Tuesday update

SHORT TERM: quiet open, pullback, rebound, DOW +1

Overnight the Asian markets gained 0.7%. Europe opened higher but lost 0.4%. US index futures were relatively flat overnight, and the market opened one point below yesterday’s SPX 2427 close. In the opening minutes the market dipped to SPX 2423 then tried to rally. At 10am wholesale inventories were reported higher. At 10:30 the SPX hit 2428, then dropped to 2413 by 11:30. Then it rallied. Around 3:30 the SPX hit 2429, then dipped to close at 2426.

For the day the SPX/DOW were mixed, and the NDX/NAZ gained 0.25%. Bonds added 5 ticks, Crude rose 65 cents, Gold added $2, and the USD was lower. Medium term support remains at the 2411 and 2385 pivots, with resistance at the 2428 and 2444 pivots. Tomorrow: FED chair Yellen testifies before Congress on the economy, and the FED’s beige book at 2pm.

The market opened relatively unchanged today, bounced around neutral for an hour, dropped to SPX 2413, then rallied right back to the high (2429) of the day. While this downtrend still has declining highs: 2450-2443-2439-2432, it also has a couple of rising lows: 2406-2408-2413. It seems a bit odd, for a downtrend, that the two recent declines over the past 1 1/2 weeks have not broken the SPX 2406 low. Resilient market. And the DOW still has not confirmed a downtrend. As noted yesterday, if the recent high at SPX 2432 is broken then it possible the market is trying to gather momentum to the upside. Until that occurs we are still looking for lower lows. Short term support remains at the 2411 and 2385 pivots, with resistance at the 2428 and 2444 pivots. Short term momentum ended the day around neutral. Best to your trading!

MEDIUM TERM: downtrend

LONG TERM: uptrend

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

About tony caldaro

Investor
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151 Responses to Tuesday update

  1. Page says:

    Thanks Janet Yellen.

  2. fotis2 says:

    Shorts on the cheap NAZ perfect down channel for 5500s get your now and avoid the rush.

    https://invst.ly/4chel

  3. stockop says:

    thoughts on TLT moving up to finish wave 5 of an ending diagonal of C? this would make wave 2 a flat. lot of potential options right now… simple zigzag for an already finished w2? (don’t like this from a time standpoint) or if it does indeed do a 5th up is it a leading diag for A of w2?

  4. gary61b says:

    RSI should be oversold with price at its highs by end of day, lol…worthless indicator…

    • tommyboys says:

      Not worthless, just the signature of a bull. Strength rewinds while price holds steady. This is the indication to buy at the next the next RSI low…beautiful.

  5. captbara says:

    NQ falling wedge (clean ED of C) and backtest move from last week still playing out beautifully. Love those setups.

    • stcoleridge says:

      Do you have a target ?

      • captbara says:

        I don’t do targets but this impulse from the lows doesn’t look complete yet.

        My super bullish assumption is that we are subdividing this 5th of 3rd. In that case just keep stacking if you got good a entry. My more measured assumption is we’ll do some expanded flat or triangle for the next few mos and hello trading range once again.

  6. Bud Fox says:

    Silver is looking for a lower low ? anyone….

  7. Page says:

    There is very good chance market will reverse sometimes tomorrow and give back today’s gains.

  8. cmucha68 says:

    as we have hit your pivot what options do you have in mind, or will you cover it in your updat later Tony ?

    Thanks !

  9. Still possible that today finished an e wave up to complete B. 2436 was the top of channel, so a little overthrow to catch the bulls . Will see, today’s close will important.
    Good luck all

  10. purplember says:

    anyone find it odd that FED was all QE / lowering rates well beyond when they said they’d stop at 6.5% unemployment with Obama. Trump gets in office and now rates going up and reversing QE by taking liquidity out of the market.

    HHmmmmm

    • stockop says:

      i think that has more to do with Trump getting into office near the potential end of a business cycle. economy always looks the best at the top

    • Nonsense. Federal Reserve Bank actions have zero to do with King Orangutan, they are most likely pre-positioning actions to be able to do something in the event of a recession. Right now, with rates near zero and a fat balance sheet, they have no bullets in the gun, they will have no tools to help prop up the economy in a slowdown. It’s not political.

