weekend update

REVIEW

The market started the week at SPX 2382. After a gap up opening on Monday the market continued to rally until it hit a new high at SPX 2419 on Thursday. After that there was a small pullback to end the week at SPX 2416. For the week the SPX/DOW gained 1.35%, and the NDX/NAZ gained 2.25%. Economic reports for the week were mostly negative. On the downtick: new/existing home sales, durable goods, consumer sentiment, the Q2 GDP estimate, plus weekly jobless claims rose. On the uptick: Q1 GDP and the WLEI. Next week’s reports will be highlighted by monthly payrolls and the FED’s beige book.

LONG TERM: uptrend

The updated count we have been using on the NAZ for a few weeks appears to be the correct one. So we updated the NDX charts to display the same Int. wave iii underway count. This coincides quite well with the SPX/DOW counts, that suggest Minor wave 5 of Int. wave iii is underway. As with nearly all fifth waves we have been observing negative divergences on their weekly charts. Will the market just ignore it, and keep going higher? Or after the short term patterns complete, will we see the largest correction since early 2016? Fourth waves (Int. iv) in recent years have been notoriously steep.

Long term the OEW SPX wave count continues too look correct. A Primary II low in early 2016, with Primary III underway. Intermediate waves i and ii ended in the spring of 2016, with Int. iii underway since then. Minor waves 1 and 2 ended in the fall of 2016, and Minor waves 3 and 4 ended in the spring of 2017. Minor wave 5, which completes Int. iii, has been underway since April.

For those still holding onto the Primary V count since 2009. They may get their opportunity soon, to find out if it is correct or not. We continue to carry this alternate count on the NYSE charts. Notice that this count suggests Int. v of Major 3 is currently underway. After it completes a Major 4 correction will follow. Then Major 5 should end Primary V. This is not our preferred count, but it is preferred by most Elliott Wavers.

MEDIUM TERM: uptrend

The Minor 5 uptrend, from the Minor 4 SPX 2329 low, finally broke through the SPX 2400-ish level this week. That level had kept the market in check since early-March. Minor 5 appears to be subdividing into five Minute waves: 2406-2353-2419 so far. With this rally we can now make some potential targets for the high of Intermediate wave iii.

While the market has now generated several higher OEW pivots, there are two sets of these pivots that are clustered together. Clustered pivots often offer far more resistance then standalone pivots. The first cluster is between the 2444 and 2456 pivots, the second between the 2524 and 2531 pivots. If the first doesn’t stop this uptrend, the second likely will. Medium term support is at the 2411 and 2385 pivots, with resistance at the 2428 and 2444 pivots.

SHORT TERM

From the downtrend low at SPX 2329 we counted 5 waves up to SPX 2406 on one timeframe, and 9 waves up on a shorter timeframe. Since both were impulse patterns we expected higher prices after a pullback. The pullback, however, was much larger than expected: 2406-2353. But the market rebounded quickly by making new all-time highs the following week. As a result we upgraded the labeling to SPX 2406 Minute i, SPX 2353 Minute ii, and SPX 2419 Minute iii so far.

Minute iii has been quite steady and strong, 66-points, and it has not had a notable pullback since it began. The strongest rally during Minute i was 53-points, during the 3 of 3 portion of that wave. This suggests one of two things: (1) Minute iii may not have a pullback until it ends, or (2) Minute iii will be quite strong with subdivisions of its own. Will leave both open as possibilities. Short term support is at the 2411 and 2385 pivots, with resistance at the 2428 and 2444 pivots. Short term momentum ended the week above neutral. Best to your trading!

FOREIGN MARKETS

Asian markets were all higher on thee week for a 1.4% gain.

European markets were mixed and ended mixed.

The DJ World index gained 0.9%, and the NYSE gained 0.8%.

COMMODITIES

Bonds are trying to uptrend but ended flat on the week.

Crude is trying to uptrend and gained 1.7% on the week.

Gold is also trying to uptrend and gained 1.2% on the week.

The USD remains in a downtrend but gained 0.2% on the week.

NEXT WEEK

Monday: holiday. Tuesday: personal income/spending and the CPI at 8:30, Case-Shiller at 9am, then consumer confidence at 10am. Wednesday: the Chicago PMI and pending home sales. Thursday: the ADP, weekly jobless claims, ISM, construction spending and auto sales. Friday: monthly payrolls and the trade deficit.

