Wednesday update

SHORT TERM: consolidation day, DOW -7

Overnight the Asian markets lost 1.4%. Europe opened lower and lost 0.5%. US index futures were relative flat overnight, and at 9am the FHFA was reported unchanged. The market opened 4 points below yesterday’s SPX 2344 close, bounced to 2345 in the opening minutes, then declined to 2336 by 10:30. At 10am existing home sales were reported lower: 5.48M v 5.69M. Then the market rallied to SPX 2351 by 11:30, pulled back to 2341 by 1pm, rallied to 2352 by 3:30, then closed at 2348.

For the day the SPX/DOW were mixed, and the NDX/NAZ gained 0.55%. Bonds rose 7 ticks, Crude slipped 10 cents, Gold gained $3, and the USD was lower. Medium term support remains at the 2336 and 2321 pivots, with resistance at the 2385 and 2411 pivots. Tomorrow: weekly jobless claims at 8:30, a speech from FED chair Yellen at 8:45, then new home sales at 10am.

The market opened lower today, bounced, then hit the OEW 2336 pivot. After that it rallied 15 points, for its best advance since this decline from SPX 2390 began a week ago. The total decline from the March 1st all-time high at SPX 2401 has now reached 65 points. This is by far the largest pullback since this uptrend began in early-November. It is also the longest pullback in time as well. Looking at the SPX hourly chart, Nano wave ii only took 3-days, and this pullback is now 15-days. This appears to be quite out of balance. Micro wave 2, however, took 10-days, and this appears more in line with what has recently occurred. Also it fits the ongoing DOW hourly count as well. Will continue to keep both counts active, but now lean toward a Micro 4 underway instead of Nano iv. After the SPX hit 2401 and started to pullback, we anticipated some choppy activity going forward as a lot of smaller 5th waves had to unfold. But nothing like this type of decline. Should the market fail to rally from here, and then break the 2321 pivot range (2314), we would have to consider a correction is underway. Short term support is at the 2336 and 2321 pivots, with resistance in the mid-2350’s and the 2385 pivot. Short term momentum displayed a positive divergence at today’s low. 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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174 Responses to Wednesday update

  1. vivelaamo says:

    Even though Russel has led the way down the still yet to close under the support at the 1440 area this year!

  2. gary61b says:

    If the ES pushes down hard I have a support at 2327, but just till midnight.

  3. phil1247 says:

    Fotis

    SPX close 2347.23

  4. Page says:

    Tomorrow OBAMACAREEXIT will be similar to BREXIT.

  5. Amash just came out and said “A vote tonight would be a mistake–it would lose.Trump not making concessions.”

  6. fotis2 says:

    And thar she blows! Viva la Newbie!!!

  7. pooch77 says:

    Tony help, getting emails for comments and the box is not check, CA. you stop these

  8. blackjak100 says:

    I get the sense we are in minor 4 because the 8 Dma crosses below 21dma for first time since minor 2 and I like NK count . Minor 4 should be a sideways correction to alter with minor 2. The most common type is a flat. This suggests A completed @ 2336 with B underway to reach 2395ish at a minimum. C should finish at 2321 pivot. Just a thought

    • ewmarkets says:

      Where is the bottom of your Minor 2? Is it the low of November 2016?

      • blackjak100 says:

        Correct – but if ED, then it’s just minute 2 of minor C of int 1 using conventional EW labeling

        • ewmarkets says:

          If November bottom is end of 2, then there should have been 5 waves from that bottom. I find it hard trying to count 5 waves from Nov. 2016 low. It looks like 3 waves to me. However, one can count 5 waves from 6/2016 low on SPX.

  9. phil1247 says:

    looks like PHFILL PIVOT will be tested

  10. zedozpipozzz says:

    Hi Caldaro.
    When can you change the green of the iv to gray? I mean … above what value can we assume that the iv wave is already finished?
    Thank you and good work

  11. micky says:

    You see what I mean Vive, small trend has been broken..there are many ways to trade and my way works for me..Like I said I am scalping the long side only until the main trend is established again.

  12. NEWBIE says:

    Is everyone here bullish yet so we can get this wave down to 2315 underway?