      And it’s Fed, not FED. If you want to use an acronym, then use FRB.

  11. scottycj1 says:

    Buy Stop paper cleaned out of the gold market. Awaiting a close below 1200 to trigger trap door. Sell your doubloons mateys ….stocks are going higher.

    Good luck

  12. vivelaamo says:

    Tony’s pivot 😍

    There’s my 3.

  13. stockop says:

    lot of back-patting going on…

  14. vipulm555 says:

    Over the years any Emiotional post for out cry for top has been dispair , all the heard follower lost money and my bank is happy as usual.

    Weekend post are great, great read, but does nothing to bank in short run.

    We all know it’s bull market , why drive -ve sentiment ?

  15. pooch77 says:

    Sold my shorts an hour before open and went long to avoid slaughter,see ya all tomorrow

  16. vivelaamo says:

    Told you that hammer close always seems to produce a rally next day. Lets see if this a genuine breakout or a bear trap. Good luck all.

  17. cj32 says:

    • mjtplayer says:

      Yes, gold held the $1,200 support area, looks like a rally to test resistance around $1,240

      GDX held $21, could rally to $23

    • scottycj1 says:

      Buy Stop paper cleaned out of the gold market. Awaiting a close below 1200 to trigger trap door. Sell your doubloons mateys ….stocks are going higher.

  18. pooch77 says:

    So with turndate today after this ungodly weak pullback and bank earnings next 2 days we should hit new highs by Friday close

  19. Gold and SPX up decently the same day?What did she do? Must be a Fat Yellen finger(or elbow)on both of them?The only explanation.

  20. pooch77 says:

    Looks to be straight up until eom,threw in the pullback towel

  21. scottycj1 says:

    GC from 1204 A—B a b C 1225 resistance

  22. cmucha68 says:

    Gtoptions: I guess your 2380 target in 2 days will be very hard to reach.

  23. cmucha68 says:

    Tony, do you have alternative options or do you still hold on tight to the P4 A down scenario ?
    Thanks !

  24. thoth8 says:

    Emin Agalarov is not only a “Pop Singer”! But mos of all he is a son in law of President of Azerbaijan, who is a KGB guy just like Putin!
    His father is the biggest Russian Oligarch.

    The ugly Godzillas are all connected just like the previous President of USA! It is a basically the Godzilla’s Club!

    • tony caldaro says:

      Since when is talking to family friends collusion?

      • H D says:

        “Family friends?” That’s a big 180 from having ZERO contact w Russia. In fact, conspiring and lying to deceive America for over a year is the very definition of collusion.

        The facts coming out don’t raise any red flags for you Tony?

        • tony caldaro says:

          This nonsense goes on in every election.
          Each candidate trying to get the edge on the other.
          No laws broken, nothing to see, the market was impressed for all of 30 minutes.

          • EL MATADOR says:

            +1 Tony…..further more, IMO, the Mr Market has been making it very clear that the Trump-russia thingy is just noise……Just listen to the musical chairs, there is nothing there, so we continue to moving along

          • H D says:

            *every election ? Guess when it comes down to Country over party and especially Russia I’m just more conservative than you guys.

            Mat- hasn’t the market shrugged off everything in the past 8+ years as noise?

            Добрый день

            • EL MATADOR says:

              That’s a question that has two parts; one part yes and one part no pending on each individual event. Money is always flowing hence trying to tell us if what starts as a rumor is noise or not….e.g. compare the markets money flows during Nixon’s impeachment vs Clinton’s vs Trump’s…..the money flowing during Nixon’s time was very telling that there was a smoking gun….but during Clinton’s time money flows were telling us it was all noise….now look at money flow’s today, thus far money flow is believe’s it’s all noise.

  25. cj32 says:

    Cr. to CBZ

  26. Richard Glackin says:

    For days now, the prevailing count hasn’t been cutting for me. I hate to sound contradictory but I have to express this point of view. Does anyone else besides soulsurfer and me think that we never finished wave 5? My take is that the market “snuck in” an extra wave 3 such that the drop from 2451.50ES to 2402.25ES was a wave 4 and we are now on our way to complete wave 5…at the original target area of 2480ish. THEN, we get the bigger drop.

