Thursday update

SHORT TERM: higher open in sideways session, DOW +6

Overnight Asian markets gained 0.1%. Europe opened lower and lost 0.4%. US index futures were higher overnight. At 8:30 weekly jobless claims were reported higher: 257k v 243k, and durable goods were reported lower: 0.7% v 2.3%. The market opened 2 points above yesterday’s SPX 2387 close, then moved up to 2391 just past 10am. At 10am pending home sales were reported lower: -0.8% v 5.5%. Around noon the SPX hit 2383 and then started to rally. By 1pm the SPX hit 2392, then dipped to close at 2389.

For the day the SPX/DOW gained 0.05%, and the NDX/NAZ gained 0.45%. Bonds added 3 ticks, Crude lost 40 cents, Gold dropped $5, and the USD was higher. Medium term support remains at the 2385 and 2336 pivots, with resistance at the 2411 and 2428 pivots. Tomorrow: Q1 GDP (est. 0.9%) at 8:30, the Chicago PMI at 9:45, then consumer sentiment at 10am.

The market opened higher today, hit SPX 2391, dipped to 2383, then hit 2392, before settling at 2389. Tech stocks were bid up ahead of after hours earnings. Cyclicals stayed in a trading range ahead of tomorrow’s Q1 GDP report. No change on the count: three waves up from SPX 2329 to 2398. Can be a 1-2-3 or an a-b-c. The recent SPX 2398-2383 pullback is notable, but thus far not significant. Interesting bifurcation between the cyclicals and the techs continues. Short term support remains at the 2385 pivot and SPX 2369, with resistance at SPX 2401 and the 2411 pivot. Short term momentum hit oversold today at the low then drifted up. Best to your trading!

MEDIUM TERM: close to confirming an uptrend

LONG TERM: uptrend

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

About tony caldaro

Investor
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81 Responses to Thursday update

  1. Richard Glackin says:

    Just after market close, the ES showed a higher complex ‘abc’…most likely the retrace following wave 1 down. Monday should be very interesting.

  2. Richard Glackin says:

    Since it is after hours, here is a little education in silver for anyone interested. Most, especially the experts, are projecting that silver will outperform most commodities and equities over the next two to three years. The timing is difficult to forecast but 2 to 3 years is a good guess. Now, some of the “experts” who are silver bugs, forecast that once silver bottomed, it would take off like a rocket. Being a little skeptical, I looked back over the history of silver and found that silver has NEVER taken off like a rocket. On the contrary, its behavior has always been a very slow start followed by a gradual acceleration. In fact, the acceleration is greatest near the peak and, once it peaks, it drops like a rock. It is very easy for you to go back in time and check that for yourself.

    There are two points I’d like to make regarding the characteristics of silver. One, because of the slow start inherent to silver, many traders lost their you-know-what as, even LEAPS or long term options expired long before silver would take off. The second point is that since any peak in silver (which looks more like a knife blade) has highest acceleration near the peak AND then drops like a rock…you do not want to be holding silver at the peak. In other words, in an ideal world you would want to sell just before the peak. That goes for both hard assets as well as ETF’s and stocks.

    This brings up another point. The silver ETF ‘SLV’ has a very unique relationship with the largest silver stock ‘SLW’ or, Silver Wheaton. SLW is always higher priced than SLV with the single exception of whenever silver hits a major bottom. Near bottoms, SLW drops 2 to 3 dollars below the price of SLV. At this point in time, you may call that ‘trivia’ but it is definitely a way to know when silver bottoms.

    I bring up silver at this point in time because opportunity is about to come calling. Here’s the picture:

    Since Silver bottomed at $13.62 back on 12/13/2015,
    Wave 1 peaked at 21.207 on 7/3/2016.
    Wave 2 bottomed at 15.755 on 12/19/2016.

    Since then, silver has been working on wave 3. Remember, slow start – then accelerate.

    Now, we’ve had what appears to be (at first) a 1-2, 1-2. However, with the second ‘1’ being higher than the first and with it’s retrace being very deep AND continuing, we now have a different scenario – possibly… this is something to watch for. If, the current retrace drops below the prior retrace then, we have the distinct probability that wave 1 of 3 is an ‘abc’. In that case, the forecast is for a diagonal up for silver. I point this out because trading diagonals is a little easier because we will know the boundaries. 🙂

    In addition, the internal wave structure of the current retrace indicates that silver has not even finished the 3 of ‘C’. Since we have already exceeded the 1.618 it is therefore possible and even likely that this retrace will drop below the prior retrace. If that occurs, then wave 1 of 3 will be a single ‘abc’ up followed by an ‘abc’ retrace instead of a couple of 1-2’s. Consequently, run your fib retrace from the wave 2 bottom (15.755) to the last peak at 18.65. Again, that’s IF the current retrace drops below the prior retrace. Otherwise, it’s just a 1-2, 1-2. Currently, with silver at 17.371, when your do that, we are approaching a 50% retrace – not far exceeding a .618 retrace! Of course this could still get to a .618 retrace!
    – 50.0% would be about 17.16
    – 61.8% would be about 16.81