  13. blackjak100 says:

    Phil, is it OK to be long now?

  14. vivelaamo says:

    Nice bounce earlier than expected. Lets see if it gets sold in to…

  15. Ajay Singhi says:

    I am not going to respond to trolls who provide no value addition here. I have never failed in any of my no SL calls. Views may fail, no SL calls don’t.

    View was that holding 2267, SPX will make one more high above 2304 but will not sustain. It failed.

    Call was to short SPX at 2300, tgt 1990 and 1500. Nothing in this world can stop 1990 on SPX within 2017 and 1500 within a few years.

    See you at 1990.

    • vivelaamo says:

      Lol. Let me see if I can dig up how much value you add….

    • vivelaamo says:

      Also in case you didn’t notice we went to 2404 after your call. All the best.

    • Page says:

      Ajay: SPX 1500 within few years? what is ‘few years’? 10, 20, 30, 40, 50, 100 years???

    • phil1247 says:

      Ajay

      are you XU WOO?

      you sound as dogmatic as he was before he blew up

    • kjb0 says:

      Do not despair Ajay, this has always been a tough board if you dissent. And I have been here since Moby Dick was a minnow. I come for Tony’s view only. But he has been wrong on the biggest calls also. There was no C wave to retest the 667 low, and his “quantified ” end to the fifth wave to start the bear market was also wrong. Having said that, Tony is very good at what he does as nobody is perfect.
      I posted a few months ago that we are in a rolling manipulated top. We are not in a primary wave 3. The top may be in or we may make another slight high…nobody knows. As such, I am building a (short) long term positions. Come the Fall, we will be several hundred SP points lower. I don’t worry about the short term swings, that is where the day traders donate their money and how the brokerage firms stay in business.

      • vivelaamo says:

        If you are going to state views as fact then you have to accept comments when it goes horribly wrong and just hold your hand up!

        This board is full of people just wanting to be right rather than actually help people.

  16. GDX pulling the same pattern as last September and November–a breakout over the 34 d avg,but slapped back down under it.The 13 has not crossed over the 34.GDX did not close over 23.45.Unless that last item occurs–this sets up a bearish scenario.

  17. ariez5 says:

    IWM looks extremely bullish. Stop on close below yesterday’s lows.

  18. From a minute ago.

    House Speaker Paul Ryan pushed back his 11:30 a.m. Eastern news conference to 3:30 p.m., in a possible sign that Republicans are still searching for votes on their health-care bill. House leaders have been planning to vote on the American Health Care Act Thursday but reports have said they are short of votes. President Donald Trump is meeting with conservative members Thursday morning to drum up support.

  19. gtoptions says:

    Thanks Tony
    Only thing that matters right now is the HC Vote.
    But you can argue high probability support is being tested…..
    SPY ~ EW 2/4 channel & Support at W/M/Y Pivots
    GL All

    https://www.tradingview.com/x/Aft6MrGR/

  20. ariez5 says:

    If you are bearish, AAPL looks like a beautiful short with a stop over yesterday’s high, which was a perfect .618 retrace of Tuesday’s drop.

  21. CNN Fear gauge reflects Intermediate Wave 4 vs Int Wave 3 highs at 2401. 2326 remains my call with 2302 possible yet.

  22. phil1247 says:

    most people here seem to only be looking up for spx

    the talk is”’
    i will sell at the next high .
    ..i will ADD lower till i have a million

    what if everyone is wrong..?

    still bearish below 2353 /esh7

    would rather be SHORT than long

  23. kingfrogcash says:

    Big Banks have already corrected 5% to 7%. Another sector rotation. All the sectors are not correcting at the same time. The media is saying it’s all dependent on the healthcare Bill.
    But that doesn’t affect anything. The Bank correction was based on the FED meeting.
    The guru’s that had it right last year are mis-stepping. Thomas Lee is out in the woods wandering around.

  24. pooch77 says:

    go figure 12th hour stick save on health care bill?

  25. Ajay Singhi says:

    SPX cmp 2348. Target 1990 within 2017 still intact. Long term target minimum 1500 still intact.

    One more high above 2400 still remaining though(not immediately).