  27. Bud Fox says:

    ref VRA….appreciate comments on VRA, from an investment position.
    Stock has moved from 30 to under 10….I am on the fence with this one.
    Does look interesting, trade/investment…

  28. UPDATE: Markets aready slowly breaking upwards. Today should be a “trending” day!
    spx futures hourly –
    http://imgur.com/a/FKK8g

  29. vipulm555 says:

    MACD cross , momentum up

  30. jobjas says:

    SPX projection

    • fionamargaret says:

      Yesterday I suggested, using Tony’s lower high sequence, the next number would be 2428 (it was 2429). If we again take his sequence, the number for today should be 2421.
      With the higher low, there is a bit of a dilemma, as there is not enough information with only 3 numbers to provide accurate information……I could suggest 2415/2418.

      Cohn is being suggested to replace Yellen, Canada is going to raise rates, and they are still musing about oil…
      I think commodities might be a good buy…they are cheap….xx

      • Jeffery has been smoking a little too much weed. The low point of the 1981-82 bear market was Aug 12, 1982 at a DJIA price of 776.92. The 1982-87 or 1982-2000 bull market did not begin in Nov 1982 when the DJIA made new all-time highs above 1053, but at the low point of Aug 12, 1982. Thus his analogy with 2009 and 2013 is fundamentally flawed. This bull market began in March of 2009, not in 2013. That is not to imply that Tony’s way of delineating bull and bear markets is incorrect, but Jeffrey is not using Tony’s method. He is using conventional metrics but is doing it wrong.
        I am a bull like Jeffrey, but you can’t just change history to justify your position.

        • fionamargaret says:

          George, why don’t you drop Jeffrey an e-mail. He is the nicest of people and would probably love to hear from you. The market is his passion.

      • Bud Fox says:

        say…that go for Gold/Silver as well ????
        since your Bullish on the oils…

        • fionamargaret says:

          Bud I really like the golds….read my stuff from a couple of days back….JNUG and NUGT.
          The oils I am not so keen on…they are still producing more than is necessary. The truth about the oil producers is mentioned in Saudi and in Europe, not so much here., but the IPO of SaudiAramco is muddying the waters some.
          I think oil has to correct to 41 or so, and then I would buy.
          The commodity index funds look bullish to me…such as DBC…
          Take care…x

  31. stormchaser80llc says:

    Not much changed since yesterday. Money trying to find a new home in small caps and technology as well as Oil. Markets themselves are damaged but not done in for yet.

    Yet another SPX Hindenburg Omen, 4 in a row, and 7 since its All Time Highs. Lots of selling going on underneath the currents. SPX had very low volume again today, remaining below its 20 dma but at least its well in its Bollinger Band. SPX Hourly looks like it wants to make a higher high before turning lower more distinctly. VIX was slightly lower, on a hourly MACD signal.

    Almost all Breadth Indicators are negative. My 2 trading signals remain bearish. The 3 positive divergences seen vs. SPX on my proprietary model late in June and early in July are currently working through the market. Just don’t forget about those 7 huge negative divergences mid-April through mid-June.

    Supporting charts and 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!

  32. As always with gold and GDX,after getting beaten down,you start at the bottom and work your way up.My percentages of buying kick in as the following occur.
    Gold escapes embedded reading (now well under 20)add 10-20% to GDX.
    GDX is not embedded,so I’m looking at the 10 d and 20d(21.74 and 22).Above that I’ll add another 10-20%.(Currently 21.64)
    When the 10 crosses above 20,another 10-20%.None of that has happened yet.
    But that’s what I’m watching.

  33. gtoptions says:

    Thanks Tony
    SPX ~ Symmetry, Timing, Low @ 7/14

    https://www.tradingview.com/x/1Zu4NuXg/

  34. mcgcapital says:

    Having a hard time seeing the bottom as being in at this point. The higher lows point is SPX specific as Dow made a lower low than last week and Nasdaq made its low last week rather than on the first test. This has been a particularly tricky correction but with the divergences any push up into the 2430-2450 area is likely to be short lived. The length of time we’ve been trading this range for suggests that the break could be explosive. I think if 2400 area goes we could see a very sharp move lower over a couple of days but that would then set up a much firmer base for a strong rally

    • vivelaamo says:

      Are you still short FTSE? I’ve been paying to much attention to RUT where it looks like the short action was FTSE. May have bottomed at 7300 though.

