Wednesday update

SHORT TERM: gap up opening again, DOW +123

Overnight the Asian markets gained 0.1%. Europe opened higher and gained 1.4%. US index futures were higher overnight, and rose higher after FED chair Yellen’s testimony: https://www.federalreserve.gov/newsevents/testimony/yellen20170712a.htm, was released at 8:30. The market gapped up at the open to SPX 2439, then continued to 2445 by 10:30. The SPX had close at SPX 2426 yesterday. After a pullback to SPX 2439 just past noon, the market moved a bit higher. At 2pm the Beige book was released: https://www.federalreserve.gov/monetarypolicy/beige-book-default.htm. Around 3:30 the SPX hit 2446, then dipped to close at 2443.

For the day the SPX/DOW gained 0.65%, and the NDX/NAZ gained 1.15%. Bonds rallied 13 ticks, Crude rose 35 cents, Gold added $4, and the USD was higher. Medium term support rises to the 2428 and 2411 pivots, with resistance at the 2444 and 2456 pivots. Tomorrow: jobless claims and the PPI at 8:30, then the budget deficit at 2pm.

The market gapped up at the open today for the second time since last Thursday’s SPX 2408 low. That was the day the NDX/NAZ made its lowest low in about one month, while the SPX missed by 2-points of hitting its 2406 low. Since then the NDX/NAZ has risen for four straight days, while the SPX has rallied: 2432-2413-2446. The DOW, which did not confirm a downtrend, made new uptrend highs today. Since the SPX 2454 uptrend high we have been noting the rally highs during the downtrend: 2450-2443-2439-2432. Today the market blasted right through three of them on its way to 2446. Not an unusual move if this is a B wave of some degree. But definitely something to note. Also, after two failed attempts at breaking the SPX 2406 downtrend low, we now find the SPX within just 8 points of its all-time high. Interesting juncture. Was that it for the downtrend, as Minor wave 5 is now trying to subdivide? If the SPX starts making new highs it is definitely worth considering Minor wave 5 subdivisions. That would make SPX 2454 Minute i, and SPX 2408 Minute ii, with Minute iii underway now. Resilient market. Short term support is at the 2428 and 2411 pivots, with resistance at the 2444 and 2456 pivots. Short term momentum ended the day overbought. 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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98 Responses to Wednesday update

  1. stockop says:

    some oil stocks with potential intraday breakouts. closes at high of day would be extremely bullish for the sector.

  2. torehund says:

    Nice squeeze in Biotech, is this the time for it ?

  3. Joe Longwill says:

    Tony
    I have a question in regards to your OEW.
    After reading your oew stuff last week and understanding
    somewhat what you were saying ( no, i dont claim to know your oew )
    you hit a point with me on mathematics. I think i understand what
    you call this an SC wave 3 . Just in understanding it is an eye opener
    for me yet im not sure i completely agree but im on the right track well
    at least i kind of get it .
    So here a question for you and it is based on the Dow from 1982 to date .
    this is also assuming the jan 2000 top is the top of wave 3 and the 2009 low
    is the low of wave 4 ( different than your wave but for educational purposes )
    Under that scenario would 23079.83 be a valid wave 5 target ???
    Im pretty sure your going to say yes .
    on the other hand labeling the 2009 low as a wave 2 calls for Dow 112,000 plus ?
    im coming up with un imaginal targets doing this dow 63,000 seems like crazy
    yet …..? who knows .
    22296.85-23410.28 i see as a resistance .
    my concerns come from my own cycles work which don’t turn down until June 2018
    yet im trying to figure a reasonable target.
    i doubt you will answer this with any detail but have a question in regards
    to your oew tutoring . what all will a person learn ?? is there any proprietary methods
    you use in regards to the oew methods that you don’t teach ? if so what are they ?
    Thank you for you updates they are very much appreciated .
    Joe

    • tony caldaro says:

      Hi Joe,
      Cannot confirm, or not confirm, your targets for the DOW as I do not know how you arrived at them. In regard to the tutoring. What you read in the updates, my comments, and see on the charts posted, are the results of OEW analysis. I never post any of the proprietary information that covers how the labeling and projections were achieved. That is only for students. Project, monitor, and adjust is the theme, because we are dealing with probabilities and nothing else.