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

About tony caldaro

Investor
This entry was posted in weekend update and tagged , , , . Bookmark the permalink.

119 Responses to weekend update

  1. NEWBIE says:

    Banks selling off today ahead of wave c down.

  2. kvilia says:

    Speaking about impulse patterns 😉 Breathtaking markets today.

  3. phil1247 says:

    DOLLAR
    collapse continues…. bottom due FEB 2020

    looking more closely at gold now ……even tho….well you know…

    interesting that the 15 year cycle ..
    .. ( 5 time multiple of 3 yr cycle i showed)
    last peaked in feb 2002
    and looks to have peaked feb 2017 with the 3 yr

    so…………………. new mantra is….
    sell into any dollar rally
    buy gold on dips ….until 2020

    • mjtplayer says:

      Sorry Phil – couldn’t disagree more. For the Dollar to “collapse”, the Euro needs to skyrocket and be viewed as a safe haven – there’s no way that’s going to happen.

      The collapse is coming, but it will be the EU, not the Dollar. Until that happens, money flows to the US and out of Europe – bullish for the Dollar.

      See you at 120 in the .DXY over the next couple years, perhaps higher…

      • phil1247 says:

        euro is skyrocketing already.. in ext longs daily
        you have missed the train
        dollar in extension shorts daily… until that changes

        dollar collapse continues

  4. H D says:

    GM Tony, all. Hope you had a great Memorial Day weekend and got to enjoy some freedom. Frustrating to see a very clear 3 wave correction off 2352 fail at 2365 and turn into an impulse up. That has been common characteristic of this bull for years. Sticking it to the B wave sellers, me included, with Only 1 wave down. +55 from 2365 is 2420. Seems a little flag setting that potential up. Your 2411 pivot working.
    The bitcoin conversation got a little more crowded since we were talking about it April 2. Some related products up 500% since then :mrgreen:

  5. gary61b says:

    ES has room for a triangle.. a break above upper resistance then count continues.. a break below 2407 is a start with many support levels below.. if 2392 is reached a much more sinister drop is on the horizon.. IMHO.
    https://gyazo.com/6c4f05cf021013c1b36138d9d5022e66

  6. kvilia says:

    Well, C wave may not materialize if we don’t close down below 2408.

  7. NEWBIE says:

    The upcoming C wave is definitely gonna rip some heads off.

  8. GDX and gold down in spite of dollar weakness vs yen and euro.GDX at 10 d(22.78)and .09 away from breaking 20d (22.69).After last weeks action,that would be bad news.Avi still bullish on GDX over 20.88,thinks we go to over 31 during the summer.Later.

  9. vivelaamo says:

    Is it B or 3? Bears want B. Bulls want 3. I saw a moon yesterday so it might go up. But then half of it was covered by cloud so it might go down. Love this blog….

  10. torehund says:

    Brent to 49 usd in a swoosh ?

    • phil1247 says:

      Tore

      you still holding TBT?

      looks like bond cycle turn this week will be a high…
      i am selling bonds into this rally ….
      want to go short via TBT
      if TLT cant get thru target at 124.5

  11. fionamargaret says:

    Let’s see what Amateur-Investor suggests….and some Vivaldi..x

    http://www.amateur-investor.net/AII_Weekend_AnalysisMay_27_17.htm

  12. phil1247 says:

    https://invst.ly/40gfy

    BITCOIN.. ending diagonal……. time to exit
    thats why i sold.. ..
    didnt even know new moon was the peak till chris pointed it out

    charts rule…
    thats all you need to know ..
    . conspiracies and logic are pathways to bankruptcy

  13. pooch77 says:

    Do futures trade all day?Thought they close 9am Central

    A

    • Main markets only close on Friday night to Sunday afternoon. Others keep more or less the local market time open and are closed when they close. But there may be differences depending on different providers?

  14. phil1247 says:

    mentioned previously i thought NEW moon was top time ….
    chris carolan .. points this out

    • phil1247 says:

      one more from chris….

      • phil1247 says:

        Chris Carolan‏
        @spiralcal

        Follow
        More
        Tulips didn’t decline sharply in 1637. They just stopped trading. Not a small exit door, rather it was no door at all.

