Thursday update

SHORT TERM: lower open in choppy day, DOW -5

Overnight the Asian markets gained 0.3%. Europe opened higher and gained 0.7%. US index futures were higher overnight, and at 8:30 weekly jobless claims were reported higher: 258K v 241K. The market opened 4 points below yesterday’s SPX 2348 close, ticked down to 2343 in the opening minutes, then started to rally. At 10am new home sales were reported higher: 592K v 555K. The rally continued until 11:30 to SPX 2359, in hope that a healthcare bill would be passed in Congress today. When that hope began to fade the market started to pullback. At 3:30 the SPX hit 2343, then bounced to close at 2346.

For the day the SPX/DOW lost 0.05%, and the NDX/NAZ lost 0.15%. Bonds lost 1 tick, Crude slipped 35 cents, Gold dipped $2, and the USD was higher. Medium term support remains at the 2336 and 2321 pivots, with resistance at the 2385 and 2401 pivots. Tomorrow: durable goods orders at 8:30.

The market opened lower today, even after the futures were higher in overnight trading. The pullback was 5 points from yesterday’s close, then the market resumed its rally from yesterday’s SPX 2336 low. After rallying 23 points to SPX 2359 the market reversed and headed back to the lows of the day, after the healthcare bill stalled in Congress. It appears some version of the healthcare bill needs to get approved before the tax cut bill can be worked on. Which is what the markets are focusing on. Before we can be fairly certain the current pullback has ended, the market needs to rally 35+ points from the low. Short term support remains at the 2336 and 2321 pivots, with resistance at the mid-2350’s and the 2385 pivot. Short term momentum hit overbought today after yesterday’s positive divergence, and ended the day near oversold. 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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151 Responses to Thursday update

  1. phil1247 says:

    ok ….

    i thought a 10 point surge……………

    it was 15 so far and right back to where??? anyone ??anyone??

    bueller ?

  2. gary61b says:

    Was that it, Another double bottom with a + div. on 60 SPX. If not 2330 on ES will be line in sand all the way to 2300.

    • wavediver says:

      Report the healthcare bill is being pulled. Speaker Ryan speech at 4:00 EST. Volatility relaxing at the moment.

      • purplember says:

        Gonna have to use the opp. way. ram it thru senate with bribes – only need 51 votes. oh wait let’s do it on a holiday when no one is watching. transparency !!

  3. vivelaamo says:

    So Trump losing the vote is very bad news for stocks right? As was Brexit, Election and Italian vote. Lets see what happens next week. Have a good weekend all.

  4. vivelaamo says:

    Something brewing. Covering longs for a potential sharp move down before the long term trend resumes.

  5. pooch77 says:

    Looking for a down move into Wed/Thurs.

  6. phil1247 says:

    just based on what i am seeing in the chart of spx

    IF some news comes out at 3pm
    i would expect a 10 point surge
    so i guess it would be good news whatever that would be
    lets see…………….

  7. WBBM radio says a vote around 2pm CDT.Anyone else hear that?Market trying to fake us out…or doesn’t it care again?

    • phil1247 says:

      market doesnt care and never did
      will close at spx 2348

      • Data from Baker Hughes BHI, +0.24% Friday revealed that the number of active U.S. rigs drilling for oil rose by 21 to 652 rigs this week. The oil rig count has climbed every week this year so far, except for one. 
        Does oil care about supply?Not yet.
        Do stocks care about growth (or lack of it?)not yet.
        What does the dollar,bonds and gold care about?
        Nothing?Just algos?
        What kind of market is that?
        A rigged market if fundamentals mean nothing.

        • phil1247 says:

          learned

          u go to the casino..
          ..you know how to play the game.
          .if you dont u lose all your money

          same principles apply here

          • gary61b says:

            In a trade you can control your risk or amount you can afford to loose with a stop. In a casino its all of your bet or your not playing.