  26. “Should the market fail to rally from here, and then break the 2321 pivot range (2314), we would have to consider a correction is underway”
    Regarding the above comment. does Tony mean a correction greater than Micro 4? Like a Minor 4?

      • If there is a possibility that this last wave could be labeled as a Minor 4 in the Spx count, then all we have left is Minor 5 to complete afterwards. Which would leave Primary III much much shorter than Primary I.

        if this is the case, any chance that we are in primary V then? because it would also be unbalanced that primary 1 lasted between 6 and 7 years and Primary 3 may conclude anytime in the next 12 months.

        • tony caldaro says:

          This is exactly what happens when “what ifs” are entered into an analysis.
          To avoid paralysis analysis just anticipate, monitor and adjust.
          Investing is not day trading.

        • chrisk44342 says:

          I think you have forgotten the intermediate wave labeling. Don’t mean to steal tony’s thunder- but according to his count minor 5 would not mean the end of primary 3. Also, you should always remember that subdivision is a way of life in EW parlance. Who’s to say that P3 is not subdividing via 1-2 1-2 at the intermediate wave level? I don’t think anyone will ever know the answer to these kinds of questions until after the fact. This is why I feel EW is a great tool for providing context but not so great for predicting things. And yes, I agree it’s possible we are in P5, but to me this is all secondary to profiting from trading. I’d rather be wrong about the wave count, yet see my account increase or preserve capital for that matter.

    • fionamargaret says:

      ..late at night I sometimes think of the Irish poetry you submitted George…helps my thought process…

  27. What’s next for U.S. stocks after the S&P 500 suffered its biggest percentage drop in five months?

    Dennis Gartman has warned “this is the start of at least a 5% correction, and perhaps something far worse than that over time.”

    You know what to do.

  28. stormchaser80llc says:

    My proprietary Technicals Model was lower today despite an improvement in breadth on a market bounce. Its signal went to SHORT the market today. My favorite signal has been bearish for some time and is now at a level that could support bearish tones for up to two more weeks, but perhaps a shorter time frame.

    SPX hourly looks to support one more higher high, while an uptrend is now expected for oil. SPX Daily chart not bullish with price well below its 20 dma, and still below its Bollinger Band. HYG:IEF is on the cusp of a collapse, closing below its 100 dma and lower Bollinger Band today with no positive divergences. Watch this ratio closely!

    My proprietary Technicals Model has rolled over nicely and is negative once again. My favorite signal has been bearish for some time and is now at a level that could support bearish tones for up to two more weeks, but perhaps a shorter time frame.

    My site (http://navigatethemarketstorm.com) is completely FREE. However, be advised that I do ask folks to take a few seconds to register for a log-in, making sure you agree to my legal documents.

  29. blackjak100 says:

    NK changes his count drastically relatively speaking….bull market top closer now than previously thought but still 12-18 months???

    • hi blackjack! who is NK? thanks

      • blackjak100 says:

        Nate kautz out of Minneapolis. This is the most popular count for P5 which likely means it’s not the correct count. Minor 2 of int 3 moving into int 1 territory is a big red flag for me. What if it turns out to be a large ED which will take 2-3 years to complete??? Wave 1 of ED not even complete.

        • Millan Tomic says:

          ED seems like base case to me, protracted one which could even go into later 2018. But there will be lots of ops to make money since if this is Wave 1 then u have 4 more large waves in both directions. ED makes sense also politically given that all depends on fiscal policy which could be rather volatile with DT and Congress, so large ups and downs after the honeymoon period which pretty much ends today with HC bill

  30. Nadeem’s latest analysis just came out this evening.
    “DOW drops to 17,700 by August–giving back all the post election gains.”
    (subject to revision,he added).

    • fionamargaret says:

      I mentioned the algo on oil this morning L as I thought you were thinking of shorting.
      I think perhaps they don’t want to dispense with the reflation theory just yet…or perhaps a big rally to include oil. I am not short or long because it is too choppy The algo is still 47-51. (didn’t even change when the market crashed).

      • I’m really only following oil as an indicator for equities.Appreciate all your efforts to enlighten me Fiona.Hopefully,some of that info makes its way to a working brain cell….lol.Loved that Tranny chart the other day.Might be the whole ball of wax,depending on which way that breaks.G’night.