    Furthermore, since EW can forecast direction and magnitude of moves (via Fibonacci) but NOT TIMING, I have a “non-option option” you might want to consider. Options are always high risk because of timing…even long term options (while they may not expire on you) the decay over time kills your profits. USLV is a leveraged ETF and, as such won’t expire and, like most ETF’s does have some decay but it is miniscule compared to options. I believe you’ll find it will run up about 2 1/2 times faster that SLV. Just remember, this is NOT trading advice, just something for you to evaluate for yourself.

    • fionamargaret says:

      Richard this is really interesting stuff.
      I didn’t know you if you or Stephen were still around this afternoon – I wanted you to take the other side on “if there is conflict will oil go up”….would it? Presumably business would falter, making oil decrease….and yes, depends where the conflict is situated….

      • Richard Glackin says:

        Thanks fiona. Frankly, I haven’t given the conflict/oil price a lot of thought…but I will. Incidentally, I am mostly in the camp that most ‘news’ stuff has very little impact on the waves…hence the market movement. HOWEVER, and this is a big however, I am not one of those extremists who say that the news never impacts the market…after all, some news impacts sentiment and it is sentiment that drives the waves. So, when we talk about conflict vs oil price, I tread cautiously. In other words, some events will move price while others will not. More on this later.

        • fionamargaret says:

          The chart suggests lower oil to about 41, but I suggested buying oil today ..lightly touching on conflagration…interested to read your thoughts. I also suggested gold and treasuries.
          Why isn’t Kim invited to Mar-el Lago for the weekend…

        • Thank you very much, Richard.

    • aahmichael says:

      Seems to me that if a person wanted “leverage” and wasn’t going to use the futures market, then a much more efficient way to play silver would be to buy shares of SLW outright. That way there is no decay risk.

  3. Lee X says:

    Hey Tony

    Since it’s a slow day here thought you’d enjoy this.
    Heard yesterday that Mr Tullis is considered to be legally blind now and was so effected by his sight that he was only able to shoot par on his most recent B Day which I think is either 90 or real close to it .

    :>)

  4. blackjak100 says:

    The 2 most acceptable counts still require 5 waves up. If you’re in the triangle camp, there is absolutely not 5 waves up from 2335. If you’re in the B camp, there is not 5 waves up from 2329. I still believe a HH above 2398 is in the cards before a reversal. however, would need 2377ish to hold.

  5. H D says:

    Slowest GDP Q1 in how many years? Where’s the growth?
    Some profit taking today, potential for C=A 2377 Range 2,383.43 – 2,393.68
    Have a good weekend all.

    • Page says:

      growth? Trump has a plan, he was pretty busy last 100 days, he will start on growth next week.

      • tommyboys says:

        Find it interesting that the big opposition to tax cuts and smaller government – the folks screaming “debt and deficits” comes from the very people that love to spend and grow the debt. Now we have Obummer accepting HUGE paydays from the very banks/wallstreet that he campaigned against for a decade years. What’s next will he start clear curing national forests to sell the lumber? Talk about hypocrisy. Public servants should be precluded from enriching themselves FOREVER off of any “public SERVICE” positions. Is it service for the betterment of the country or a just career path for financial gain? Topsy turvy world we live in being chronically lied to from all ends.

    • SPYtrader says:

      ask Obama. He is doing very well in todays economy.

  6. phil1247 says:

    http://tos.mx/5PNsmq?image

    DOW
    /YM trading more technically than /ES

    beautiful bounce off ext long .50 level
    out of all stock long positions since yesterday on spike up to .618 resistance /es
    no interest in shorting until extension long on /YM fails

  7. Stuff to watch:
    DJT down 71 to 9122.
    VIX to 10.60–.58 away from a buy signal.
    GDX unbelievably bouncing,as the 18d EMA bearishly crosses the 100d–just like in March.If the pattern continues,back to 23.20.a break through that would be bullish.A reversal there,just as likely or more so.Keeping objective about it (sorry Mr C for stealing that word)..
    Nasdaq only up 3 points?Russell down .75% Hmmm.
    Later.

  8. asaraniti says:

    FYI and per DH …./ES coming back down to test the 50% retrace for the weeks activity. Yesterday, /ES bounced off this level. However, today $BANK is still declining signalling if there is a rally don’t trust it?