  4. gary61b says:

    Unofficial nuclear aggreement with the US and NOKO, Kim Jong Un agreed to stop nuclear arms development, for a lifetime supply of twinkies and ding dongs…

  5. 3 basic counts appear.
    1 Int 4 waiting for b to finish then drop in a c wave
    2 minor 5 finishing up around 2480
    3 minute 3 headed to 2550
    Anyone have something else

  6. No follow through on bonds.Bearish for gold if they stay embedded.Stocks benefit in all likelyhood.Now that Congress has cancelled vacation for a while,the markets probably go up anticipating the Holy Grail (tax cuts/heathcare reform).GDX said 22 didn’t have enough oxygen and sold off.Later.

  7. gary61b says:

    ES has resistance at 2447. If it gets that high..

  8. mjtplayer says:

    The complacency is nothing short of amazing. Just look at the VIX futures curve: Aug contract just over 12, Sept contract just over 13 and Oct contract under 14. The Aug-Oct time period is historically the most treacherous for markets and when most crashes, drops, corrections occur – but per the VIX structure, nobody is buying protection or pricing-in any volatility. Traders have been lulled to sleep over the past 6 months, volatility has been compressed and nobody thinks it will change. Caution ahead over the next 2-3 months.

    https://www.barchart.com/futures/quotes/VI*0/all-futures

  9. cmucha68 says:

    Wait until the FBI arrests Donald junior for conspiracy. Then the real move down starts.

  10. vivelaamo says:

    Phil didn’t you say Euro going to the moon and Gold cannot rally? Are you losing your touch buddy?

  11. I was expecting a big down this week, boy was I wrong. Looks more like a 3 up finishing somewhere around new highs, then a small 4 down back to around 2440ish then another 20-35 move higher to finish this up move then maybe we get a 5 percent pull back. Relentless bull for sure

  12. Page says:

    I am expecting market to start its reversal process today, time to be bit cautious here.

  13. phil1247 says:

    /ES
    coming down to test extension long near 2436
    if it holds
    target is 2451

    thats all folks …………. see ya !

  14. biotechs hourly squeeze

  15. pooch77 says:

    Lol seems yesterday was the high not the low,so we should go down ibto the weekend

  16. phil1247 says:

    /ESU7

    back to test 2436.50 …. why ?

    its the traditional long target from 2222
    that was hit on june 2 and has been a barrier to advance since then
    targets become support and resistance levels ..

    market needs to stay above it
    to reach the next traditional long target of 2478
    bullish above 2435.5

  17. cmucha68 says:

    I suspected at the beginning of the week that we will move up to 2440 – 2444 area and I was extremely sceptical with the P4 A move down. But who wants to argue with the Boss. The Boss is always right they say. I am really curious to see now when the real P4 starts, if there is any.

    • fotis2 says:

      You always have to throw in your 2 bits hey cmucha?Waiting in the sidelines and at the first whiff of a miss count out you come like Jack in the box get a life man.Tony’s count was 2450 back at the 2150s he gave a excellent entry on the nikkei at the lows but lets forget the good ones

      • cmucha68 says:

        You are right fotis. hope dies last. The last 2 thursdays the market was going down hard. Who knows what will happen today.

    • stcoleridge says:

      It might be worth remembering that according to OEW the fourth wave in question is intermediate, not primary.

    • bfquant says:

      I don’t label waves this way, but when someone says P4, do they mean Primary 4? If so, Tony was never anticipating Primary 4. Rather, there is a reasonable potential for Intermediate 4 fairly directly (or now).

  18. Phil 1247:
    Thanks for posting the explanatory chart the other day. I found it helpful in gaining a little more understanding of the Dean Hoffman method.IIt was actually posted for someone else’s benefit, but I thought it would be a good learning opportunity.

  19. Fionamargaret:
    I may send Jeffrey Saut an e-mail. But I am going to need to re-write the post so it doesn’t sound like it was a post on a blog. I will omit the part about smoking too much weed and simply say that his theory was over-reaching. Candidly, though, I was embarrassed for him that he came up with something like that, but I don’t want to be disrespectful.


  20. here’s AtoZforex’s look at gold.Pretty similar to Ira.1230 is key.

  21. IRA:Gold and bonds unembedding.Rallies today for both would confirm short term rally.
    Me:GDX getting above 22 keeps that going.
    IRA:Gold getting over 1230 changes bear pattern.
    Analysis today indicates the Fed may pause until December.Not sure anymore if that means the dollar rallies on that or sells off.Logic says,sells off.No logic in these markets.IL-logic says,Fed not tightening gives the economy more room to grow–therefore, a higher dollar.
    LOGIC says,rates aren’t going higher–so the dollar drops.Where’s my commemorative coin with Newbie on one side and Camp Freddie on the other?It’s come down to that again.
    Good night all.