        • tony caldaro says:

          Tulips stopped trading because everyone had bought
          When no new buyers showed up at auctions prices started to decline
          Buying begets buying, and selling begets selling

          • phil1247 says:

            the ending diagonal near 2800
            was a nice clue that a big drop was coming
            exited close to top and watched all the downside fun from the sidelines

            public service announcement…..
            i would not be holding GBTC overnite…
            it could vaporize into the ETHER

          • torehund says:

            Collectivie psychosis is a strange phenomenon, reasoning unhinged but it makes sense anyway. Could be impeachment, walking on water, a black tulip or bitcoins. We are entering such a phase on a grand scale, lets play😜

    • Has anyone ever seen anything like this?If the S&P had gone from 900 to 2800 in a month,or vice versa…
      ANYTHING that triples in a month–no matter the explanation of “why”–is slightly overbought.The moon’s effect on assets(new and full)are just patterns–like January effects,half year cycles in gold,OPEX week.Sometimes they rally,sometimes they don’t.It’s better to wait for a couple bull (or bear)reactions–and then go with the opposite of the last two.Pretty much a coin flip.

    • Just to settle this controversy–though some people can’t believe something you put right in front of their eyes–I made the effort to mark (with vertical red lines) the new moons on the Spx for about the last year or so. You can look for yourself and see whether new moons are more up or down days or nearer to (local) tops or bottoms.
      Spx daily futures –
      http://imgur.com/a/TwGmI

    • See my comment below with chart on NEW MOONS!

        • Can’t access it on my tablet.Someone else posted a moon chart recently.(123abc?)As I remember it,nothing to put money on.

          • That’s right, nothing conclusive by considering the new and full moons ALONE. You have to consider a lot other cycles in addition. Unfortunately I cannot reveal more of this system, which I spent years (and a lot of my health) investigating. But anyone who spends the time to analyse them will see that there is a regular, though not exact, cyclic pattern. One tip: this is surprisingly based on the calendar days. 0bviously it is founded in the PSYCHOLOGY of the participants. E.g., everyone feels the difference between the beginning and the end of the month. (That’s just an analogy.)
            Though I cannot reveal the system, I will often mention special bottoms (tops are very difficult to time) in my comments.

            • phil1247 says:

              chris carolyn goes into detail about that with the spiral calendar

              here is a taste from chris

              http://spiralcalendar.com/chapter-1-a-detective-story/

            • Anyway, LUNA-tic (luna = Moon, gr.) values like BITCOIN probably have a natural affinity for the NEW MOON! And two “coincidences” are weak “proof” for a supposedly general principle.

            • It is, however, very interesting if, as it seems, the great market crashes investigated by Carolan began also on new moon. There is a phenomenon known by “cycle watchers” as “cycle inversion”, in which occasionally the normal cyclic bottom will be the top. Could it be that such major crashes involve a cyclic inversion? Have to look into that myself!
              But as you can see by looking at the chart I posted above, there is not a single new moon in that almost two year period which is also a (local or major) cycle top. As I said above, the TOPS are anyway extremely difficult, if not impossible, to predict by cyclic research. (IMO) Therefore THIS discussion seems rather irrelevant; unless it really is the inverse cycles that are the devilish ones.

  15. anyone notice that the es order book is no longer the same? before prior to opening you had orders bunched up around where the opening would be indicated..now u have numbers on both sides that make no sense .. furthermore even during actual trading the book seems diff.. anyone notice this and have an explanation?

  16. 7dayyss says:

    Tony, hope you’re enjoying the holiday weekend. Don’t forget to grill out a nice ribeye for yourself tomorrow! Thanks for sharing your opinions.

  17. J.Wenger says:

    One quote remains top of mind from the 10th Man Newsletter: “Bull market dude”
    http://www.invest-safely.com/stock-market-outlook-2017-05-28.html

  18. Across Twitter today, many of the investment analysts I follow brought attention to the fact that after seven days of consecutive increases the tendency of the market following these gains has been to continue the trend over the next days though at a very subdued pace. Quoting Urban Meyer:

    “Notably, SPX has now risen 7 days in a row. In the past 5 years, this has occurred only 5 other times, 4 of which were during the 2013 boom. In all 5 instances, SPX closed higher again within the next 5 days by a median of 0.7%. By Day 5, SPX was higher 4 of the 5 times.

