Tuesday update

SHORT TERM: new highs start week, DOW +119

Over the extended weekend Asian markets gained 0.2%. Europe opened higher today and gained 0.5%. US index futures were higher into this morning. The market opened 6 points above Friday’s SPX 2351 close, and continued to rally. Just past 10:30 the SPX hit 2366 and then began to pullback. By 11:30 the SPX hit 2358, and began to rally. Heading into the close the SPX hit 2367, then dipped to close at 2365.

For the day the SPX/DOW gained 0.60%, and the NDX/NAZ gained 0.50%. Bonds slipped 1 tick, Crude rose 60 cents, Gold added $1, and the USD was higher. Medium term support remains at the 2336 and 2321 pivots, with resistance at the 2385 and 2411 pivots. Tomorrow: existing home sales at 10am, then the FOMC minutes at 2pm.

The market opened at a new high today, rallied to SPX 2366 in the morning, pulled back 8 points, then hit 2367 in the afternoon. Quite a solid rally for all of the month of February. Only one short term oversold condition, and not one 20-point pullback. Friday’s short term negative divergence never developed as the market opened higher. The market did make another negative divergence at the SPX 2366 high, but the market only pulled back 8 points. Next stop the OEW 2385 pivot range, before a 20-point pullback? Over the weekend, a member of our group noted there has been near end of month weakness during the entire uptrend. February ends next Tuesday. Short term support remains at the 2336 and 2321 pivots, with resistance at the 2385 and 2411 pivots. Short term momentum continues to display negative divergences. 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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74 Responses to Tuesday update

  1. FED highlights from ZH
    However in a surprising twist, some Fed members explicitly warned that the market has gotten ahead of itself and that Trump’s fiscal policies may never materialize…

    “A few participants commented that the recent increase in equity prices might in part reflect investors’ anticipation of a boost to earnings from a cut in corporate taxes or more expansionary fiscal policy, which might not materialize.”

    And in another warning, the same Fed members warned that the VIX is too low

    They also expressed concern “that the low level of implied volatility in equity markets appeared inconsistent with the considerable uncertainty attending the outlook for such policy initiatives.”
    LML25:They seemed to talk against the dollar,but inferred rate hikes sooner.I think until Trump policies get passed by Congress,no rate hikes–just talk of them.
    Tomorrow will be a huge day for GDX.If no gap down,I’ll probably buy.Good luck all.

  2. vivelaamo says:

    Buy on dip. Sell on rally. Rinse and repeat. Money for everyone.

    All the best xx

  3. Key Avi support less than one percent away at 23.75 on GDX.This should be interesting.Already broke the 20d.My bet is lower,but hope it holds for further upside.The dollar has a H&S forming on the right shoulder(still),which probably shouldn’t go over 102–or its negated.A dive now after Fed minutes is probably mandatory.I wouldn’t bet on that either–would love to be surprised.
    Last thing.P&F has GDXJ going to 70 from current 42ish.GDX still at 7.Individual stocks raised up to 40% higher POs.But GDX must hold as part of the equation,imho or none of that will happen.Good luck all.

    • I’m going to add,if GDX–after breaking the 20d–does NOT drop precipitously today or tomorrow,and in fact breaks up,would be bullish.Previous 20d breaks have been quick and painful drops within 2 days.There’s no doubt about the direction after it happens.We’ll see how this reacts.

  4. gtoptions says:

    Thanks Tony
    SPY ~ Fails @ WR1 @ 235.29 then WPP Test?
    SPX ~ Stalling @ M/Y Pivot
    https://www.tradingview.com/x/vXlOqscE/
    GL All

    • fionamargaret says:

      I have a discrepancy between the 3 averages.
      About 2000 points.of upside left in the DJIA, where the other 2 averages are at the top of their patterns.
      UVXY is a buy, UDOW is a buy, SCO, DGAZ are buys if you think oil is going down.

      • gtoptions says:

        SPX working off the overbought, then continue uptrend.

