Tuesday update

SHORT TERM: new highs then pullback, DOW -33

Overnight the Asian markets lost 0.2%. Europe opened lower but gained 0.2%. US index futures were lower overnight, and the market opened 5 points below yesterday’s SPX 2481 record close. Right after the open, however, the market started to rise. Just past noon the SPX hit a new all-time high at 2491, and then started to pullback. The pullback lasted until 3:30 when the SPX hit 2470. Then a bounce into the close ended the day at 2475.

For the day the SPX/DOW lost 0.20%, and the NDX/NAZ lost 0.20%. Bonds lost 3 ticks, Crude slid 30 cents, Gold added $4, and the USD was higher. Medium term support drops back to the 2456 and 2444 pivots, with resistance at the 2479 and 2525 pivots. Tomorrow: wholesale inventories at 10am.

The market opened lower today, made a low at SPX 2476 within the first 15 minutes, and then started to rally. Just past 11:30 the SPX broke through the OEW 2479 pivot range (2472-2486) on its way to 2491 just past noon. With the breakout of the pivot this uptrend, which started at SPX 2408 in early July, cannot be a B wave. As a result we updated the SPX hourly/daily charts to display Minute wave iii of Minor wave 5 underway. The previous uptrend/downtrend reversals have been downgraded from Minor 5 to Minute waves i and ii. With a Minute iii underway it suggests Minor wave 5, of Int. iii, is extending. Which is exactly what the DOW has been displaying for several months.

The short term count is not totally clear, but it does look like a possible 5 waves up from SPX 2408: 2432-2413-2484-2465-2491 to end a Micro 1. Micro 1 of Minute i was 77 points, and Micro 1 of Minute iii is currently 83 points. Short term support drops to the 2456 and 2444 pivots, with resistance at the 2479 and 2525 pivots. Short term momentum dropped from quite overbought to slightly oversold. Best to your saber rattling trading!

MEDIUM TERM: uptrend

LONG TERM: uptrend

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

About tony caldaro

Investor
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155 Responses to Tuesday update

  1. Bud Fox says:

    Bear Market ? May have begun with the SSO at 94.50 HIGH…
    That’s the way, I see it right now…..Bud

    • Bud Fox says:

      in review…I must admit. I could be, early in my Bear market call.
      the question to me is — just how “early”…my thinking is TC is
      watching the same SP price pattern. Thus, the next shoe to drop
      would be for OEW to turn Bearish on the SP500. And, that is what
      I am watching for. No, not fully in SDS, as yet…end

  2. EL MATADOR says:

    CL triangle done….break out coming sending it to 51.73…that my take as long as 48.37 holds

  3. Bud Fox says:

    NY A/D line is Bearish, and that confirms my investment plan to a cash position.
    Note, this message is late in the call — if not very late. Following the OEW NY
    A/D line is a simple, but great investment tool….Thank you, Tony for sharing it.

  4. torehund says:

    From Armstrong: CNN claims Putin is moving the north pole towards London in order to freeze Europe in order to sell more gas and make Sibir a tropical paradise. Well Sibir has been in a bear market for long, maybe its time for its Bull market🌴

  5. vivelaamo says:

    So many cycles!!

  6. H D says:

    August 8, 2017 at 11:40 am
    first 10 handle rally today in a long while. Some profit taking, return to normalcy could be on deck.

    #timestamp Nice profit taking yesterday and it appears some return to normalcy today.
    Range 2,462.08 – 2,472.89
    Seems like the BOTs are back and we can expect ‘the business’ EOW. JMHO

  7. vipulm555 says:

    All these bear folks are chewing there fingers
    I told ya green close today.

    Smartz 🙂

  8. Lower bb on SPX rising rapidly,so 2437 support is actually 2450ish.GDX crawls above 10 and 20 d.Not real impressive,but at least a chance.Still no real energy there.Still say 80/20,this flops.Later.