  31. ES just retested the 50% short at 2348.88. The “high” was 2348.25 that is a front run of 3 ticks. It was defended so far. If one wanted to take a short position @2348 .25, that would have been your entry. You can use a stop of a “few ticks” above the 61.8% retrace at 2353 (depending upon your trading philosophy/rules). But be careful of too tight of a stop as a breach of ES 2353 confirms a trend change with a an immediate, underscore immediate, 50% LONG with anchors drawn at the new high and today’s low.

    Hope this helps.

    • fionamargaret says:

      Yes, this is the same Requiem as last night, but the version that is considered the best…so powerful and majestic, I wanted you to hear it. “The best piece of music ever written” deserves a repeat
      How can you not believe in the basic goodness of mankind…I remember saying this to the judges, who just looked at me….I know now what they were thinking…..x

    • Bud Fox says:

      Good RJ report Fiona….Thank you….

  32. WASHINGTON — President Trump and House Speaker Paul Ryan pushed conservative lawmakers to get behind the GOP health care plan Wednesday, but their efforts appeared to come up short, casting Thursday’s vote into doubt, along with the ability of Republicans to drive a legislative agenda despite their control of the White House and Congress.
    –Boston Globe-hour ago.
    Should know during US market hours whether they pull the bill from the floor or not.Or even tonight possibly.

    • Dex T says:

      I hope it doesn’t pass.

      The GOP needs to scrap the current Obama plan and take time to craft a proper one. Or just do nothing.

      • CNN,of all places,is indicating some movement toward compromise–that wasn’t there an hour ago.Futes are smelling something .Ira Epstein says most likely resistance for SPX is 2367.He’s not bullish,but concedes that number could be rallied to.Who knows,but for some reason equities are doing their usual “hopium dance”.We’ll see if it was that,or a rain dance.

        • Will rally no matter what. Short the close on Thursday

        • Dex T says:

          Maybe, but there’s a fair amount of resistance from many different corners. A few people have swung into the yes but how many more will do by tomorrow is tough to say.

          It’s been tough to gauge what reasons the markets move on and why. Can only trade the very short term.

  33. opader says:

    SGS ticked down today, signaling more selling ahead. DJT has a confirmed a trip top formation now and RUT has confirmed a top head and shoulders formation. Objectives for those formations are 200 D-SMA’s for both DJT and RUT. So, if DJT and RUT are on their way to test their 200 D-SMA’s, we can conclude that other major indices are not that far behind. Chances are good that SPX is on its way to test its 50 D-SMA around 2325 and then 200 D-SMA around 2200.

  34. torehund says:

    Some dreamy air for you.

  35. 123 abc says:

    Tony, is the following count possible under OEW theory and has it been considered ?:
    i.e. Currently in Primary-iii → Major-1 → Intermediate-iii → Minor-3 → Minute-i → Micro-4

  36. torehund says:

    Made a projection on the whole wave structure, which is a reversed 5 wave. It unfolds according to long range oscillators which are all very positive except for the 60 min which recently has retested bottom. So I prefer the uppermost projection which is the most bullish.

    • torehund says:

      Noticing a reversed wave like the above is important. Whats important to note is that latter to the reversed wave a new of equal magnitude commences but then not reversed so normal 1-5. Think this wave is the first of P III then an equaly lagre 2 of PIII is to follow afternoon the retrace. Then 3 of P III will be one Helluva monster squeeze.

  37. bouraq says:

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

  38. mtu MTU says:

    [EOD] Stocks-
    SPX kisses the neckline (Chart 1) and hugs the down channel (Chart 2). ES tracking from the high (Chart 3).
    http://market-timing-update.blogspot.com/2017/03/market-timing-update-32217.html

  39. Thanks Tony and kudos on a very accurate pivot. If micro iv is underway, have you changed the count or are you viewing nano v as a failure? After tagging the pivot, the market seemed preoccupied with putting in higher lows which is constructive but when this reverses we will know we are likely heading lower. We might see tomorrow what we saw today but on Thursday, and should the House fail to pass Trump’s healthcare plan which is likely the case, I would guess we head lower. Like him or hate him, the market has much invested in him. And in the event there is more buying tomorrow than I anticipate, the acid test will likely be in the ES 3353/54 area.

