Thursday update

SHORT TERM: higher open then pullback, DOW -16

Overnight the Asian markets gained 1.0%: mostly Hong Kong. Europe opened higher and gained 0.2%. US index futures were higher overnight as well. At 8:30 weekly jobless claims were reported lower: 241K v 243K, housing starts were reported higher: 1288K v 1246K, building permits were reported lower: 1213K v 1285K, and the Philly FED was lower: 32.8 v 43.3. The market opened at SPX 2388, 3 points above yesterday’s close, and immediately began to pullback. At 11:30 the SPX hit 2378, bounced to 2383 by 2pm, pulled back to 2377 by 3pm, then ended the day at 2381.

For the day the SPX/DOW lost 0.10%, and the NDX/NAZ ended mixed. Bonds dropped 8 ticks, Crude was flat, Gold rose $5, and the USD was lower. Medium term support remains at the 2336 and 2321 pivots, with resistance at the 2385 and 2411 pivots. Tomorrow: industrial production at 9:15, then leading indicators and consumer sentiment at 10am.

The market opened a bit higher today, hit SPX 2388, pulled back to 2378 by late morning, rebounded some, and then pulled back to 2377 at 3pm, before ending the day at 2381. At today’s low the market had pulled back 13 points from yesterday’s high. A meaningful for day traders, but not so much for this wave counter. With most of the economic news for the week now out of the way. The last determining factor for this week, is whether or not option expiration’s impact occurred today, or will occur tomorrow. With today’s pullback, after yesterday’s rally, it could have already occurred. Short term support is at SPX 2353/55/58 and the 2336 pivot, with resistance at the 2385 pivot and SPX 2401. Short term momentum declined to neutral during today’s pullback. Trade what is 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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123 Responses to Thursday update

  1. NEWBIE says:

    Bearish close, bulls are in big trouble. Something is brewing.

  2. phil1247 says:

    Fotis

    are u watching SPX getting sucked down to 2379.71 ????

    raising stops on SPXU and ready to take profits

  3. rabbittrader1 says:

    We are in the beginning of a primary wave lll, the longest and strongest of the elliot wave patterns. Day traders beware, bears beware. As Tony has said we are targeting 3000 SPX for only the top of cycle wave One, of five cycle waves, to complete Primary III. People like Newbie and other bears obviously are out of tune with the FACTS. GET long or just stand aside while the BULLS make $$$MONEY. Rabbit

  4. vivelaamo says:

    As soon a RUT is above 1391 continue buying the dips. Never listen to the like of Newbie. They will poison your mind. If a person uses stops and money management then it doesn’t matter if we crash.

  5. phil1247 says:

    bonds did their part …rallied nicely to noontime… taking bond profits now

    stocks were cooperating but never made it to 2374 by noon..got to 2377+

    like yogi said ..
    .” its tough to make predictions
    …especially about the future”
    and even tougher when its a parlay

    see you next week

  6. phil1247 says:

    Fotis

    SPX close 2379.71

  7. captbara says:

    Kind of a weak 3/C wave today. Maybe gap down Mon then TT?

  8. Hugh Jazole says:

    What’s happening is so unbelievable to people, that no one can accept it. We’ve become so accustomed to extreme volatility, that when the bull stars are finally aligned, we refuse to see it.

    • NEWBIE says:

      Hugh, you say we have bee accustomed to EXTREME VOLATILITY. Where have you been? volatility has been non existent or a non factor for quite some time.

      • tommyboys says:

        Newb, I think he’s referencing longer term secular type volatility. Anyone that was of “market age” and lived through 2000 & 2008 are still reeling and chronically expectant a huge downdraft almost daily. I can’t even get comfortable with a 300pt Dow rally fearing it’ll tank 700 pts the next day…

        • tommyboys says:

          Was never like this prior to 2000 internet bubble implosion. I was comfortable every day and felt very confident daily of having a larger balances at day’s end than day’s beginning. Now I fear each day.