  9. JK1987 says:

    unless 2459 violated, spx should have bottomed, and moving toward 2500 in the next 8 days, fibo, eclipse, and seasonality history.
    At that new ATH, we will once again have (probably larger):
    A-D divergences,
    indices divergences,
    volatility divergences,
    progressive divergences. 🙂
    chart:
    https://wordpress.com/post/likejksaid.wordpress.com/120
    (don’t know a way to directly post a chart here, so use my wordpress account to post a chart)

    • pooch77 says:

      Looking for down to flat tomorrow ,then bottom Friday morning and up into 18th

      • JK1987 says:

        I think this morning’s spx 2462.08 is the cycle low price.
        Is your bottom Friday lower than 2462.08?

        I have the cycle up to Aug 23 for spx 2500.
        Then down to Oct 20.
        What does your MT cycle says?

        Based on my calculation and timing, I am looking for vix surge to 100 on Oct 20. NEWBIE will be a genius at that time :). ( I posted that technical yesterday morning).

        • pooch77 says:

          I don’t think we break 2457 or 1390 rut as we are getting quite oversold.I believe we go up into 18th but no higher than 2490 and 1410 rut .October to far out for me. 100 vix??? We gonna drop one on N.K.

    • While I think it’s a fool’s errand to make any ‘bottom’ calls right now, we should all be watching the 2,459 level very closely.

      Some are calling that July 27 low (2,460-ish) a 4 wave, and others are saying 4 happened at yesterday’s low, as the e-wave of a triangle, which was then thrust up out of to hit yesterday’s ATH.

      Any movement below the 4-wave level indicates that yesterday’s ATH was the end of the impulse up, and we’re now in a larger-degree pullback that in my count, I’m expecting to be in the 100-point range, so back below 2,400.

    • Bud Fox says:

      Your not, Jim Kelly by any chance, are you?

  10. naz43 says:

    Oggi Gold INDICI – Breve/Medio periodo
    DOW 30 : In corso onda (5) Inter di (1) Major verso 22100/500
    S&P 500 : In corso onda (5) Inter di (1) Major verso 2500/50
    DAX 30 : In corso onda (a) Inter di (2) Major verso 11800/500
    EST0 50 : In corso onda (a) Inter di (2) Major verso 3500/300
    MIB 40 : In corso onda (5) Inter di (1) Major verso 22000/500

  11. possible wave 4 finished today with a 5th wave up to 2504 has or will start. I am currently long with a stop at 2555.

  12. shauryagh says:

    EUR MAKE OR BREAK: The EUR is pausing to catch a breath right at the top of the muli-year broad range that has been forming since Mar 2015 . It broke the range when it crossed 1.17 decisively. The range break sets up a target to the 1.28 – 1.3 area. Long term stochastic analysis suggests that the range break is indeed real..EUR shud be accumulated on all pull backs to 1.16 – 1.17 with stop loss at 1.12 for a target of 1.30.. On the flip side if the EUR analysis is correct then the current DAX,downtrend is just getting warmed up for a final target of 10900 over the next few months….

  13. JK1987 says:

    Tony, Thanks for the alternate count, that’s the count I like the most and started with when I re-start.
    With this count, the bull market still is intact, just another correction (spx was nearly -20%) before launching much higher. Both bulls and bears should be happy with this count.
    The seasonality is the same – Aug – Oct. Both time and price are perfect.
    http://stockcharts.com/public/1269446/chartbook/477010691;

  14. fionamargaret says:

    Oil long UWT until it reaches 18.5, and then we shall see if it goes further….oil might have 70 in its future….

  15. micky says:

    Oh oh, I just love my lines. No voodoo, no stars and moons, only lines. We hit the 1st LT(weekly) at 2484 area where I reduced my lt holdings. We then hit the second one at 2490 odd, and then dropped 30 points. I mentioned both numbers a while ago. I still only scalp the long side unfortunately, so will see what happens. I wont post all the support areas where I may take scalps but the bigger trend remains up so that’s the direction Im playing.

  16. I’m looking for YM 21860 area very soon, perhaps today.

  17. shauryagh says:

    A close below 1397 on the RUT cash level will set-up a nice short with 1433 stop loss and 1288 first target which will be met within the next 3 weeks IF RUT cash conclusively breaks 1397…MAKE OR BREAK….

    • pooch77 says:

      1333?