  22. stormchaser80llc says:

    Undeniable. Those who looked into market participation, internals and breadth can see today was a huge signal that the BULLS are not done. Both my trading signals went BULLISH. The 3 little positive divergences on my proprietary Technicals Model since late June predicted this turn. However I do not think the 7 negative divergences seen vs. SPX mid-April through mid-June have played out yet. My thoughts, SPX gets close to or achieves a new All Time High, before BEARS will get their chance again.

    SPX volume is next to none. On the hourly scale it reached the 2444 pivot again, and made many technical negative divergences at today’s highs. After a pullback expecting a new uptrend high. The only positive divergence seen on VIX hourly is on its MACD, so it needs new lows, and remains in MACD SELL mode.

    Got a marginal Hindenburg Omen today on SPX since its McClellan went positive. Looks like good rotation, with oil traders seeing that with a bullish day taken away as money flowed out.

    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!

    • ariez5 says:

      Fiona, I like Grimaux and love BB King. But I could never understand why Aarau had a career. What do you find appealing in his playing?

      • fionamargaret says:

        Ariez, Arrau’s earlier work was colourful, touching, yet displaying masterful interpretation (especially with Liszt). I succumbed to his touch rather than Richter (who often chose the same pieces).He was oddly unreliable in his playing…never quite the same, but in an interesting way.
        It was later I listened to Richter and started liking his take-no-prisoners playing and then…. just as you think he is just too rough, he plays like his lips are gently touching your skin and he caresses the keys, pleading to the music ….I know….as I said before, it is a love story.
        I think I posted both pianists playing the same music…you can shut your eyes and see what you think…

        I was not here today, so was delighted to receive your note. x

        • fionamargaret says:

          What I forgot to mention was I meant to play Argerich, Arrau, and BB King…all a little bit older…slightly tongue-in-cheek. My computer decided otherwise.
          This was Arrau’s last concert.

  23. tommyboys says:

    A/D new highs…

  24. gtoptions says:

    Thanks Tony
    B Wave!

  25. Thanks Tony and I like you identifying possible count options in these uncertain times as I don’t believe it is at all certain what the market is going to do. Some of today”s gains stemmed from a different tone from Yellen:

    “The Fed “continues to expect that the evolution of the economy will warrant gradual increases in the federal funds rate over time,” Yellen said in her prepared testimony.
    Yellen noted, however, that the federal funds rate “would not have to rise all that much further” to reach a neutral level.”

    That is like Janet telling the market we are almost home honey even though the rate decision making process is market driven.

    I am leaning to a retest or perhaps a new ATH followed by a very rough late July through August/early September. Tony’s original correction calendar. The 33 point gain off of 2413 equals the gain when the market moved from 2406 to 2439.

    The market likes certain wave lengths.

  26. vivelaamo says:

    Thanks Tony. Look for today’s gap fill tomorrow or Friday then take it from there. Good night all.

  27. hohoho598 says:

    The Jackson 5…can you feel it, can you feel it, can you feel it….pause….the count is about to change again…LOL

    • lunker1 says:

      Yo Ho, I think you missed the memo that OEW isn’t really concerned about short-term count changes or trading it’s about tracking the trend changes so the med and long term counts can be quantified

      • hohoho598 says:

        Yes, yes, I see, I see, that’s why you get “daily” updates to quantify the “long term” trend. I guess it makes sense, not to me, but to some I suppose, dunno who though….whatever….

  28. mcgcapital says:

    Thanks Tony. Is this a record for the smallest % downtrend if we’ve bottomed already? It doesn’t feel quite right to me, seeing if FTSE can hold the 7440-50 area and resume its downtrend. If it is to subdivide that would imply much higher prices before the next proper pullback which doesn’t seem to fit very well with most of the indicators I track

  29. vipulm555 says:

    Rotation is life blood flow bull market,
    Notice Dow during was dull ? Musical chair.

    This is a strong bull market , 2525 next stop

  30. mtu MTU says:

    [EOD] Stocks –
    A potential way to reconcile the wave structures of SPX and INDU. See charts.
    https://market-timing-update.blogspot.com/2017/07/market-timing-update-71217.html

  31. jhjoyner says:

    Wow all 10 sectors up today.

  32. STEPHEN BARTLETT says:

    Closed my S&P short a few days ago. Looks like the sideways has completed and we target 2500. Still long the uk miners. They have been strong. Will buy dollar yen if this pullback continues.

  33. bfquant says:

    Thank you Tony. Superb guidance.

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