercely competitive in the last 10-15 yrs and where we’ve seen lots of outsourcing.
          Btw, if Trump really wants to address some of those job concerns that helped get him elected, perhaps he and his team can take a good look at some of those elite tech schools in India and figure out how we, too, can produce top talent like that. Because if we don’t build those robots ourselves , the Chinese will eventually build them for us.. and that would be a dangerous scenario.
          Let’s hope that the new team does something constructive in that area, instead of simply trying to create artificial barriers to trade, migration etc….The whole world is getting more competitive and we just cannot isolate ourselves by building walls…so let’s hope Trump can actually embrace competition…

          • Exactly the right forms of education & investment are the golden key to productivity growth. Economists seem to behave like we are still in a world of manufacturing when most western economies are 70% services. The problem is a lot of the new service jobs a low paid relatively low skill. What we seeing is companies like Amazon, Facebook, Uber are all software/robot intensive businesses that are trying to create monopolies (look at their high gross margins) via capturing a great percentage of labour’s share of GDP. At some point these global corporates will need to be taxed and so that the profit/labour share imbalance is addressed.

  35. captbara says:

    Dax officially made it back in the up channel of 2009-2015. Congrats Dax! 🙋

  36. EL MATADOR says:

    Trump won POTUS! Yellen ready to raise rates “in retaliation” starting manana.
    Also 2286 Pivot-pong hit coming manana.

    Thanks Tony.

  37. llerias7 says:

    Thks TC.
    Large Cap outperforming Small ones today from a wide margin?!…Someone triyng to “homogeneize” the mkt?

    • CB says:

      asymmetric response to higher corporate funding costs, most likely…risk-based pricing ..nothing unusual…

    • fionamargaret says:

      If there are worries for the banking system, political system, whatever,, there is nothing deemed safer and more liquid than the Dow 30.

  38. 123 abc says:

    If the following speculative count is correct, then guessing the Trump rally may have finally completed. Second attempt short at the close with a stop at today’s high.


    • Never short a third wave abc, its crazy

      • 123 abc says:

        Indeed third waves are relentless!
        However, personally feel that the rally from the November low to the present high is all of wave-1, and now expecting a pullback for wave-2.
        Currently short at 2272 with a stop at 2277.5 —so just a low-risk gamble.
        Mentioned on the Weekend Update that 2276 could be a top, and interestingly today’s high came within that range: ttps://caldaro.wordpress.com/2016/12/10/weekend-update-582/comment-page-1/#comment-296405

        • 123 abc says:

          P.S. Perhaps the Supermoon tomorrow ends this Trump rally?! 😉

        • lunker1 says:

          What’s your count? Third waves can’t be the shortest and the most obvious visual count violates that.

          • 123 abc says:

            Speculating that the Trump rally from the November low to today’s high is one wave consisting of the following…

            Wave1 (62.3 points): 2084.6 to 2146.9 (2144.7 orthodox)
            Wave2 (21.5 points): 2146.9 to 2125.4
            Wave3 (88.7 points): 2125.4 to 2214.1
            Wave4 (26.7 points): 2214.1 to 2187.4
            Wave5 (90.1 points): 2187.4 to 2277.5 (thus far)

            @2276: Wave1 * 2.382
            @2276: Wave3 = Wave5
            @2275: Wave5 = Wave1 * 1.382

  39. phil1247 says:

    tony

    now that we have gone thru the monthly extension long target at 2268 spx
    which is very close to your 2270 pivot
    the next monthly extension long target is at 2444

    do you have a pivot there perhaps?

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