            • phil1247 says:

              you control risk in the casino by money management
              …ie bet size
              your stop is how much u are willing to lose before you “stop” playing

          • To compare the two,if I play poker and get a royal flush but don’t get paid,though they say you ‘re supposed to–there are no rules.If oil price is understood to be correlated to supply,but doesn’t drop on increasing rig counts–there are no rules.Or the rules have changed to:don’t be bearish on anything(oil,dollar)that will interfere with the bull market in stocks.I’ll try not to bitch anymore about it.

            • phil1247 says:

              “correlated”….that is the problem

              u have been watching ira epstein but maybe you havent heard him say…

              cover up the name of the chart..
              .because if u know what it is
              ..you have a bias of what you think it should be doing …

              that s why i dont try to correlate anything
              and dont listen to news until the market is closed..
              all i care about is when the news is coming out
              ..i dont care what the news is

            • Dex T says:

              The oil market is better than U.S. equities at least. Oil is well off it’s recent highs in the mid-50s.

              It’s still overpriced (should be under 40) but there are ton of speculators and oil based economies (OPEC) that are unable/unwilling to adapt to the current situation.

              Only a major catastrophe can get oil back anywhere nears its old highs.

        • vivelaamo says:

          Learned you sound like Johny and Newbie.

  8. cj32 says:

    Cr. to CBZ

    • fionamargaret says:

      …remember the oil algo is 47-51….oil futures can be bought to make oil go up to the higher number….oil always seems to go against the grain….

  9. torehund says:

    Good weekend bulls and bears, just waiting for the roar 🙂
    And thanks to Tony for his calm head in all markets.

  10. pooch77 says:

    So Ryan scrambling to White House,is he scrambling to give vote?

    • vivelaamo says:

      Joka! You want to see the common man lose money?

      • Dex T says:

        The “common man” isn’t involved in gambling in the markets.

        • vivelaamo says:

          The ‘common man’ invests in funds, pensions plans, company share schemes etc. A big market crash wouldn’t hurt them?

          • Dex T says:

            The people you are talking about are a minority of the US population and even fewer worldwide.

            Most people’s assets are mainly tied to real estate -their homes. Most of their incomes goes to pay mortgages and basic life expenses. Only a small portion will go into savings or stock.

            Those who have significant stock assets are even fewer.

            When you talk about stocks and the market you aren’t talking about the common man. That’s wall street delusion.

            • vivelaamo says:

              In the U.K. a lot of the so called ‘middle class’ are invested in the stock market. Normally through company related schemes. A crash would effect more than just the rich. I don’t know how it is in the US but when I talk about the common man in the UK. I’m talking about those hard working people that are able to save enough money and they wish to invest it someone when interest rates are rock bottom. At 0.25 base rate those that have worked very hard and saved money are getting nothing in return with then safe option.

              • Dex T says:

                I understand what your saying and it’s true to an extent- sure people will be hurt but they are the minority of the population . Of the minority of households that do own shares in some way most of those tend to be smaller amounts.

                Investing has always been a game for wealthier people.

                Crashes hurt the upper classes far more because they have substantially larger amounts invested.

              • vivelaamo says:

                It does hurt them more but they are in a better place to take the damage. I can understand someone calling a bubble and thinking we will crash. I can’t understand somebody getting happy by it.

      • NEWBIE says:

        Vive, the economy is crapola. You have taken the bait of the Wallstreet crooks. This is not about wanting to see the common man lose money, this is about reality. We are in a monstrous bubble that has been building and building- only to pop. You either recognize it and steer clear of it or become a victim of it.

  11. mcgcapital says:

    Looks like bearish consolidation to me. I sold more FTSE at the 7340-50 resistance area. If a down move is underway then 7100-7200 looks a decent target before more bull. If the healthcare bill passes we will see a relief rally but it’s only the first stage, so I’d be surprised if we popped more than 0.5%-1% or so. It was never going to be easy to meet Trump’s agenda in good time and the market has been far too optimistic.

  12. vivelaamo says:

    Rut led the way down and now it’s leading the way back up.