        • Hugh Jazole says:

          That’s exactly what I’m referring to. I was lucky enough to avoid that bear market, because I had become hyper vigilant. I knew the market was in trouble, between the falling dollar, and resultant rapid rise in oil price, the completely insane housing market etc. Even though I have become much less paranoid, I’m still quite cautious. After rubbing my eyes over and over the last few months, I can’t help but come to the conclusion that the market looks incredibly like 95/96. All the way down to the CAPE ratio. Being complacent was exactly what you wanted to be then.

      • chrisk44342 says:

        That’s true. With vol so low, that should be clue #1 for the past 5 years not to be short. Imagine the opportunity you’ve cost yourself over that time. Can you fire yourself as a manager of your own money? Yes, you can!

  9. Hugh Jazole says:

    Investing.com trader sentiment for the major indices is between 60-70% bearish. Everyone is screaming TOP, because of put/call ratios, Fear/Greed index creeping into fear territory, all of this and not a single real catalyst for a major selloff. This market is about to make an even bigger fool of the bears than it already has.

  10. Hugh Jazole says:

    Any opinions on TGT? Oversold?

  11. phil1247 says:

    http://tos.mx/lk10Vu?image

    running out of time for 2374 by noon

  12. If GdX gets above 23.55 (34d),past moves show a quick acceleration to the upside.Would still think clearing 24 is the next positive level to clear,then 25.60.Keeping in mind the monthly chart seems bearish.Dollar breaking would be the catalyst of course to keep miners moving,a bullish cross of 13 and 34 mas would open some algo eyeballs.A lot to watch today.

  13. phil1247 says:

    SPX

    is trading at 2374 at 1130 am

  14. Well the dollar has dropped below the 20d,following the first rate hike pattern of selling off(late 2015) closer than the last one in December(which barely broke the 20d)This H&S has real potential.Trader Moe’s gold chart said there were two ways to go and so far,holding 1200 is the bullish scenario.Some economic data at 9:15 and 10 today.See if that can start some currency movement.Good luck all.

  15. For Newbie:
    Indeed, John Hussman goes as far as to say that “this is the most dangerous and overvalued stock market on record — worse than 2007, worse than 2000, even worse than 1929” as reported by Marketwatch.

    For some months now, Hussman of Hussman Funds’ has been warning in his research that investors are ignoring extremely high stock market valuations and are being lulled into a false sense of security by central bank liquidity, massive quantitative easing and zero percent and negative interest rates.

    Hussman begins his latest research note by quoting the late, great Sir John Templeton:

    “Bull markets are born on pessimism, grow on scepticism, mature on optimism, and die on euphoria.”

    He then warns

    “A week ago, BULLISH SENTIMENT among investment advisers soared to the HIGHEST level in 30 years (Investor’s Intelligence), joined last week by a 16-year high in consumer confidence. When one recognises that the PRIOR PEAK in bullish sentiment corresponds to the 1987 market extreme, and the prior peak in consumer confidence corresponds to the 2000 bubble, Sir Templeton’s words take on both relevance and urgency.”

    Hussman advises investors become more defensive, because the market could be about to enter a brutal bear market as seen throughout history.
    Pleasant dreams all.

  16. mjtplayer says:

    B Seagle – this chart is for you.

    DXY, weekly candles. Massive bull flag, breakout to the upside, successful pullback to backtest the top of the channel. Currently in a 1,2 higher or perhaps A, B and now C down to test the 99 area. Either way, it will be difficult for the Dollar Index to break below the 99 area IMO, I just don’t see 97.

    Le Pen winning the French election in late April could be the catalyst to get the Dollar rocking to the upside again. Above 104 and the next target is roughly 106 and maybe 110 if the Euro breaks parity and falls into the mid-high 0.90’s.

    https://www.tradingview.com/x/R8UOy0gQ/

    • magnus1234 says:

      My two cents. Le Pen might win the first round in April but she will never ever win the second. French elections are held in two rounds. So USD might get a boost but it will be short lived when “real” investors control the market again (that is after hot-money have runned their cause)

      • vivelaamo says:

        Good point. Right wing make a lot of noise but when it comes to the crunch they never win. Holland and Austria good examples. Merkel will continue in Germany.

        • mjtplayer says:

          Merkel will lose re-election, bet on it

          • magnus1234 says:

            Well, Merkel may lose but in that case to SPD (Social democrates)…The right wing AfD will not have a slightest chance to become the ruling party. Don’t forget that Europe is not a two-party system. The other parties will block AfD.

