Tuesday update

SHORT TERM: lower open on pullback Tuesday, DOW -59

Overnight the Asian markets lost 0.4%. Europe opened lower and lost 0.7%. US index futures were lower yesterday, and overnight, and at 8:30 the NY FED was reported lower: 6.5 v 9.0. The market opened 7 points below Friday’s SPX 2275 close, ticked down to 2265 by 10am, then tried to rally. After hitting SPX 2272 by 10:30 the market went into a 4 point trading range, and hit 2272 again by 1:30. After that it headed even lower. Around 3pm the SPX hit 2263, then bounced to close at 2268.

For the day the SPX/DOW lost 0.30%, and the NDX/NAZ lost 0.45%. Bonds gained 16 ticks, Crude added 15 cents, Gold rallied $17, and the USD was lower. Medium term support drops again to the 2212 and 2177 pivots, with resistance at the 2270 and 2286 pivots. Tomorrow: the CPI at 8:30, industrial production (est. 0.7%) at 9:15, the NAHB at 10am, the FED’s beige book at 2pm, then a speech from FED chair Yellen at 3pm. Full day!

The market opened lower to start the holiday shortened options expiration week. After hitting SPX 2265, it bounced to 2272, then hit 2263 just before a 2269 close. Last week’s entire trading range, SPX 2254-2279, which occurred within 24 hours, has already been retraced 61.8% at today’s low. Market movement continues to look like choppy corrective activity. Short term support drops back to SPX 2254 and SPX 2245, with resistance at the 2270 and 2286 pivots. Short term momentum ended the day with a slight positive divergence. Trade what’s in front of you!

MEDIUM TERM: uptrend

LONG TERM: uptrend

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

About tony caldaro

Investor
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74 Responses to Tuesday update

  1. cj32 says:

    Cr. CBZ

  2. Yellen put a hit out on gold (as usual).Speech just given.DXY up hat it lost yesterday.Dollar never stays under the 50d too long does it?

  3. captbara says:

    Switch back to long DXJ & USDJPY from long SPX. Abe time again

  4. phil1247 says:

    gold

    1185 must support or its over

  5. Since Friday’s close, VIX has gone up 11%, while UVXY has actually gone DOWN by 3%. How is that even possible? UVXY “should” be up by 22%, but even though it never achieves 2:1, it should still be at least up 10%. What gives, ProShares?!?

    • kvilia says:

      You don’t understand how UVXY works. It is near term volatility futures. Although VIX rose 11%, markets do not believe in sustainable correction, so UVXY premiums don’t go up. Watch SPX triangle formation breaking tomorrow or even before the close to see UVXY reaction.

    • kingfrogcash says:

      because the future months are down, cash up

  6. phil1247 says:

    gold

    took small profits at 1212 /gc

    if 1208 fails
    support drops to 1199

  7. i think if we don’t get thru resistance soon, people are going to head for the exits soon and not wait for the inauguration.

  8. vivelaamo says:

    I think we will get a 5% drop in US indices and I also thank that would be very healthy/bullish for the market and a great opportunity to buy.

  9. mcgcapital says:

    Just feels like rotation at the moment, when one thing goes up something else goes down. Can’t understand why anyone would be a buyer here without a pullback first given we’re clearly defining some resistance levels and there are signs of deterioration

  10. Jack Sparrow says:

    what if we already hit the high for next 2/3 years a couple of weeks ago…remember its not easy to call the top otherwise everyone would be doing it…top normally sneaks in when no one expects it…i havent seen anyone call the high of few days back as a top…we can count 5 overlapping waves from 1800 in SP

  11. captbara says:

    SPX is stalling but I see USD and UJ in a falling wedge of sorts. Should be bullish for all when it breaks out.

    • johnnymagicmoney says:

      so when dollar goes up its bullish and when dollar goes down its bullish too? I get it – delusion

    • blackjak100 says:

      My bet is there’s a huge one day sell off to complete correction similar to the one back in early sept. I realize the one in sept only completed ‘a’ wave. This one should complete a ‘c’ wave.

  12. kvilia says:

    Confusion around Phil’s statements –
    Phil trades on 15 mins charts, once meaningful support or resistance is taken out on micro, he changes positions. If someone is (learned :)) trading based on daily chart, you will never understand each other.
    Re gold. I am also looking to assess the validity of this bounce. So at some point, gold will take back some of it’s advancement. Let’s see how it plays out, then we will understand new support levels.