  13. phil1247 says:

    Fotis

    SPX close …. 2348.23

    you have till 3:45 pm today to make your pick

    see you next week !

  14. dan pulford says:

    GOP health care has to much disinformation from the liberal left media and not enough republicans to pass todays vote. imo

    • purplember says:

      if it doesn’t pass, it wouldn’t surprise me if they let Obamacare DIE on it’s own because it’s a horrible bill that is falling apart at the seams. Congressman that did not vote for today healthcare reform will have to explain to voters how they basically supported “obamacare”. can you say “career ender”

      • alexhartley1 says:

        I believe Obamacare was pretty much designed (written) to fail with the intention of the US Federal Government taking ever more control of healthcare in the future. It’s the socialist way. They control foodstamps, welfare, healthcare and have a militarised police force backed by a massive surveillance security service. Long term the United States seems a pretty scary place to me. The UK doesn’t look a lot better. Slowly but surely one’s liberties are being eroded. People don’t notice it because it happens so slowly but sure enough it’s happening. I read somewhere that the average person US unintentionally breaks the law something like 3-5 times a day.

        • tony caldaro says:

          To outsiders America can look a bit scary
          To Americans there is no other place to be.
          Everyone has food, shelter, clothing, access to education and healthcare.
          Opportunities are unlimited.
          If you want to be the next Bill Gates, go for it.

          • alexhartley1 says:

            I don’t disagree with what you’ve written Tony but I do think civil liberties are being eroded and the middle classes continue to be squeezed. Compared to other parts of the globe it’s clearly still a far better place to live.

          • vivelaamo says:

            It looks scary because of guns. That aside seems a great place to live.

  15. zedozpipozzz says:

    Hi

    “US Congress votes to pass GOP health care bill, trying to replace Obamacare. Investors will track this vote to assess Donald Trump’s credibility on delivering his promises.”

    Are they going to vote before or after the markets close?
    Anyone know what time it might be?
    thank you

  16. torehund says:

    We know it, brain has all figured IT out beforehand, its just that we are too afraid to follow though. So we fight it, or in anxiety pull Away from the instinctive path, too afraid to dig our concentration deep enough and to pursue the target from draw to hitting bulls eye. That be stock trading or archery, thats all we need to know.

  17. Atlanta GDP upgraded to 1% from 0.9.

  18. NEWBIE says:

    Bank of America getting spanked, that’s a heads up of what’s in line for spx.

  19. GARTMAN CHANGES MIND AGAIN.
    Just two days after Gartman said the “this is the first time in a very, very long while we have actually gone short of equities, but it is our intention to become even shorter of them, hoping to sell a bounce that might develop intra-day” following the Tuesday slump, the “world renowned commodity expert” has once again covered his short.May the selling resume.
    —Zerohedge article

  20. Long term count has not changed, but here is update

    Int 4 of Major 3 of Primary 5 continues… 2326 was our call on March 3rd

    We had projected 2406 back in late November for the 3rd of a 3rd top

    • blackjak100 says:

      Int 2 moving into maj 1 territory is a big red flag. Simply suggest an ABC which still needs int 4 and 5 to complete which may just be maj 1 of P5 ED

      • no matter the labels, the fibs have been perfect all the way up from 1810… very slick to see… we are making a lot of bank with small caps of late. Feels like 1999 for sure

  21. I used to think the market “knew something” when it rallied before events like this.Then they got Brexit and Trump wrong.Maybe they just don’t have voters figured correctly. and do better on inside politics info .Or maybe they just position themselves bullishly,no matter what.
    Rumor has it,PPT was told to cancel all vacation for the next week..lol,just in case there’s a NO vote.So will they pass it?I can hear the bones snapping as they twist arms today.Tough call.

    • phil1247 says:

      learned
      news cannot change the trend

      it can create volatility

      • It would have on Brexit and Trump,but was not allowed to.I think even if the vote goes against Trump,it’s a one day wonder.Free markets went out the window in 2009.