      • shauryagh says:

        If RUT breaks 1397 then the entire consolidation phase for 8 long months from Dec 16 till date will be confirmed as smart money distribution…In such a scenario the RUT downtrend will not respect the 1335 support…hence my first target is 1288 which is approx 1/3 retracement of the entire rally from the lows of feb 16… It will probably go further than that but that’s a topic for discussion IF RUT breaks 1397 decisively and stays below that on Friday close as well….

  18. scottycj1 says:

    Last weekend I posted ……..

    “scottycj1 says:
    August 6, 2017 at 9:24 am

    For the last 8 days the market has been under a negative cycle……That cycle ends this coming week on late Tuesday or Wednesday.”

    Well here we are on Wednesday the last potential low of this cycle. I know MCG doesnt believe these types of predictions are possible…….but here we are.

    • mcgcapital says:

      Scotty, if that works out for you this time then I take my hat off to you. Not looking to pick fights so apologies if I’ve overstepped the mark with some of my posts. Just saying how I see it. Best of luck

      • stcoleridge says:

        You didn’t overstep in the slightest.

      • Lee X says:

        MCG

        Scotty is very emotional and has left the blog in a huff several times only to return again and again.

        Keep doing what you’re doing

      • aahmichael says:

        mcg, your posts are always very balanced and well reasoned. If the market bottoms today and goes to new highs, scotty will say that his cycle nailed it. On the other hand, if the market goes straight down from here, he’ll say his cycle inverted and nailed yesterday’s top.

  19. gary61b says:

    At open spx will sync up with EX with a spx gap down then both will move up together. looking at 2471 ES level that should gap fill spx…

  20. mjtplayer says:

    S&P looking to gap-down 10 handles at the open, will be interesting to see what happens then: rally and drift, or gap and go – lower?

  21. vivelaamo says:

    For those that don’t read RJ. They call it right more often than not. Here you go:

    ‘We continue to think the near-term does deserve some caution, but that any weakness is for buying and the most likely floor for the S&P 500 remains around 2322 (about 6.5% below the July 27 all- time high; see chart page 1).’

    Have a good day all.

    • cyanus66 says:

      RJ still haven’t gotten over their awful call last January, predicting imminent bearish action & missing out on February’s spectacular rally.
      Although I enjoy reading their daily missives, their timing models do leave much to be desired, much like most models to be sure.
      Quoting yesterday’s note : ‘…without telling folks how the proprietary models are actually constructed, suffice it to say they are not always right’.
      I would not disagree.

    • fotis2 says:

      50/50 is the best even the very top traders can do this is why money management correct R/R, disciplined trading,sticking to your own system thru thick and thin are much more important factors than getting it right or wrong thereby enabling the trader to stay in the game and make money in essence it does not matter if the Market is bullish or bearish and after all is said and done overcoming ones own self and staying humble is the key to success.

    • pooch77 says:

      That’s our goal Vive get a sizable correction and long for nice profit.But it’s double nice to profit down then up

    • fionamargaret says:

      RJ is delivered to my mailbox in the morning, but I don’t post until evening….so maybe this helps…it is basically a day behind when you read it….

  22. 5 min compression, SPX

  23. stormchaser80llc says:

    Very interesting and important point of time here for traders. Was that price spike the top? The candle sure fits. My swing trade signals are still bearish (7/28 and 7/31). Internals, Breadth and Participation, are well off of recent highs, have been pulling back, and certainly would support a bigger drop in the market. VIX finished higher, and made a hourly MACD BUY signal. The pattern could be a bull flag, so that’s something to watch, but for that to be valid I would like to see positive divergences where there are only a few as of last Friday.

    My proprietary cumulative Technicals Model DID NOT make another All Time High today, with its daily reading back below zero. SPX made its new ATH but SPX A-D did not confirm it yet. SPX Weekly and Daily would support a major top at anytime due to long lasting negative divergences. The SPX McClellan has been negative now 7 of the past 8 days.

    The market despite today’s spike and drop, is tightening. You can see it in the Daily Bollinger Bands, and the Daily Bollinger Band width is near historical narrowness. This proceeds big moves. My Proprietary Volatility market only has this period of time being more volatile than 0.6% of the time since 1990. Bearish Elliot Wavers would say the leading markets (NASDAQ and RUSSELL 2000) finished a W2 higher, and the other markets that made ATH finished their run up. We’ll see if that’s the case.

