Wednesday update

SHORT TERM: decline continues, DOW -59

Overnight the Asian markets lost 0.2%. Europe opened higher but finished mixed. US index futures were lower overnight, and at 8:30 export (0.2% v 0.3%)/import (0.2% v 0.3%) prices were reported higher. The market opened 6 points below yesterday’s SPX 2354 close, and then started to rebound. By 10:30 it had rallied back to SPX 2353 before heading lower again. Around noon the SPX hit 2341, then reversed and rallied to 2350 by 2pm. At 2pm the budget deficit was reported wider: -$176.2B v -$108.0B. Then the market headed lower again. In the last hour of trading the SPX hit 2342, then rebounded to close at 2345.

For the day the SPX/DOW lost 0.35%, and the NDX/NAZ lost 0.45%. Bonds gained 6 ticks, Crude lost 45 cents, Gold rose $6, 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 and the PPI at 8:30.

The market opened lower today, declined to the high end of the 2336 pivot range, rallied to SPX 2350, then declined to the high end of the pivot range again. At this point in time it will not take much more downward pressure to confirm the suspected downtrend. The pattern we noted yesterday: 3-waves to 2322, 3-waves to 2378, and now possibly 3-waves to 2299 unfolding. This [2299] should be 1st support for a correction, with 2nd support at the 2270-2286 pivots, and last support at SPX 2234. Short term support is at the 2336 and 2321 pivots, with resistance at the 2385 and 2411 pivots. Short term momentum ended the day just below neutral. Best to your trading!

MEDIUM TERM: downtrend gaining in probability

LONG TERM: uptrend

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

About tony caldaro

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144 Responses to Wednesday update

  1. scottycj1 says:

    Tomorrows CIT should be moved to today

    • CB says:

      GTK, Scotty. Looks like they took your advice and “re-accommodated” it. No problem 🙂
      Have a great weekend everyone!

  2. pooch77 says:

    After this selloff concludes I will stick my next out a say no sell may and stay away

  3. Page says:

    I do think next week it will get ugly so if SPX drops below 2300 then next level 2227 (200dma) is given.

  4. It should have gone much down much faster. Possibly the 4th is giving up.

  5. tommyboys says:

    21k# MOAB GPS guided bomb thing of beauty…prolly not much damage against a mountain though…

  6. torehund says:

    Tbt, now it HAS to be a w-2 botton, not ? Well fake news in stocktrading is commonplace the difference is that we all do our best to discern what is about to happen. What has happend is normally fully agreeable, not so in the age of yellow journalism ! Fake news kills, and let mass media be accused accordingly. Hopefully peace is restorable going hand in hand with a neo-truth movement, happy Easter Tony and all in here.

    • H D says:

      Ha, the people struggling w fake news are the same people that struggled with a birth certificate. It’s a basic IQ issue or common sense issue. Now people struggle with facts or ‘biased facts.’ Desperate attempt to dumb down everything, divide and conquer strategy. It is a war for your mind.

      • tony caldaro says:

        watch what they do, not what they say

        • H D says:

          Agree! I can think of a few examples of that recently Tony. Nobody needs the media to compare what they say vs what they do when we can see it with our own eyes.

          • tony caldaro says:

            2014 the Airlines before Congress … everyone is guaranteed a seat
            2017 United Airlines
            April 9th … passenger viciously removed from ‘guaranteed seat’
            April 10th … CEO I commend my staff for acting appropriately
            April 11th … CEO we are sorry
            April 12th … CEO all passengers will receive a refund
            April 13th … CEO this will never happen again
            149M Chinese have viewed the United ‘fly the friendly skies’ video.
            Great corporate culture they have created at United.
            Gee I thought everyone was guaranteed a seat, especially after you sat in your assigned seat

      • fotis2 says:

        ”Believe nothing of what you hear, half of what you see and everything you feel” I think Edgar Allan Poe said that.I’ve stopped watching news channels for months now and feel amazingly well in any case if its a biggie it will be posted here….