    • NEWBIE says:

      From Trumps Mouth to your ears 4:08 – 4:48 in this video. “Were in a bubble right now, the only thing that looks good is the stock market. If you raise interest rates even a little bit that gonna come crashing down. We are in big fat ugly bubble and we better be careful” etc….

      • fionamargaret says:

        …”minding your tongue” was something we probably heard in childhood, but it does offer better outcomes….

      • pooch77 says:

        campaign ploy that’s all

      • vivelaamo says:

        For the sake of millions of hard working people out there that have invested a lot of savings in stocks. I hope you are wrong.

        What disturbs me the most is how much you want it to happen!

        • STEPHEN BARTLETT says:

          Do me a favour! Nobody bar the 1% have got rich from the stock market.

          • vivelaamo says:

            Who said anything about getting rich? A lot of people invest in the stock market, especially when interest rates have been so low for years. It’s not the rich that would get hurt if the stock market crashed. If anything they are the ones that will prosper from the recovery.

        • NEWBIE says:

          Vive, don’t shoot the messenger.

          • scorp100 says:

            So, you don’t want market to crash? That’s unbelievable given your history.
            Anyway, didn’t Trump mention in a speech last month that stock market has gone up since his election?

            • NEWBIE says:

              The system needs to reset itself. The sooner it resets, the sooner we can regroup. I personally do not want to see people suffer, however, it is inevitable. The writing is on the wall- tuff times ahead.

        • Page says:

          vive.. agree, just ignore the noise

  17. cj32 says:

    Cr. to CBZ

  18. fionamargaret says:


    Thanks Chris Kimble

    Thanks Tony…..and everyone. xx

    • blackjak100 says:

      Since I’m in a criticizing mood, Kimble calling that an IHS is ludracris. Since when is a LS part of the head???? Unfortunately, I don’t see a LS at all.

      • fionamargaret says:

        No Raymond James tonight BJ (nice charts yesterday), and I have to offer something….
        Narek Hakhnazaryan (Tchaikovsky gold medal winner, and in my mind absolutely fabulous) plays Paganini, and if that isn’t enough, Martha Argerich plays the Jazziest of all piano concertos (with shades of Gershwin thrown in). Both will make you smile.

      • Jack Sparrow says:

        so far futures making perfect 1st wave of 5th… no overlap …alteration 🙂 although night is still young anything can happen

      • pintopower says:

        I agree he probably mislabeled the LS. But I do see a LS that is not labeled at all – near where the neckline starts at the beginning of 2014. But doesn’t mean IHS will work out. Just my opinion.

      • Richard Glackin says:

        Agree, no inverse H&S. However, there is a H&S -not inverse…look at the peak indicated as right shoulder – that’s H&S. Now, H&S patterns aren’t the most reliable. Oftentimes the just don’t play out. BUT, when they do they are usually fairly accurate. This one says $10 silver. Guess we’ll have to wait and see.

  19. My 2 cents 2377 held thus far. Off to 2409ish to end a 3 of some sort. Below 2377 down to 2370 and see what happens from there

  20. I am seeing a forming ascending triangle which often is frustrating for bulls and bears but the pattern is bullish.

    • Bud Fox says:

      Agree, pattern is still Bullish, with the 5th wave potential underway….
      The R2 level, does look to be ideal, place for a price top = 2435.
      Good work, thanks….

  21. opader says:

    SGS ticked higher today. At this point, my plan is to open my first long position of three in SPY if SGS closes above its DTL (13 D-EMA). I’m hoping to see RUT start performing at least at par with other major indices.

  22. Thanks Tony. Its not unusual for the market to retreat to levels near the point of lift off following a Fed inspired rally though, base upon memory, typically not the following day. The recent high of 2390 would be of interest were it clear we were in a declining market but I don’t it’s clear that’s the case. With this in mind, the market going forward will make its big decisions off of pivots and/or daily levels, not hourly. Having cleared 2380, in my mind the likely next big test will be in the 95/96 area with the 95.50 gap of particular interest. All know the pivots and prices to watch above these levels. Thanks again Tony.