    SPX Daily had a string of 7 real and 10 total Hindenburg Omens since late May. Be careful this run-up as it may be the last before a BIG turn lower. I say this as my proprietary Technicals Model made its 10th negative divergence vs. SPX since mid-April, and the third one of its kind since 3 positive divergences since late June. Yet another higher high in SPX is still possible to once again negatively diverge with my model, but you can clearly see that the technical indicators on SPX stocks are weakening quickly.

    Been calling this Oil rally pretty well. Got the pullback that I warned about. I think a new high forms in oil to put in widespread negative divergences.

    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!

  24. Small rally in gold tonight,small selloff in S&P futes.Break 2467 and 2439 is likely.Trump must have bought some puts at 2485…lol.I don’t believe any of this chart action anymore.How long before the market ignores everything but bombs dropping?(soon).Unless the market starts dropping 50-100 SPX points a day (which would indicate Tillerson is telling his buddies the SPIT is going to hit the fan),you can’t take it seriously.Good luck all,I’m going to my fallout/bomb shelter now. (Not).

  25. UPDATE: In retrospect yesterday’s activity along with the overnight pullback looks like an INVERTED market cycle (top instead of bottom on day of market cycle low), with which an approximate 10-day consolidation/correction will probably begin, possibly ending with the coming eclipse of the sun (21st August).
    spx hourly futures (charts now in white, hopefully better visible on smart phones) –
    http://imgur.com/a/mUH3y

    • vivelaamo says:

      So when the day of a market cycle low rally’s and then drops it becomes a market cycle top in the same day? Am I missing something?

      • Let’s say that’s a hypothesis I’m building because
        1) of the seemingly wide-spread belief that the new moon, which according to my studies tends to mark market bottoms, marks a market top instead because it has apparently been present during some major tops and
        2) my experience that occasionally what according to the calendar should be a market cycle bottom, acts and looks instead more like a top and is followed by such a consolidation period.

        At least it is psychologically understandable that in a strong rally where momentum carries over longer than would normally be expected it may also carry over to a point of excess and to a time when normally a bottom would be due, collapsing within itself like a burnt-out star when momentum begins to recede, all the more when knowledgeable experts (speculators) are there to take advantage of the situation.

        Practical, down-to-earth example: If you stay up too late at a party some night, once the enthusiasm begins to wane and you realize that it’s actually way past your bedtime, strong fatigue may suddenly set in. The stock market is a good example of psychology on a mass scale.

        • mcgcapital says:

          Lol this is another cracker. Money is made in the markets by doing the things that Fotis has posted above. In the last week we’ve had ‘the market can’t go down because a small sample group of individual investors now have a few more people that are bearish’, ‘the market follows a secret cycle based on delta theory’ which presumably a small group of people are profiting from while the rest of the world struggles on, and now the moon/sun eclipsing determines where it goes next. I don’t mean to have a go at anyone person in particular but none of the above will influence the market anymore than what colour underwear I have on today. People seem to be trading based on superstition rather than price action or even economics

          • STEPHEN BARTLETT says:

            i have noticed a positive correlation with the days I go commando and my p&l.

          • scottycj1 says:

            You have a go at everybody……and never make a forecast yourself…….you just think your superior to everyone and tear people down but never add anything meaningful. There’s never anything helpful out of your mouth.

          • The difference is that my cycles are NOT BASED ON ANY THEORETICAL or HYPOTHETICAL BASIS, but are a result, similar to (O)EW, on years of empirical studies. And like (O)EW they are difficult if not impossible to “prove” by mathematical or heuristic testing. I’m sure they could be tested for probability with a sufficiently sophisticated computer set-up, which I unfortunately don’t have. Anyway, if I proved them beyond any doubt, “everybody” would be using them and they soon wouldn’t work any more! And I would rather be successful than “right”.

            Still they are very useful in combination with my other resources, that suffices for me, and anyone else is free to compare the results when I issue a comment based on them. Not much you can say against that, I think, except that you are just a non-believer!

            • mcgcapital says:

              Thanks Lorenz. As Vive says, if it works for you then great. But obviously I’m skeptical about this kind of stuff. Anyway, that’s more than enough posts from me today!