    For a larger sample size, consider the strong performance after SPX has risen 6 days in a row. SPX closed higher either 10 or 20 days later in 9 of 10 instances since 2012. Risk/reward (defined as max gain versus max loss) during the next 10 days and the next 20 days was 6 times. Clearly, trend persistence overwhelmingly led to further gains and favorable risk/reward (table from Twillo using data from indexindicators.com). Enlarge any chart by clicking on it.”

    http://fat-pitch.blogspot.com/2017/05/weekly-market-summary_28.html

    When you look at the data for six days of consecutive increases, the general tendency is consolidation for around three trading days before the market moves on to complete the historical pattern of a median increase of .7% within five trading days. And historically, the increases after ten or twenty days are only marginally higher than the gain after five days, suggesting that Minute iii may end with a grind.

    Interestingly, Raymond James (courtesy of Fiona) in their Morning Tack for May 26 echoes this by saying “the next few sessions could be a grind with momentum fading”

  19. alexh110 says:

    Isn’t it this week Comey is due to testify before the Senate committee?
    Is this likely to weigh on the markets?

  20. bouraq says:

    Chart of the weekend is $OIL at http://www.tradingchannels.uk

  21. Hi,Thanks Tony
    Looks like the DOW is in a ascending triangle formation,which supposed target would be next expansion fibo
    https://invst.ly/409oc

  22. taskara says:

    Forgive me if it is a lame question but why 2011 was not quantified as bear market

  23. cj32 says:

    • mjtplayer says:

      Coolbiz – I’m still tracking the GDX bear wedge, where wave “E” can still get up to the $24 area. Gold could rally in the coming days/weeks, but the next turn window for gold is late June, whichever way gold moves in the coming weeks into that turn window the real move is afterwards in the opposite direction.

      I was hoping gold would tank into the turn window and mark an important low, but if gold rallies into the turn window it should mark the end of the bounce and gold resumes it’s bear market thereafter.

      Miners are weaker than gold, which is bearish. Both are trading inside triangles and wedges, which are consolidation and continuation patterns. The trend is down for both, longer term.

      https://www.tradingview.com/x/Vkl6ZXa4/

  24. Jack Sparrow says:

    Tony as per your count, the primary third would be quite shorter (alteast it seems that way at present)…compared with the first wave. any thoughts
    thanks

  25. taskara says:

    Tony, great stuff as always.
    one question. What is the reason for this primary 3 in progress count to be your preferred count? Why not primary 5 Is?

    • tony caldaro says:

      OEW quantified a completed bull market from 2009-2015.
      Bear market 2015-2016.
      Now new bull market 2016-xxxx
      Since 2011 was not quantified as a bear market, the count is P3 underway

      • taskara says:

        Forgive me if it is a lame question but why 2011 was not quantified as bear market?

  26. jhjoyner says:

    Hopefully Int iii will take 3-5 more weeks to complete.

  27. captbara says:

    For earlier reference. Looks like it’s a pretty reliable indicator

  28. Thanks Tony. Enjoy the long weekend.

  29. Arthur Knopf says:

    SENTIMENT UPDATE: Consolidation, then What
    http://sentimentsignals.blogspot.com/

  30. allen kimble says:

    One could make a case that the consolidation from March to mid May was a ascending triangle with a target of 2483. Would not be shocked if it hits that number by end of June.

    Anybody who bought the obvious gap fill(weekly and daily)just 8 trading days ago, is sitting nice right now. Ultimately over 2500 by August 1st is where this is heading. Then IV will happen. With QE out of the way and with a bubble forming on the indices, this is an excellent time to trade with very limited downside if one just follows the waves, that are forming in perfection, without any intervention by outside forces. These are the times when technical analysis will work.

    Don’t be caught thinking the market is overvalued. This is the time when things will be the most exciting and profitable.

    .

  31. phil1247 says:

    https://s.tradingview.com/x/i2DzzG9o/

    BITCOIN…..

    phil1247 says:
    May 25, 2017 at 12:52 pm
    phil1247 says:
    May 25, 2017 at 10:20 am
    bitcoin looks like ending diagonal

    looking for fast drop now

    this was posted within minutes of the 2800 dollar level thursday
    … decline so far about 900 dollars ……
    was that fast enough ??? 😉

  32. phil1247 says:

    http://tos.mx/tosmx/item?id=559moW&image

    /GC …

    shorts beware ………… target 1339…. still..
    LEE X..
    it sure was a cheap long… hope you took it !

    phil1247 says:
    May 12, 2017 at 7:17 am
    /GC

    GOLD…. interesting development……..shorts beware
    bullish above 1220

    target 1338………….as long as 1220 holds

    Lee X says:
    May 12, 2017 at 8:56 am
    That sir by definition is a cheap long
    Good luck guys !