      • mcgcapital says:

        I’ve been playing the 7300-7380 range mainly. I’m short now but close to ditching as it could be breaking up. However, when we were trading the 7490-7550 range there was a pop to 7560 and another one at 7480 when trading 7380-7450 so if there’s no follow through it could get bearish again. Given everything else is testing resistive areas and that it doesn’t quite feel right to me that we now go to new highs again without more of a reset that’s kind of what I’m expecting to happen

  35. stockop says:

    weird day today. cboe put/call ratio pretty high which says higher prices to be seen, and yet ISEE is giving a reading that says retail bulls are jumping hand over fist to buy…never seen such a bearish ISEE reading. would love to know what so many retailers saw today that made them jump in with such reckless abandon.

    • Days with “All Securities” ISEE > 200 (like today): 11-21-13, 12-17-12, 9-14-12, 7-20-11, 1-5-11, 12-9 & 12-10/10, 3-9-09, 12-29-08, 5-3-06, 5-9-06, 3-2-06, 2-16-06, 2-1-06, 1-30-06, 12-30-05, 12-9 to 21/06, 12-2-05, 11-21 & 11-25-05, many days from 6-15-05 to 10-24-05, many days from 10-22-04 to 1-10-05, 9-8-04, 7-2 & 7-12-04, many days from 10-22-04 to 1-10-05, 9-8-04, 7-2 & 7-12-04, many days from 5-23-03 to 4-30-04, 11-29-02, 12-9-02, 12-17-02, 4-4-02. End of ISEE data.

  36. scottycj1 says:

    Looking for GC highs near 1220 tonight/tomorrow and then hard down. I expect the SPX and GC to move sharply in opposite directions starting tomorrow.

  37. UPDATE: Gold running upwards, too, parallel to Ndx, proving that “risk”-assets in general are back in style. Or is it just the weak US$?

  38. Thanks Tony and the quote below is very insightful.

    “While this downtrend still has declining highs: 2450-2443-2439-2432, it also has a couple of rising lows: 2406-2408-2413. It seems a bit odd, for a downtrend, that the two recent declines over the past 1 1/2 weeks have not broken the SPX 2406 low.”

    Over the past five days tech has been the largest and most consistent contributor to SPX gains and NDX is approaching an interesting juncture between 5720 and 5750 where I believe it will make an important decision: continue the trend up or reverse. As long as the SPX remains married to tech, it will likely weigh upon index prices.

    In any event, SPX faces an obstacle course: https://tvc-invdn-com.akamaized.net/data/tvc_edd175c0ecb56fbeb914f5495233be2f.png

  39. vipulm555 says:

    Amzn is blasting of with, gaps ,
    Plus MACD but signal from close to 1000.
    NDX is also close to PMO buy on daily.

    I just can’t father, yesterday was last great buy.
    Before we blast off. I can’t see any down move with. NDX recharged.

    Back to 2525. Before August as I said before

    http://schrts.co/Zj2s78

  40. UPDATE: “Tale of 3 Trends (2)” – Turnaround Tuesday – Ndx is still in uptrend despite today’s shakeout (at “2” on chart), Spx and Rut are trying to regain their uptrends. Expect sideways action in futures this morning to reset over-bought indicators and takeoff upwards at latest during the main session, one day earlier than the 2nd minor market cycle low this week scheduled for Thursday.
    The markets are pulling at the reins!
    (Three charts:)
    http://imgur.com/a/wu1tu

  41. soulsurfer says:

    Thanks Tony! Regarding your observation “It seems a bit odd, for a downtrend, that the two recent declines over the past 1 1/2 weeks have not broken the SPX 2406 low. Resilient market. And the DOW still has not confirmed a downtrend.” IMHO, the answer lies with Tech (NDX):

    https://investingintelligent.wordpress.com/2017/07/11/will-the-ndx-determine-where-the-spx-goes-next/

    Do or die for the Bears once again.

    trade safe folks, but boy there are so many great individual ticker setups currently out there:-)

    aloha
    soul

  42. Global developed market gov. long bond rates seem to be breaking key support levels, the market is starting to anticipate the ECB cutting back its stimulus rising long rates should cap equities in the short-term still like your volatile trading period scenario until September.