        • vivelaamo says:

          Thanks for the reply. Whatever works for you I guess.

    • fionamargaret says:

      Richter proves himself the master once again in Beethoven’s Hammerklavier Sonata, providing rich light and shade to a rather difficult work. Anyone who has played it probably can attest to burning hands, a better understanding of the piano, Beethoven….but most of all themselves….x

      A really interesting footnote….London, who had started piping in classical music into the subways, found crime reduced to such an extent, they are now going to do the same in a couple of housing projects….I wonder if this would go down well in Pyongyang…..x

  26. cj32 says:

    Cr. CBZ

    • cj32 says:

  27. vipulm555 says:

    North Korea is like Suddam, WMD

    They all Peter out

  28. mjtplayer says:

    Two leaders of the Nasdaq both down big after hours: NFLX & PCLN

    Set’s up a gap down tomorrow a.m., but then what? Recovery or gap and go lower? Tomorrow will be interesting, finally some market action.

    OPEC meeting was a dud, oil should resume falling

  29. soulsurfer says:

    2nd intra day reversal in quick succession: buyers exhaustion. Negative divergence on TIs and sell signals across the board. Negative market breadth, and price reversal from inside ideal (4 wave degrees Fib-based) target zone. All suggest topping process. Can’t exclude one more try for a push higher

    Though SPX may have experienced unorthodoxy expanding ending diagonal 5th wave.

    DOW may need few more 4th and 5th waves up; as shown in my weekend post.

    GL!

  30. phil1247 says:

    YM still looks good with higher targets….just showing the traditional long support
    the extension support is far below

    ES could not hold the extension and is back in the morass
    have not done an spx trade in weeks

    FXE ( euro ) pulled back into extension long support
    ready for another surge to new highs as long as extension holds

  31. Thanks TC. 2525 eventually.

  32. vipulm555 says:

    One day market goes down bears come in full force , more a impluse traders. Bears article already coming out

    http://stockcharts.com/articles/dancing/2017/08/bear-market-preparedness.html

    I love this kind of action, entered long for PB at close. I bet tomrrow will be an up day.

  33. vivelaamo says:

    Just a thought. If North Korean tensions really prevented the market from rallying and bought it down a few points from highs. What happens when diplomatic resolution is reached? (Which we know it will).

    • tommyboys says:

      Yep. First of all if the nut job launches a warhead in the next several months it won’t affect the US yet we will retaliate until he’s no longer an issue for anyone. Secondly sanctions will likely be all needed and have begun. Best case we liberate NK and long term everyone benefits!

  34. Today was the top. North Korea tensions heating seriously up. Game of chicken over the next week will bring markets down quickly.

  35. Thanks Tony.This market has reused smaller wave lengths quite often, particularly 19 and 24. Working with ES numbers, the bottom of the wave that topped today is 63.25……and if we add 24 we are at 87.25 compared to the top of 88.50. In cash terms, it would be 65 to 79. Pretty close and close enough to prepare for a short.. Trend lines and Fib extensions also suggest this to be an area of interest. https://invst.ly/4r67y And after reaching the top, ES gave up 21 points, slightly more than the 19/20 I was expecting. Most importantly, your relabeling of recent price history is imminently sensible and nicely describes this vexing market.

  36. bouraq says:

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

  37. 123 abc says:

    Thank you Tony, great OEW analysis.

    1. In regards to “…possible 5 waves up from SPX 2408: 2432-2413-2484-2465-2491…”
    —Believe the fourth Nano wave ought to read as 2460 instead of 2645 (i.e. chart below)?

    2. Possibly one last wave higher to end Micro-1 wave?:

  38. JK1987 says:

    ‘will be met with fire and fury’

    barking dog never bites.
    statistics – most if not all of #45’s threats are bluffing, lie.
    weakness inside and faking with outside strength.

    if you really want to do it, go ahead, don’t bark.
    has been too many times, people all know you won’t do it. enemy knows it as well.

    at today’s high, we have A-D divergences, volatility divergences, indices divergences.
    one more higher high into August end will have bigger divergences.