      • fionamargaret says:

        I switched to UGAZ from DGAZ, as there should be a bounce here…..maybe I am clutching at straws….x

      • fionamargaret says:

        I should just let things be….Bloomberg picked up on this, and showed a chart with almost 100% DJIA stocks now at 52 wk.highs.
        It will work itself out when we have a correction or the next wave up….or the pattern changes.
        I still think a pullback in sync with my UVXY….

  5. Bud Fox says:

    SP500 — not looking very healthy right now. Expecting a rather strong correction
    Near term….watching for Mr T to comment tonight….

  6. vivelaamo says:

    This site messes with my head sometimes. Why is everyone so desperate to predict a top? If you’re a day trader surely you should Keep buying the dip every day until it no longer works?

  7. phil1247 says:

    /ES

    aggressive extensions failing but traditionals holding

    next target /es 2369

    prob 5th wave ……ie SHORT leash on longs now

  8. vivelaamo says:

    Flat today then rally tomorrow. IMO of course.

  9. Indian says:

    Quick spike down to 2300 over the next few weeks, after that my guess is we trend down. 2366 will be viewed as a significant top. Personally I’m not expecting a “topping process” or “rounded top” instead it should be more of a commodity type “the move is done lookout below type pattern”.

    http://stockcharts.com/h-sc/ui?s=%24SPX&p=120&yr=0&mn=2&dy=10&id=p94062971107&a=482740743&r=1487771539182&cmd=print

  10. phil1247 says:

    DOLLAR

    rip your face off rally moment of truth is here

  11. phil1247 says:

    CRUDE

    unless there is a miracle stick save today

    /CLJ6 is in serious trouble

  12. torehund says:

    https://www.investing.com/currencies/usd-sek

    Could very well be a shorting opportunity of a lifetime if the following count is correct.

    W-1 from April 2011 until May 2012. W-2 from Feb 2014 until 01 Nov 2014. Thereafter an ascending ABC until 01 Nov 2016. Thereafter a lower order abc decline into 31 Jan 2017.
    Well, the magnitude of the third wave will be monstrous.

  13. I had to laugh,and this seemed like something JMM would write in exasperation,but on zerohedge someone asked,”What could go wrong with this market?”
    Someone else responded,War,Trump assassination ,meteor or alien invasion.To which the next response was:
    War= bullish defense sector and any company who waves a flag

    Assassination = a Trump Blvd in every town and a sympathetic passage of all his ideas in Congress. In short, Bullish.

    Meteor Impact = reconstruction paid for by Govt stimulus. Bullish! CAT stock goes to moon.

    Alien Invasion = new investors come to the table to replace old ones. BULLISH! Plus I can’t wait for my alien blaster pistol.
    Maybe it WAS johnnymagicmoney…lol.

  14. Mr C,does this market remind you of any previous period of time?I’m going to say 1999.Or is this its own particular animal?I’ve actually heard comparisons to 1986,pre-Reagan tax cuts,with a big selloff in oil.Thanks.

  15. stormchaser80llc says:

    Still long 401k and May SPY calls (Up greater than 50%!). My LONG signal remains ‘YES’.

    My proprietary Technicals Model improved today, just shy of its high last Wednesday. This suggests more room to the upside as readings are currently in very bullish territory. Thus, I continue to believe that higher highs are coming for SPX.

    The hourly chart had negative divergence’s at today’s highs. I believe a downtrend will carry through overnight, perhaps affecting tomorrow’s session. VIX is in a bounce of a downtrend. Breadth is relatively strong right now as well.

    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.

  16. Jack Sparrow says:

    the futures graph below–just hit the above channel today….any significance?http://imgur.com/a/FdsUv

  17. Jack Sparrow says:

    The trump speech next week will put brakes to this rally…

  18. EL MATADOR says:

    Thanks Tony, Bill Joey says, “Getting Closer”

  19. bouraq says:

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

    • torehund says:

      When the progressive higher order 3s get stacked up on each-other, counting will be difficult.
      Just need that elusive pico II bottom, and its game on for the lowest order wave 3 to commence. From there on I think Abcs will tilt upwards and the elevator will have few meaningful stops. Thanks for the counting, makes me dizzy in a good way.

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