  43. ” It seems a bit odd, for a downtrend, that the two recent declines over the past 1 1/2 weeks have not broken the SPX 2406 low. ”
    ….and the Fed+PPT grinned knowingly.

    • bfquant says:

      Sick feeling in my stomach

      • I recommend Immodium or Kaopectate until you feel better.No charge.Been there.

        • bfquant says:

          I manage about $200m, and it can be rather costly for us to trade under our current custodian relationship. Thus, it would really irk me if I am forced to get more long out of sheer discipline only to have the whole thing “trap” the trendline break. I am seeing some signs that a headfake North could be a real possibility this time around.

        • fotis2 says:

          Who hasn’t? When I started trading every time I hit a loosing streak ”Funny how they never come in ones” I did pushups could hardly manage 15 in the beginning now I can do 200 without batting an eyelid.

      • pooch77 says:

        Charts look even worse

  44. vivelaamo says:

    Thanks Tony. Didn’t want see daily hammer or
    Long legged Dojis forming across US indices. Above them tomorrow and the PB could already be over which would be very disappointing. Goodnight all.

  45. phil1247 says:

    EURO

    as discussed last week
    in extension longs
    screaming upwards now

    little to prevent it from reaching the 1.15 target
    longer term resistance is now at 1.26
    now that the extension short has been broken

    until the extension fails
    the sky is the limit for the euro

    • phil1247 says:

      this ties in nicely with the 3 year dollar peak that was due feb 2017
      at some point the dollar will rally into its mid cycle peak due august 2018
      then it should continue to crash into the 2020 3 yr cycle low
      gold should see an accelerated advance after the summer of 2018
      when the dollar is in free fall

      • torehund says:

        With Hillary on bail, floating on democratic foam only, euro keeps up. Pheripheries goes first in Europe, then the euro will fall.

    • Hi Phil, Would you mind explaining what’s “extension short”, “extension longs” if you got a little free time? Will dollar’s mid cycle peak be a corrective B wave high (lower high) or a higher high than 104s? I see DXY has broken the weekly RSI up trend line started from 2008. Has it completed the bull market and will back test its long-term breakout level near 80s? Thanks a lot.

      • phil1247 says:

        http://tos.mx/tosmx/item?id=s78KfC&image

        here is an old chart i found with the basics

        • phil1247 says:

          double click if it doesnt open with one cllick

        • ariez5 says:

          Phil, I appreciate this post. What I don’t get is the .236 reference: “23% target is dotted line 2289”. Would you explain?

          • phil1247 says:

            the -23% target is the fib extension above the high
            then either you will get a pullback from that level
            and you will draw the next traditional long
            or you will go thru it and you will be in an extension long

        • phil1247 says:

          having trouble with tos picture sharing newbie
          blurry picture but basically 15 yr cycle peak came in with 3 yr in feb 2017
          expect dollar to fall for the next two 3yr cycles into the 15 yr mid cycle low
          dollar target around 60
          but overlap must be seen at 90 to confirm it was only 3 waves up

          • Hi Phil, nice of you to be so helpful. Learned a lot from you and others here. You mentioned “at some point the dollar will rally into its mid cycle peak due august 2018”. Would you mind giving the expected high of the rally? Heartfelt thanks!

            • phil1247 says:

              it is just the smaller cycles pushing against the dominant 15 yr and 3 yr cycles
              could be right or left translated ie peak before or after 1.5 yrs
              the key will be overlap near 90 to confirm that the entire dollar rally was
              just an upward correction of 3 waves of the decline from 120

              then i would expect a decline to mirror the 120 to 70 drop
              A= C targets dollar at 50
              then we will have the inflation that gub mint desperately seeks

  46. torehund says:

    Thanks Tony.
    Oil looks the way Bdi did a couple of years ago, BAD.

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