  13. EL MATADOR says:

    Now let’s be fair guys, there is no denying that the market’s did experience both Br-exit and Trump election win sell-off. International cash markets and US future markets did sell-off of heavily on the Trump election win but the sell-off lasted less then 18 hours. Nonetheless it as a sell-off and many got hurt, except the smart dudes 😉

  14. Any thoughts on IRon Ore and Vale?

    • fionamargaret says:

      There is a conundrum with iron ore which is discussed frequently in Europe.
      Iron ore keeps rising, at the same time supply is plentiful…
      Vale is a breakout stock….you are thinking correctly….commodities are getting off the mat.
      DBB, DBC, DBA, DBP.
      NG is under great demand in Europe…can’t get enough, to deal with the cold spell.
      Scotty’s ice-age I think x
      I am long UGAZ …there is one of Trump’s picks who wants to use NG in transportation, but the number suggested for UGAZ is in the 40’s…about 13 higher.
      And yes, buying momentum and selling continuum for UVXY is sound, but it really has nothing to do with the pattern the price makes and where it is going…I shall suggest UVXY is a buy at 21. Please check your own methods….that is just what I think (and what I would suggest to any fund). I am also long UCO.

  15. captbara says:

    Waiting for inauguration to make a big move I guess?

    • I think that if the inauguration goes off without the 4th turn getting started,it will be a relief for equities.Lots of protests that could get out of hand–if you believe some of stuff being tossed around.Everyone says big selloff post inauguration–last time I heard the same message was,”If Trump wins,stocks will fall.”We’ll see.

  16. gtoptions says:

    Thanks Tony
    FYI ~ SPX ~ Fib 5 Time Cycle hits today.

    https://www.tradingview.com/x/m2pIMQVf/

  17. vivelaamo says:

    Rut at 1352 yet again! Surely it’s time to give way for another 30 point plunge from here.

  18. gary61b says:

    SPX, maybe a gap fill then a plunge.

  19. cj32 says:

    Cr. CBZ

  20. Couple things I saw today.Peter Kieman,ex-exec at GS,now an analyst on FOXbiz,says he thinks a Trump/Yellen battle is brewing over the dollar and interest rate increases.”Trump would win that battle”,said Kieman,therefore the dollar drops.I could see a meeting,like the one Obama had with JY last February,where Trump explains what he wants out of the Fed.
    Second thing is the sudden explosion of short term bullishness for gold.Only one analyst (Jordan Roy Byrne)agrees with me on GDX probably finding a top at 25.A month ago he was calling for much lower prices,although he thought a small bounce could happen.
    Avi getting real bullish on a break over 24–thinks a quick move to 28-31 follows that event.GDX overlapped,which brings a potential extra bullish count.
    Me,I’m sticking to (hopefully)DXY dropping below 100 to possibly 97-98,after which dollar rerallies and PMs break back down.How much they fall will hopefully indicate if that is all we get for the year.Open to be more bullish,but to me,this rally is a short term rally from the weekly +div in December.
    And everyone is looking for a post inauguration selloff in equities.I mean everyone.Good luck all.

  21. stormchaser80 says:

    Market breadth and internals continue to suggest weakness ahead for the SPX, as does weakness in my proprietary Technicals Model. $VIX has entered a new uptrend, supported by strong positive divergences mentioned last week. HYG:IEF is particularly weak and should be a read flag for bulls.

    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.

  22. purplember says:

    OIL – opec to cut production (we’ll see if it actually happens) to increase prices. However, US shale increases output. I doubt if opec countries will accept lower production at lower prices than they planned. they’ll likely say “heck with it” and increase production as well.

    http://www.marketwatch.com/story/rising-us-shale-oil-output-threatens-opecs-production-pact-2017-01-17

  23. The banking sector was hit hard today.

  24. scottycj1 says:

    The market is lulling you to sleep…..your getting very sleepy………..

  25. torehund says:

    Humid and choppy, needs heavy rain to clean the air 🙂

  26. Thanks Tony. I noticed what you did with respect to trading ranges. This is very vexing market and I an running out of lines trying to describe its behavior.

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