  7. tommyboys says:

    AAII sentiment neutral-bearish again this week…
    http://www.aaii.com/sentimentsurvey

  8. captbara says:

    Looks like an EDT for C on ES. Expanded flat from 2366…

  9. micky says:

    have to see if this small support holds for now, next is in the 30 area

  10. vivelaamo says:

    Us drops biggest non nuclear bomb in history?

    • fionamargaret says:

      …yes in Afghanistan….maybe not great for Easter break….

      • Page says:

        fion.. Easter will be fine … Afghanistan is nothing but Cluster of Mountains and these militants hide in Caves so the only solution is Hydrogen Bomb 😀

        • fionamargaret says:

          I was just suggesting a different locale for Vive…though these cheap UAL flights there…..

  11. Dex T says:

    Silicon Valley Bubble About to Burst
    Published Wed, Apr 12, 2017 | Jonathan Rodriguez, Senior Analyst

    In San Francisco, the median home price is $837,500, according to a study from mortgage research firm HSH.

    That’s more than three times the national median. It’s also higher than the peak set for the Bay Area before the last housing crisis.

    The study also showed that a prospective buyer of a house at the median price would need to earn $160,589.84 to afford it — using a 30-year fixed mortgage rate of 4.1%.

    Unfortunately, the median salary in San Francisco isn’t nearly that high…

    https://www.wallstreetdaily.com/2017/04/12/silicon-valley-bubble-burst/

    • Dex T says:

      Some other interesting stats in the article above. Median home and rental prices are way above median incomes.

      It’s made worse by the fact that a substantial number of jobs are tied to the startup tech companies almost all of which seem to have very serious cash issues-

  12. fionamargaret says:

    As mentioned yesterday afternoon….gold to 1350-1500…. UGLD, USLV, TMF, and UVXY….x

    • aahmichael says:

      GLD has already recovered 100% of its post election decline from 11/8 to 12/15. Bonds have recovered 50% of their decline. The reflation trade was a flash in the pan.

    • fionamargaret says:

      Remember gold and silver are in a very small market….so pop the stop….

  13. Page says:

    Get out of stocks. It will get way uglier than anybody can imagine.

  14. vivelaamo says:

    Kiss of death got posted on this blog today. The only thing that can save indices now is a dancing bear. Happy holidays all 😊

  15. The big question is when does VIX separate down from the upper BB.When it does,it probably drops to 12.37 from 15 this morning–stocks shortcover and gold sells off.Gold loves a rising VIX indicator.This is the 3rd day above the upper BB.Tricky stuff because it could stay above the BB for a few days,get embedded and take on a life of its own.The odds are,it doesn’t
    do that,but retreats to 12.37.Good luck all.

  16. would love to see a 2320 close today

      • probably not, Bulls and algos in charge until 1:30, see what happens then. My account would be very happy if it did, more likely a 2350 pin, but you never know. Have a great weekend all, going to play golf to humble myself some more, cause I suck

      • aahmichael says:

        When it comes to the markets, never say never. Last month’s candlestick signaled a 99% probability that 2322 will be taken out before 2401 is taken out. While that doesn’t mean it will happen today, it does mean that it most likely is going to happen soon.

        • vivelaamo says:

          I believe it can happen soon just don’t think it will be today. Anyway kiss of death was delivered today on this blog so it may be possible.

  17. jhjoyner says:

    Why has NAAIM jumped from 67 to 86 in 1 week?

  18. First thing they do when it hits the fan is save the dollar.Next,it’s the Transports–about 200 points away from a major breakdown.The Russell at 132 is next.Silver trying to finish over 18.50–the next positive sign for PMs.Equities waiting for VIX
    to dive out if its upper BB so it can make a 30pt launch.Gold could correct to 1256
    in all that VIX movement.Later.

  19. phil1247 says:

    Tony

    Happy Easter to you and your family
    and to everyone on the board

    will not be posting again till monday …..( is that cheering i hear?)

    see ya!

  20. micky says:

    38 held..so far..now will 46/49 area offer vst resistance ?