  9. Richard Glackin says:

    Someone has a lot confidence…they bought 2,930 June 16th $13 Call contracts for $0.40 (bargain price). That’s 293,000 shares worth or, $117,200 worth. Same vehicle I’m using to short the market.

  10. torehund says:

    Btk doesnt seem to want giving Away the large gap, could be ready for some serious upside action, good weeken Tony and all. Good vibes on the blog🌞

  11. Bud Fox says:

    Hello…and Good Morning. I am merely sharing my view.
    From what I have read, really good stuff — but — I am not as
    Bullish, as many of you. No, I am not short the SP, either.
    Why? I can see a price gap of 10 points on the OEW, SP 60
    min chart – 2360-2370….I do not like gaps. Thus, I am not
    quite as Bullish, as some are…let’s see how my cautions works
    out over net few days……

  12. jhjoyner says:

    Nasdaq, RK2 at ATH
    Spx 0.3 % away
    Dj-30 0.6 % away
    NYSE 0.7% away.
    Just a matter of time and all major indexes will be at ATH.

  13. mcgcapital says:

    Shorts looking good and sterling continuing its bullish breakout. Just waiting for the SPX to roll over then it should really get going.

  14. If this market continues to refuse to go down, it will, before too long, go up.

  15. Richard Glackin says:

    We have a very clear Head and Shoulders in the ES that is hardly noticeable in the SPX. Now, granted, H&S patterns are not the most reliable. Nevertheless, if this one pans out, the target is right about 2369. Well now, heaven’s to mergatroid, if that isn’t Tony’s lower support pivot. 🙂

    Also, please note whether you are in the ‘abc’ continuing wave 4 camp or the wave 5 camp, the jury is still out. This could still go either way. As Tony mentioned, “Can be a 1-2-3 or an a-b-c.”

    And, for the record, depending on wave structure, when we get to 2369 ish, I am likely to sell my short options and wait to see what Mr. Market wants to do.

    • cyanus66 says:

      The H&S in the ES would conveniently backtest the DT line at 23069ish that joins all the March-April peaks, so that may work, although it’s too obvious and this market has proven it despises Mr. Bearish-obvious.

      Now if this H&S morphed into a diamond continuation and targetted the 2420s … better do the wait-n-see thing now, imho.

      • Richard Glackin says:

        cyanus, after the recent rally, the market had to pull back, even if its destined to go up. this was a no-brainer.

  16. Just got done watching the Ira daily wrap.He thinks V I X above 11.08 will signify a bear trap and possibly signal a stock selloff of some kind.He also thought,at the time of the taping of the video(530pm),that the earnings coming out would lead to a huge futures gain for Nasdaq.The earnings were that good,he thought.But at this hour–slightly red.
    Dollar could embed to the downside (3rd day today).Gold COULD correct to 1240,but he still likes gold on the weekly chart.
    Trump said,”NK is headed for a major conflict.”Game of chicken?
    Good night all.

    • I wonder if Yellen is aware of this correlation…lol.

      • fionamargaret says:

        How was the win/lose study….I hope it was the former…

        • Haven’t looked into it yet this year,Fiona.I had to think about your question for half a second.That was already 2 days ago..lol.But I’ll post some results when I get around to it.Ttyl.

          • fionamargaret says:

            It interests me…patterns and all that. I thought you went to study today…….

            • Just the casino.I usually wait for the first month of the baseball season to writing down the results on paper.Then I can see the patterns better.There are patterns within patterns (I’m sure you know that),but I try to keep it as simple as possible.I noticed Washington won 7 in a row,lost and now won 3 in a row.The next team that wins 7 in a row should not win more than 2 in a row after that.Should is the operative word.Some years work better than others.

              • take 2:
                I usually wait for the first month of the baseball season to get done before I start writing down the results…etc.Hope that makes more sense.I’m writing with one eye open…lol.

              • fionamargaret says:

                Good stuff L… I was trying to be obtuse about asking about the casino…keep safe.x

  17. 2405-2410 next place for a good short

  18. torehund says:

    Might wait until Monday, but let the market..

  19. bouraq says:

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

  20. joecthetruthteller says:

    Results of the Long Terms Turn Date on March 20, 2017

  21. Thanks Tony. Something worth watching: USD/JPY https://invst.ly/3u9p2 It’s one of my measures of risk on along with the relative performance of small caps, HYG and XLY. Along with a couple of others.

  22. Apple earnings 5/02 with a probable monster -div on the weekly…maybe a turning point for Nasdaq?

  23. bfquant says:

    it has the feel of a pop-and-drop tomorrow. the market, that is, led by a reversal in tech. no systematic reason for this. just feel.

  24. kingfrogcash says:

    $AMZN and $GOOG big beats. $MSFT not so much. Enough to take SPX to new highs?

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