    • tony caldaro says:

      and a progressive divergence

      • JK1987 says:

        Nasdaq A-D line topped more than 4 years ago.
        That’s the biggest negative divergence, the same kind -div as 2000 Nas/Ndx bubble top.
        The pattern also matched!
        We all know Nas/Ndx declined over 80% after all.
        All the pattern, history keep on repeating.
        Will this time be different?

        ihmo, the most sexy and best trade, I expect it up to 100 within next three months – it’s all matched does not matter spx/dow makes higher high into end of Aug or not.

        JK1987 says:
        August 8, 2017 at 9:15 am
        It matches the pattern, In history, it went up ten-fold in 3 months.
        I am going to open this position today.
        https://wordpress.com/post/likejksaid.wordpress.com/111

        • vivelaamo says:

          JK what position do you keep talking about? That link doesn’t go anywhere.

        • tommyboys says:

          Naz AD is generally always moving south due to its configuration. Many Naz issues are microcaps and under $2 and failing at any given time due to their speculative nature. New issues are introduced and AD rallies periodically then heads south again. Is why the SPAD & NYAD are much more meaningful – and these are at ATHs with the indices. NYAD diverged for almost two years before the top in 2000.

    • H D says:

      remember when POTUS sent the armada to Australia! to show NK how tuff he is… 45 rounds of golf and a 17 day vacation, NK goes nuclear on his watch. Hey but fake news and stuff.

      • tommyboys says:

        Irrelevant

        • fionamargaret says:

          Tommy, my stuff is awaiting moderation…and I don’t think you will find it irrelevant…

          • tommyboys says:

            Draining the swamp was never gonna be easy. You’re fighting the deepest pocket agendas on the planet who will hit you with every trick in the book and lies and narratives on top. Doesn’t matter WHO the “populist” is, he/she will be hammered to submission. Trump’s our best shot in restoring SOME say to the people. Non-“lifer” politician, non-elite, no agenda for personal gain – he’s got more than enough and knows it, no need to cater to special interests etc…Will be interesting to see what new narratives are created over the ensuing few years while overlooking REAL sins of previous lifer politicians.

        • H D says:

          tommy, Trump is a con man. It’s absolutely relevant. You’re now in the <30% of GOP left that still support him. Kudos.

  39. captbara says:

    Another VIX sell setup coming soon already, wow. Santa is good.

  40. kingfrogcash says:

    $DIS a dow stock, to pull movies from $NFLX a fang.

  41. fotis2 says:

    Thanks Scott now I know why edward scissorhands became rich and famous.

  42. scottycj1 says:

    Today we had a “Scissor”. I’ve explained these before but will again for those with short or no memories. A scissor is a move that clears out stops in both directions. Look at todays action on a 30, 60, 120 minute chart. First there is a movement one way….todays was up. That clears out buy stops….you saw what happened when 2485 gave way. Then the scissor cuts back the other way and in this case gets the sell stops. This generates a lot of trading that puts cash and positions in the hands of edward scissorhands. The first direction of this scissor is which way we will go. Today was up. Often called the “Ole Shake and Take Em” ploy. Tomorrow is the last day of negative pressure.

    • mcgcapital says:

      Or more likely it’s a reversal pattern.. cleared out some shorts this morning then broke down later on and currently drifting back up in a b wave. Look at all the other major breakouts we’ve had.. none of them behave like this, if there’s genuine buying interest and not just short covering we go up and don’t look back. And don’t know what you mean about tomorrow being the last day of negative pressure.. the market doesn’t follow a short term cycle, trading that is a sure fire way to lose money as it stops you being objective

      • scottycj1 says:

        Yes it does follow a short term cycle. Being a know it all I’m sure you’ve heard of “Delta Theory” This is an improved version of that. But i’m sure you knew that too.

        • mcgcapital says:

          Not a know it all.. just know enough to know that I don’t know it all hence stay prepared for any eventuality. People post all sorts of cycles on here based on astrology, sideograph turn dates or whatever.. but think about it, how can it possibly work? If it did everyone would just trade that and it would be arbitraged away.. the market is mostly random in the short term.. the only cycle that matters is the economic cycle, so it will remain a bull market until that changes. But from time to time there are counter trend moves, and one is long overdue. Shooting star candlestick on the daily shows weakness, not strength…

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