  21. phil1247 says:

    Fotis

    going to join you short /clk7 53.23 via SCO with small initial position

    not that crazy about it but good luck to us !

  22. bud67 says:

    An SP500 rally is due, and soon…..

  23. gtoptions says:

    Thanks Tony
    SPY ~ Test/Fail Decision Time
    Enjoy the Holiday All

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

  24. phil1247 says:

    Gary rodgers

    you trading bonds??
    looking to buy back some 30 yrs i sold yest if ext long holds here

    if not bonds headed into crapper

  25. Ajay Singhi says:

    Buy SPX, cmp 2339, tgt 2390 within April. No SL needed.

  26. gary61b says:

    ES possible move up to 2339.75 before heading lower.

  27. lunker1 says:

    VIX going parabolic seems SPX will catch up soon

  28. cj32 says:

    Cr. CBZ

  29. Lee X says:

    Ahhhh the internet ; )

  30. phil1247 says:

    /CLK7

    looks ready to break short at 53.36
    53.50 daily resistance

    above there sky is the limit
    no reason to be short
    unless these levels stop the advance

  31. phil1247 says:

    DOLLAR
    bounce from daily extension long near 100
    if it completes……….. target is 105.4

    EURO
    wave 3 of 3 collapse down to 0.998 target approaches

    GOLD will be put to the test
    if it passes
    …it may be ready for prime time

  32. fionamargaret says:

    A knock at the door, yet not an ordinary knock…there was a sense of urgency
    I opened the door and there in front of me was the judge…in a brown bathrobe.
    Come quickly he said.
    I followed him into his apartment.
    It’s not what you are thinking he said, trying a sense of humour.
    Remember I went to the cottage at the weekend. I nodded. Well I have poison ivy, and you are a female so you must know how to deal with this, handing me a bottle.
    I went back to my place and got a pair of gloves (the free kind you get in hair stuff) and returned to him, took the bottle and cotton swabs, and trying to appear nonchalant,managed to make him feel more comfortable.
    Remember he said…….not a word I said.
    Then he turned and hugged me.

  33. A lot of people don’t like Ron Insana,for a variety of reasons,but I can’t remember too many times that his commentaries didn’t have some value.A small portion of todays:
    “Bear markets, history shows, are often started by two things; rising interest rates and the onset of war. The Fed is certainly on the path of raising rates. If, indeed, war is a serious risk, then Wall Street will find itself in the teeth of the bear.”
    Smart guy…except when he tries to start a hedgefund I hear.We’ll try this again tomorrow.

  34. UPDATE: “There’s method in this madness!” (Shakespeare, Macbeth) – Seems to me that a few big players are driving this market down with determination. It is well known, for instance, that Soros has gone bearish. And he is known for his determination. Against him and his friends even the PPT don’t have a chance.
    ndx hourly futures –

  35. IRA EPSTEIN update:Russell had a bull trap kick in…should head lower.All indexes have momentum weakening.Gold and GdX is the opposite.Overbought,but GDX got over 80 on slow stochastics for the first day of 3 needed to embed.TLT is bullish.VIX over the upper BB…may pull back,but he says it ‘s a bullish trend now.
    My two cents is if GDX can keep moving up,get itself embedded,a run up to the top black crow and through it is possible.Gold has potential to hit 1330 based on what it did last May in a similar situation.
    Good luck all.

  36. stormchaser80llc says:

    The market has been consolidating since the 3/1 All Time High. My signal based on my Technicals Model went from LONG to NEUTRAL today. This while my favorite signal fell deeper into BEARISH territory. The lone good news today is the value on my Technicals Model only went down slightly from yesterday. The market looks like its feeling its way to a bottoming pattern, one which should end this 6 week consolidation period. Want the market to get above and stay above 2371 resistance line. VIX gave a SELL signal today. Oil has been hot, perhaps when the run settles down that money may make it back to the equities (Watch out with Oil above its Bollinger Band). Beware a quite market, its at the lowest 3.2% of volatility dating back to 1990.

