Monday update

SHORT TERM: higher open then pullback, DOW -13

Overnight the Asian markets lost 0.1%. Europe opened higher but lost 0.1% as well. US index futures were relatively flat overnight, but the market opened three points above Friday’s SPX 2549 close. Right after the open the market started to pullback. By 10:30 the SPX hit 2546. Then after a bounce to SPX 2549 by noon the market headed even lower. In the last hour of trading the SPX hit 2542 twice. Then bounced to close at SPX 2545.

For the day the SPX/DOW lost 0.10%, and the NDX/NAZ lost 0.15%. Bonds gained 4 ticks, Crude rose 20 cents, Gold rallied $10, and the USD was lower. Medium term support remains at the 2525 and 2479 pivots, with resistance a the 2575 and 2594 pivots.

The market opened slightly higher today, but immediately began to pullback. Thus far the market has only declined about 11-points from the SPX 2553 all-time high. If this is the Nano 4 wave we have been awaiting, the market should drop another 10+ points to confirm. All notable pullbacks since the SPX 2417 Micro 2 low have been between 21 and 33 points. The R2K, TRAN, and NYSE were all a bit weaker today, maybe it is time. Short term support remains at the 2525 and 2479 pivots, with resistance at the 2575 and 2594 pivots. Short term momentum nearly hit oversold today for the first time in two weeks. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: uptrend


About tony caldaro

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105 Responses to Monday update

  1. scottycj1 says:

    Negative D on the daily NYAD

  2. Mary773 says:

    In 1929 and 1987, when DJI topped it was more than thirteen percent above its 50 week sma. A current equivalent in SPX is 2890. Based on this metric, stocks have entered bear markets from current levels but have not crashed. Insofar as a melt-up is concerned, they are characterized by an inability to violate the previous week’s low, and that is not happening either. So no crash and no melt-up. Just a boring old bull market in which “everyone” is concerned that “everyone else” is too bullish,.

    • scottycj1 says:

      In 1929 and 1987 the USA was the world leader in manufacturing and agriculture. Great opportunity for growth in industrialization and many consumer products. Today we are an aging service economy. In about 12 years 50% of our population will be 65 or older on Social Security/Medicare—-Maybe. Real wealth is produced by the new emerging economies of Brazil, China and India. We have allowed lazy self serving politicians to raid the treasury of our country and put us in 20 trillion in debt. When we finally get a man in the White House who is not on the take…..he is fought tooth and nail at every corner trying to improve our situation. CEO’s of corporations are only concerned about the next quarter and how many stock options they will be able to exercise….0 long term planning. They have spent billions on stock buybacks for the same purpose. Not reinvested that money in new plant and equipment which would create jobs. This country is not what it used to be.
      Your not comparing apples to apples.

    • JK1987 says:

      Mary, it’s not as simple as using 50 week sma, there are a lot more, for example, here is the all important long term business cycle Top.
      but speaking with your language of DJI 50 week.
      current DJI is comparable to 2007 top as of percent above its 50 week.
      2007 DJI declined 55% in 2.5 years.


      • Mary773 says:

        Agreed. That was a severe bear market, but not a crash which is what I was discussing. In order to have a bear market now, don’t we need some lower highs and lows?

  3. vivelaamo says:

    Rut continuing to consolidate within a bull flag. Bears can’t even get it below 1503. Could easily explode to 1540 region any day.

  4. scottycj1 says:

    NDX Bearish engulfing bar

  5. learnedmylesson25 says:

    Here are the perameters for GDX.Friday, GDX got above the 10d(23.21),then yesterday the 20d (23.54).Those must hold.Upper bb at 24.33 is next target.Once the 10d crosses the 20d,it looks like a good rally.should take place.Good luck all.

  6. asaraniti says:

    Thinking outside the box…for NANO wave 4 that is. If /ES breaks 2540.09 today, I’m going to think about an expanded or irregular flat. Chart is for my buddy mcgcapital…LOL


  7. torehund says:

    Waiting for the 6 x 3,14 to kick in 💰💰💰

  8. naz43 says:

    Dear Tony,
    I discover your website some weeks ago. I have a question: I see that on the weekend update, the short term SPX chart (60 min) had ever new target levels (resistances) . in the last weekend update for example you wrote the following : “Short term ………….resistance at the 2575 and 2594 pivots” .
    In previous weekend updates the SPX target was 2525.
    My question is how you calculate the targets by OEW ?
    Thanks in advance,
    Best regards
    Maurizio Bramuzzo from Italy

  9. phil1247 says:

    11:30 reversal period coming up……….

    time to exit …………………. euro … gold and silver

  10. gary61b says:

    Who called 2552 level as possible end of nano 3? I posted this on another site
    gb [8:38 AM]
    ES I am thinking this is the set up for reversaL but I will let it prove it to me once it reaches the 2553 area. 2 hr. chart
    Gyazo (45kB)

  11. phil1247 says:

    SILVER .. SIZ7

    looking to exit at 17.30 to 17.32 unless i see upward acceleration there

    its been a rocket ride

  12. phil1247 says:

    TLT …….

    short entry coming up near 125
    wanting to rebuy TBT near there

  13. Jack Sparrow says:

    today might be the reversal day.. the move from 2490 seems complete

  14. asaraniti says:

    Watch /ZB just broke it’s 61.8% short. CONFIRMATION of a potential trend change is .. a pullback into a 50% micro LONG at 152’0. If this holds it’s bullish for bonds and bearish for equities (assuming the bond relationship to equities holds).

  15. scottycj1 says:

    Might just be 4 and 5 are done…………………………….

  16. kvilia says:

    Lee – reporting back. Holding CL through UWT with the target of 54.58 – daily hwb worked perfectly this time.

  17. learnedmylesson25 says:

    Heeeere’s Elroy.

    • learnedmylesson25 says:

        • JK1987 says:

          that should be about it, for all inflation based assets. great deflation coming.
          equity, making new high with the required technical – long term cycle satisfied today 10/10/17.
          gold, that should be about it, last time we discussed about gold with the charts, all there. here, 50 day & 38.2% are the resistances, and the deadly wedge forms.
          oil, that should be about it.
          10y t. yield is fully cooked, hence brings deflation to all.
          wonder why “inflation” could not hit FED’s 2% goal? because deflation is so powerful, and coming is the great deflation worldwide, debt deflation. the one hit Tokyo & Athens, and could never recover ever.
          someone mentioned 1929, that was debt deflation. Fisher went bankrupted with it. all well studied & charted & documented.
          tlt/tmf went up with equity making earlier morning. up more with equity pull back.

          from your link:
          “To make money in the market, you have to bet against the consensus and be right” – Ray Dalio
          but Dalio keeps on worry about 1937. imho, he did not study history enough, even though his direction could be ok, but down the road, he could be making huge mistakes, like the one he did in 1982, which bankrupted him.
          and consensus alone won’t make you money, need to know the history, all history worldwide with charts.

  18. Bud Fox says:

    Tuesday – looks like 3 waves up, thus a 4th and then 5th are expected next…Bud

  19. Good morning all. As I mentioned yesterday, the 15 long broke yesterday afternoon on slow, sloppy, low volume, holiday trading. It looks like sloppy trading at that break because the 61.8 SHORT broke AND after the SHORT broke, a micro LONG defended, that was your entry into the LONG. The highest probability for the next entry will be the gap and the original 50% LONG. This morning’s
    targets are the recent high and the original profit target at /ES 2554.82. In terms of Nano 4, it is on life support. A new high invalidates this count for me.


  20. phil1247 says:

    phil1247 says:
    October 9, 2017 at 2:11 pm
    .. Lee

    gold ready for 1295
    fotis2 says:
    October 9, 2017 at 2:20 pm
    Pullback ? it just took off man all the yada yada on Friday and I missed the bus.

    Lee………… ding !
    Fotis………. giddyup… or no corn for you …. one year !

    • phil1247 says:

      Fotis ………….
      forget gold ….
      ……. look at SILVER.
      .. oh mamma ! just doubled longs

      • fotis2 says:

        Looks to me exactly the same run to the tick Phil noway anyone could of guessed that move that is still just jump in and hope for the best kinda trade

        • phil1247 says:

          now .. silver only 10 cents from short entry
          i am already looking for the exits
          too late to chase

          • fotis2 says:

            In fact it is now in a countertrend and the next big daily short is the 1310 level if we were to follow the system objectively without any bias and constant drawing of fibs ad lib

          • fotis2 says:

            Aah thank you glad to see no flies on you Phil..

          • phil1247 says:

            are you talking about ” could not guess the move in” silver fotis??
            silver was the easy buy yesterday because it was stronger than gold
            gold was tougher .. but doable by the close
            and no “guessing “involved

            • fotis2 says:

              Based on what did you go long?