  23. bouraq says:

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

  24. mjtplayer says:

    The reversals in oil, gold and bonds today weren’t pretty, if the counter-trend bounces are going to continue than tomorrow is a potentially important day. Very poor lack of follow-through for all of these assets, time to short gold again – from what I see.

    If the GLD gaps down by $0.40 or $0.50 tomorrow at the open ($4 – $5 in gold) then we have a potential “abandoned baby” top in the gold rally – very bearish. I thought the gold rally would last longer than a couple days, maybe it will, but today was not a good day for gold – or oil for that matter.

    • B Seagle says:

      $usd is forming a right shoulder–target 97…this should drive the price of gold up…

      • Would be nice to see one of these break to the downside.Believe it when I see it.Plus,there’s no proof the miners want to participate.Goldfingers crossed though.

      • mjtplayer says:

        I see the USD pattern, potentially. Problem is the French election on April 23rd and if Le Pen wins than the Euro is toast. We’ll see, the Euro has already had a nice 2 month rally and it will be tough getting through the 1.09 – 1.10 area (currently 1.077), so maybe another 1% – 2% higher in the Euro; maybe….

        • The analysis over here on the Dutch election was that Europe is full of anti-Trump sentiment and LePen doesn’t have a chance.Of course the “analysis” was on liberal TV.I don’t know why I had it on…lol.

  25. gtoptions says:

    Thanks Tony
    Friday OPEX & SPY ex-div ~ Continued consolidation IMO

  26. blackjak100 says:

    I think iv clearly ended 2355 and not 2358. A truncation appears to be too large and there wasn’t strong enough upwards movement to validate it. If this is correct, an ABC just formed from 2355 which suggests ED wave v

    • blackjak100 says:

      No matter how you slice it, the path of least resistance for tomorrow appears to be down.

      • pooch77 says:

        why?

      • vivelaamo says:

        Yes please explain?

        • blackjak100 says:

          More short term wave counts look incomplete to downside. Clearly a 3 wave move to 78.6% retracement which makes an ED less probable because 2401 was not exceeded with wave A. A 1-2-i-ii very unlikely. Is wave iv continuing as a triangle?

          I’m wrong with a HH above 2390.

          • 123 abc says:

            Nano-v → Pico-3 underway imminently…?

            • blackjak100 says:

              possible, but very unlikely. You have nano iv as a large truncation for a 46 pt drop. Price did not move sideways so a double three (where you could see it end above the low) is out of the mix. Then, your pico 2 is truncated. Again, I speak in probabilities. The probability of having 2 truncations is slim to none. Even if you’re nano iv placement is correct, pico 2 most likely has to move lower first. My money for the reasons I’ve stated above says the gap gets filled near 2364ish which suggests nano iv is continuing as a triangle. Doesn’t mean we can’t open 2-3pts higher first tomorrow, but be prepared for an immediate drop from there if it happens.

              • Jack Sparrow says:

                the only pther point is if you count where its say A in the above chart as 1 and see where the 4 stopped today ..just a fraction above 1 (or A in the above shart)..
                so another count change A to 1 then the last high of yesterday as 3 and today was 4… and this with originial correction ending at 2355.

            • Mary773 says:

              That is certainly a viable short term count, 123 abc, and it is compatible with Tony’s scenario. Thank you.

            • blackjak100 says:

              again I speak in probabilities. That count is unlikely because both wave 2 & wave 4 moved downwards reducing the probability. Neither was a sideways correction which you normally see in a true impulse. I said I would be wrong with a HH above 2390. The futes should move considerably higher if your count or 1-2-i-ii is playing out. My bet playing the probabilities says it’s unlikely.

              • chrisk44342 says:

                Yes i agree that a truncation of iv is unlikely in EW terms. More likely we made a bottom at the lower low and pico 2 was a very deep, but perfectly allowable, retracement. This is why i don’t like short term EW mapping- it really isn’t as useful as using conventional indicators or price action. We’ll only know after the fact which count was correct.

              • chrisk44342 says:

                I do appreciate the charts 123- keep them coming

      • tommyboys says:

        Think the oppsite. Today was a perfect consolidation of Wednesday’s big gains. Gap & go mañana…

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