  33. blackjak100 says:

    If this is Minute B, it needs to top Tues below 2430 with a below range close followed by a decent down day Wed. Tues would make Minute A & B equal in time. MACD gave a daily buy signal on Thurs. Longer it stays intact, the more relevant it becomes.

    minute A = 31 days
    minute B = 31 days on Tues

    • Richard Glackin says:

      Check. Internal count says one more high to go to complete the ‘B’ wave.

  34. torehund says:

    Happy weekend, Tony and the gang !
    Nothing to add as the bull is doing as expected. Trump is shaking and squeezing handshaking, so let the market follow. Rake off the bureaucracy and Nato is a beginning, we dont need non-contributing eaters at a time when state finances are BAD all over the world. Peace 🙂

  35. Thanks Tony for your always helpful insight. I have little to add to what has already been said other than saying the the advance of Minute iii could continue through the mid-June Fed meeting at which time there may be a temptation to “sell the news after buying the rumor”, particularly should the Fed increase rates after releasing what could be best described as a highly conditional statement last week. But any selling following the Fed meeting would likely be short lived as 10yr yields are more tightly correlated with inflation expectations and flights to safety than increases in the federal funds rate. The flip side to this coin is that any decision not to increase rates could simply fuel the fire. My work, which closely follows Tony”s, suggests the 2425 to 2432 area may be the first real challenge for the market since it cleared 2411.

    • bfquant says:

      ABC.. That is quite a primary fifth you have us in. But I completely agree with the 1-2 , 1-2 that started it off. It has the exact right look

  36. William Vohs says:

    Cosmetics in china.! Oriflame (ORI) Mid Cap Stockholm
    Started Selling in China. Going very well.
    Lots of upside hopefully!!

  37. Meanwhile,cabbies become extinct,factory workers disappear,retail stores obsolete.We’ll even have robotic kiosks at McDonalds,Olive Garden (waitresses gone).Ahh but the good news…President Zuckerberg will give monthly income checks to all–and if everyone puts that money in the stock market,the Bull can go on forever.In the eyes of business,it’s Nirvana.Government as well.The people relying on a (Democratic party) government for everything,because the business world discarded them.Zuckerberg/Winfrey in 2020…lol.The beginning of the end of society as we know it.And on that note…Good morning!!!(and enjoy the weekend).

    • tommyboys says:

      Learned its called creative destruction. Is occuring and has ALWAYS occured. It’s how progress unfolds. We live better today than kings did just a couple centuries ago. Necessary and welcome.

      • Past performance is no indication of future results.At some point SHTF because the work ethic has been eliminated for many,though software guys will thrive…and a few trillionaires like Bezos and the like.when you’re young with nothing to do,bad things usually happen out of boredom.My two BitCons for the day.

  38. fotis2 says:

    I like Trump his country and its people come no.1 need more like him around not the parasitical entities plaguing world politics.No.1 on my list is Duterte of the Philipines..

    http://www.dailymail.co.uk/news/article-4547434/Trump-charm-snarls-climate-change-migrants-trade.html

  39. William Vohs says:

    Gold monthly if that HS plays out target 987
    Then take Place,sit back,enjoy the ride.
    prim target 1597. sec target 2584
    All of them fib sequence numbers

  40. tony caldaro says:

    surges in productivity and growth are driven by technology
    railroads, autos, computers, etc.
    agree

  41. Great stuff Tony I am now in total agreement on your long term count I think the adoption of EV vehicles and autunomous transport etc should lead to a huge productivity boost to GDP over the next 10 years and depress the oil price. Go Tesla. Musk is doing some great stuff.

    • Tim M says:

      over the next 10 years? it will take more than 10 years before you see autonomous transport in society.

      We already have autonomous (robotics) used extensively throughout our economy. The concept of applying artificial intelligence (AI) to these technologies is where the potential is. I’m not sure it will happen as quickly as people think. I remember microsoft set out to develop a reliable way to dictate speech into microsoft word. That was over 20 years ago, I still can’t get siri to understand what I say half the time.

      • Elon Musk in a recent video update whilst who is somewhat optomistic but very credibile said 2 years for the first autunomous car release. Time will tell.

Comments are closed.