        • phil1247 says:

          i dont buy into conspiracy theories

          Brexit /es smash
          i showed with charts how it traded perfectly..

          rallied to resistance …..extension long failed…then beautiful plunge ..

          all very technical..
          just exactly what happens every day if you want to see it
          all you need to do is see where the algos live
          because most trading is not done by humans

          • Circuit breakers stopped the fall both times,after which a miraculous rally appeared–and never stopped.The ECB said straight out,”We have billions of dollars to support the market–if necessary.”
            It was necessary.

  22. phil1247 says:

    /CLK7

    above 48.14 look for C wave squeeeeeeze up to 49 area ….

    then collapse continues

    if there is a stock /oil correlation…….well u know what happens then

  23. opader says:

    Click on your seat belt … might get pretty rough today 🙂
    http://balancetrading.org

  24. nyjsec314 says:

    The only significant exposure to equities I am holding are international. Heavy on emerging, Europe, Korea , and in US Biotech , silver and
    a tiny portion of us index.

  25. vivelaamo says:

    in my opinion today’s news will cause nothing but volatility. Lets wait until next week to see if either the longer term uptrend resumes (which I think it will as support has held) or this short term down trend turns in to a deeper correction. I honestly don’t believe today’s news will have any bearing on either outcome.

    All the best.

  26. Ira Epstein’s top points today..imho:
    WTIC:Embedded and headed lower.
    ViX:After a long period of sideways action,”I’m very nervous about a breakout to 20 and above.”
    SPX:”Very concerned.Would not be brave here.”
    PMs:”Overbought,but a gold rally past 1258 would be a bear trap.”
    G’night all.Or good morning.

  27. stormchaser80llc says:

    SPX bounced today making a new high which I was expecting. At today’s high, SPX hourly had some negative divergences which supported a pull back at least in the short term. Breadth recovery is muted. I was surprised VIX rose today, was expecting the negative divergences to play out. At today’s highs, these negative divergences were only strengthened.

    HYG:IEF closed back inside its Bollinger band just shy of its 100 dma. Oil went down today which was unexpected since technicals all support a bounce.

    My favorite swing trading signal remains bearish. My proprietary Technicals model was even lower today, suggesting this uptrend is only a bounce and has no legs. Daily charts all look weak so after this bounce expecting the downtrend to continue, but maybe not until next week?

    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.

  28. mtu MTU says:

    [EOD]Stocks-
    SPX closed below the neckline after having kissed it, but has failed to breach yesterday’s low. See charts.
    http://market-timing-update.blogspot.com/2017/03/market-timing-update-32317.html

  29. Thanks Tony
    DOW
    invst.ly/3it31
    Oil
    invst.ly/3inlx

    • fionamargaret says:

      I chose Bach’s St Matthew’s Passion….the first version is an abbreviated version… the second being the recognized best version and the complete work. (depends if you have 90 mins. or 3 hrs).
      This is a powerful, sorrowful yet intimate story, of the events leading up to the crucifixion of Christ…and you will be surprised at how familiar some of music seems….recognize this…

      • locanbbs says:

        Unbelievable that you’ve guessed my favorites already! Wish for you even so much success guessing these markets. Thanks!

  30. Imho,Spicer gave no indication of confidence that this insurance bill will pass tomorrow.In fact,he said that Trump noted,if the health bill goes down,”We move on to tax cuts.”
    That might be the REAL reason equities are rallying.Maybe Trump just said,”Screw it,we should have worked on tax cuts anyways.”
    Whatever it is…the markets want to rally.Gartman strikes again.

    • ariez5 says:

      “Nobody knew health care could be so complicated.” Actually, everybody except Trump knew. Given that his poll ratings are in the gutter now, he is seriously regretting tackling this issue, but in the next nine months while he is still in office he will use the failed vote tomorrow against the House Republicans mercilessly.
      I agree, this is why the futures are spiking. Most people realize Obamacare is better than any of the BS the Republicans suggested, and they are glad to move on to something else.

  31. tommyboys says:

    Futs spikiingva bit. We may have a completed ABC pullback for minor iv.