  40. vivelaamo says:

    Another Trump rally tomorrow or Friday?

  41. Micro 1 was 49 points. From 2336 that would make micro 5 equal 1 at 2385. No new highs, yes micro 5 could go higher, but 5th waves have typically been the shortest in this bull market. So that leads me to beleive we are in a dealer correction. Minor 4 underway at a minimum.

  42. pooch77 says:

    We could see some more down yet tomorrow into Friday as the daily charts are pointing straight down.I went long mid day on my ira via tna and long at close on 401,I think if we down tomorrow that should end the trend then back up into second week of April 7-10

  43. phil1247 says:

    http://tos.mx/acAMNc?image

    /ESM7

    the extension short traded perfectly at 2349 ( oval)
    target is 2324

    there is no reason to be long while we are below 2353
    because while there may be
    ” support” levels below …they are only potential support
    the only way that that support can be validated
    is by breaking the extension short .618
    level at 2353..
    otherwise its a slippery slope into oblivion
    breaking “support” levels all the way down
    similar to what happened to bonds when they came off their peak

    • fotis2 says:

      I was at first sceptical about DH’s methodology but now after following his videos for some months I have to say very impressive trader.

    • Gary Rodgers says:

      Hi Phil,

      I enjoy your posts and looking at your levels. Could you possibly explain how this particular setup translates to an actual entry level. You have the low from 2365.50 to the low of 2332.75 today and the stop (risk) at the .618 of that range-and you are therefore bearish below that .618 level. I get that (I think) but where would the entry be determined between that range. I see the first profit target at the 23.6 extension of that range as well. Thanks very much.

      • Gary…not speaking for Phil or DH but the 50% short traded at 2348.75 this afternoon. That was the entry. The profit target is 2324.50. Currently ES is trading in “no mans land” meaning in between a 50% short and the profit target. Sure a 50% micro short can develop that leads the ES into the profit target. On the other hand, the ES futures could rally from here and brake the short at ES 2353. That would be a trend change for me. Just the way this algorithm trades.

        • Gary Rodgers says:

          asaraniti,

          Thank you very much. So until you get back to a 50% retracement of the low to low range there is no trade. You enter at 50% and stop at 618%. So what happens for example if it never gets to 50% and goes lower from the 382%? You just don’t have a trigger for entry and no short using this methodology.

          • vivelaamo says:

            You can take an aggressive short at 38.2 but best to wait. Take the trial on the link I sent you if you want to learn more.

          • Not sure I follow you so permit me to answer your question this way. Currently there is no entry into either a long or a short. Entries for a long or short would be:

            1. A short if the 50% retrace was retested ..ideally with a >-400 tick.(meaning – 401 or weaker). Don’t need to place a stop above the 61.8 % retrace as that would be a trend change and there would be an immediate pullback at that new 50% long to confirm the trend change.
            2. A short if the ES trades a bit lower and then a micro short develops between the “new” 50% low to todays’ high is traded again ideally with a >+400 tick. Cover if that micro short trades above the 61.8% retrace as a rally to today’s high would be a very, very high probabiity.

            3. A long, if the profit target was hit again, ideally with >-400 tick and depending upon your risk tolerance..wait to see if that profit target is defended. ES could easily trade lower than the profit target and continue lower. Need to place stops depending upon your risk tolerance.

            Gary for $.01, a penny, you have access to all DH webinars and live trading for 2 weeks.

            Hope this answers your question.

            • Gary Rodgers says:

              asaraniti, thank you very much for the time and explanation. thanks to vivelaamo for the link. and thanks to Phil1247 for his interesting posts throughout the day.

      • phil1247 says:

        i dont want to be long below 2353 es

        but that does not mean i want to be short now either

        the daily extension long was violated at 2333.33 but we are still above it
        i really am not that enamoured about being short until it actually fails

        also the long from wed low to now at 10pm has a .618 support at 2339

        sometimes NO trade is the best trade

  44. blackjak100 says:

    Sharp Micro 4 also has good alternation with sideways micro 2…

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