    Much more FREE analysis at my site (http://navigatethemarketstorm.com). 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.

    On my site, be sure to check out the real-time Trading Platform (look for it on the top menu). I am taking feedback on pros and cons!!

  37. Thanks Tony. Things are getting interesting, particularly with oil and the 10yr yield which is now lower than the level after the second rate hike which took rates down to the 2.3% area…….and now we are at about 2.24% after an intraday spike. I’m long bonds and based upon 2/10 spreads feel rates may approach the 2.0% ish level although my target is closer to 2.15% ish. Brown Harriman recently noted the breakdown in the prior correlation between rates and oil. I know you follow all major markets and would like to ask two questions if you have the time: where do you think 10 year yields may go and and are the lower rates raising caution flags about the economy particularly with oil on the upswing? Nothing inverted yet but the Atlanta Fed “GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2017 is 0.6 percent on April 7, down from 1.2 percent on April 4”. As to SPX, we finally closed below the 50 DMA and the 100 DMA now sits at 2300, right at your one of your targets. Lastly there was lots of buying in ES today which COULD fuel deeper lows if things go as expected.

    • Fiona: Thanks for the RJ link..Adams is being cautiously optimistic:

      “but it may be
      difficult for the bears to seize complete control of the stock market if we truly are in an earnings-driven stage of a long-term secular bull market like we believe.”

      • fionamargaret says:

        ..a wee bit better than the quote from Jeffrey a couple of days back “do not play unless absolutely necessary, because the environment is extremely unpredictable”….

        I left you a message on Monday Update……

        • fionamargaret says:

          George, remember the chart you were looking for yesterday – I think it might be amongst the charts in RJ. I hope you are doing well. x

  38. vivelaamo says:

    Expect More downside to trap bears before peaceful resolution with both North Korean and Russia is announced as the catalyst for the long term bull to resume.

    • pooch77 says:

      Something better happen quick cause we got a big turn coming next week

    • I wouldn’t be so sure about a peaceful negation.we have a new sheriff in town. This North Korean problems scares the hell out of me. Seal team 6 in South Korea Japan and us air craft carriers in area. Leader evacuating 600k people from the city. All it takes is 1 person to flinch and you have 1 major problem. I hope I’m wrong, but there is no way I will be holding any stock position over the 3 day weekend. Shocked futures are even up.
      Call me crazy for worrying about the impossible. Will see,

      • fionamargaret says:

        ..sometimes I feel I can’t breathe with the craziness of it all, so appreciate the blog for some form of sanity….

      • vivelaamo says:

        If things were that bad I’d expect the market to be reacting a lot worse. Remember markets make the news 😉

        I agree probably prudent to not hold positions over weekend. We have a 4 day weekend in the UK.

  39. bud67 says:

    as Shailen noted. Thank you Tony, for your work at OEW.
    A must review, each day…..Bud

    • Page says:

      Thanks Bud for your daily outstanding comments……………………….end

    • bud67 says:

      You all, realize. When this Bull market does end.
      One might call it, the longest Bull market ever (?)…
      But, what follows a Bull, is a snorting Bear. Which,
      maybe a dangerous place to hold long positions…
      of course, I am only guessing…But 2007 was a long time
      ago, or 2009 as well….

  40. Trump said the dollar was too high.He’s right–should be about 80.If it got there within a couple years, I could afford to move into Mr C’s neighborhood lol.Anyways,my vote for Trump paid off today.Later.

  41. It will be a hot Easter.

    By James Pearson | SEOUL
    Foreign journalists visiting North Korea have been told to prepare for a “big and important event” on Thursday, although there were no indications it was directly linked to tensions in the region over the isolated state’s nuclear weapons program.

    Around 200 foreign journalists are in Pyongyang as the country marks the 105th birth anniversary of its founding president Kim Il Sung on April 15, North Korea’s biggest national day called “Day of the Sun”.

  42. pooch77 says:

    We need to build up some downward momentum tomorrow to get down to 2280-99 area.

  43. Thanks TC. Happy Wed.

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