  32. opader says:

    SGS ticked lower today, signaling more selling ahead. Very short term (minutes to hours), however, I think we’re going to get a rally, very likely tomorrow. For now, market internals and breadth are predicting that Trump-care which is really a big tax cut for the 1% ($830B over the course of 10 years, with $130B in its first year) gift wrapped with healthcare paper is going to pass in the House.

    • Dex T says:

      Market internals have zero to do with the healthcare bill.

      • opader says:

        It’s not a healthcare bill, it’s a huge tax cut for the 1%. And if passed and becomes law (not likely b/c it will die in the Senate unless significantly changed), that tax cut will find its way into the market.

        Internally, today was bullish (Adv vs. Decl was 19 to 10 in NYSE and 18 to 10 in NAZDAQ, Up Vol / Dn Vol was 2 to 1 in NYSE and 3 to 1 in NASDAQ, NH’s went up and NL’s went down). So Market is predicting a high chance of its passage of the bill in the House tomorrow. Tomorrow will be a big up day on the back of short covering.

  33. bouraq says:

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

  34. pooch77 says:

    So is there a leak ,futures looking very strong

  35. A big thanks Tony for your tireless efforts to make sense of what does not make sense. Your remark about passage of healthcare being an essential antecedent for tax reform and infrastructure spending is spot on and something I have mentioned along with countless Wall Street observers.

    But even if the House passes the bill I don’t think it will get through the Senate, even under reconciliation. Rightly or wrongly, it’s being viewed as proxy for his ability to press on with other measures in his agenda, notably corporate tax reform.

    Interestingly today’s high was almost exactly a 50% retracement from the high point of breakdown to the recent low; I don’t think its significant that it rose above the ES 2353/54 level though on a non-news day it might prove otherwise.

    Unless the market decouples from the Trump train, my view remains that failure to pass some type of repeal and replace will not be constructive for the market over the longer term. But I think there is another House vote scheduled for tomorrow and if it passes we might get a bounce, a bounce that might last until whatever happens in the Senate and reconciliation.

    From Jeff Saut:

    Plainly, our cautious stance since the late-January/early-February time frame that our models targeted as a downside window of vulnerability has looked wrong-footed until last Tuesday, but quite frankly, we do not see where a whole lot of money has been made since the first week of February. The question now becomes, is this the beginning of a whoosh on the downside, given the still high level of “internal energy” available yet to be released, or was that it on the downside? The answer to that question likely comes today with the vote on the Trump healthcare bill. Until that resolution, we remain cautious, consistent with our models.

  36. tony I wonder if there should be UPTREND, DOWNTREND and NONE/NEUTRAL/UNDECIDED. with the market having a rally of 23 points to then give most of it up, it really doesn’t feel like an uptrend but one of UNDECIDED waiting for a catalyst to move up or down?

    If I was to walk into your blog cold and reading that we’re in an uptrend market, it might be slightly misleading?

    I say that because I like to feel “your pulse” and pivot points (most valuable by the way) much more than wave count to understand this crazy market. And so I wonder why you feel we should still be – definitively – in an uptrend…..

    thanks for you valuable blog..

    • tony caldaro says:

      thx
      We have been in an uptrend since November.
      There are only two states in trends up and down.
      To fine tune that you have to read the daily/weekly updates

      • Thanks Tony, I have read every post (for last several years). What I’m getting at, is the trend is not binary. At some points – like now – it is Undecided. at these times, its probably wise to be sitting on the side waiting for direction. Our next direction might be down or up. We don’t know. Certainly not a certain Uptrend….possibly being pedantic..

  37. Thank you very much T.

  38. blackjak100 says:

    NYAD +900 and a close barely above .618 retrace of 2336-2559. Just speculating a big up possible

  39. phil1247 says:

    Fotis

    SPX close prediction a total bust ….off by a full point

    have to sharpen my pencils tomorrow 😉

  40. Bud Fox says:

    Thank You, Tony C…..

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