              • phil1247 says:

                dumped all slv bot yesterday
                may rebuy when i can put a stop in

              • phil1247 says:

                SLV yest broke above fri high
                never overlapped … bought several times below 16
                made new high late yesterday
                gold lost embed yest so shoot up to 1295 was a gimme
                since silver was stronger it should soar as gold runs up to 18 day sma

                no DH involved at all

  21. learnedmylesson25 says:

    Ira sez:Bonds,dollar,equities (except for Nasdaq)is embedded,bonds bearishly.He says Russell and Dow are showing distribution the last 3 days.Dow loses its bullish stochastic and 23300 is likely.Also a bull trap on the Dow.S&P has a BEAR trap possibility,with a break above 2550.Dollar close to losing its bullish embedded reading,but not yet.
    Me:If it does,more fuel for a GDX rally.Gold unembedded,so more upside likely in GDX.VIX also lost its bearish stochastic.Good luck all.

    • JK1987 says:

      melt-up is the hottest and most popular topic recently.
      second time JS talked about melt-up.
      Stephen posted the melt-up article from the All-America Hall of Fame Jeffrey deGraaf
      looks like everybody agree upon the “melt-up” since Aug low.

      but i totally dis-agree about the “melt-up” scenario.
      let’s get some statistics correct.
      SPX broke out and +2.5% from 8/8 high, and +5.8% from Aug low.
      first, this so called “melt-up” is the smallest of the 4 cases listed in the following chart/table for the past 12 months.
      they call it “melt-up” because it was “unexpected” from them.
      “Traders now give a greater than 90 percent chance of a rate hike at the Fed’s Dec. 12-13 meeting, according to the CME’s FedWatch tool”.

      what i am seeing is completely the opposite from all!
      i am seeing 10-y yield going to melt-down to the lowest level, lower than 2016 low of 13.36, hence TMF will be very lovely. 🙂
      and i am seeing equity market going for a biggest melt-down since 2009. not the recent “melt-up” size.
      i am seeing economy started plunging so fast that the interest rates began falling sharply
      thus the market/economy forces will force the yield to plunge steeply.
      -33000 job is first piece, there will be more and more coming in for the puzzle.
      between cause and outcome, don’t know which is the cause – sharp economy turn down or market melt-down. either way, it will be there.
      October still has plenty of time, potential of a melt down toward next FOMC 10/31 certainly is in the card, and the potential has increased sharply in my book. from cycle, better would be SPX makes another higher high toward Oct 11.
      in the “things” i observed, in a not too distance future, it’s almost impossible for the market to have the biggest melt-down since 2009.
      come back late night, i might use my post #2 to show you how the 10-y t. yield would plunge sharply. i don’t see any chance how it could not.

    • fionamargaret says:

      Martha playing Chopin In her own inimitable way…what a presence, a complete joy….she just sweeps me away.
      73 years old, two times cancer survivor, but she would not have me write that…it is all about the music, and when she plays, that is all you think about.
      You can see her hear the music, and translate it onto the keys, with that wry smile ever so often pulling you in, and making you the audience, part of it all.
      Oh, Martha……x

  22. bouraq says:

    Chart of the day is $GOLD at

  23. Lee X says:


  24. Thanks Tony.

    I came upon an article in MarketWatch which quotes Jeff deGraff which immediately sparked interest as he is easily one of the best analysts around. Cut and paste material follows:

    “We make the case that despite the Fed’s intent, we’re on the verge of being in a melt-up stage, fueled by excessive credit and a timid Fed,” wrote technical analyst Jeff deGraaf, chairman of Renaissance Macro Research, in a Wednesday note.

    Whether the market continues to melt up “remains to be seen, but what has happened since a week ago sure resembles how such melt ups begin,” he wrote.

    De Graaf, meanwhile, argued that it is the strong data, and what he sees as a behind-the-curve Fed, that is setting the stage for a potential meltup.

    He fears that favorable credit conditions are driving asset inflation and points to the gap between the yield on the 2-year Treasury note TMUBMUSD02Y, +1.67% which is near a 10-year high at 1.479%, and the fed-funds rate, which stands at 1% to 1.25%.

    • tony caldaro says:

      good find
      I’ll take it

      • I know you track the one year yield and I believe there is gap there as well. 1.35% vs FFR of 1.125% Agree?

        • there is nice correlation between the rising 2yr interest rate and bank stock performance and profitability, banks would love higher interest rates to improve their net margins, as long as rates move slowly up everything should be okay economy. Yield sensitive stocks should under perform ie. consumer staples, utilities, telecos, reits.

    • tommyboys says:

      I agree with him and – errrr – posted the link last week…

    • fionamargaret says:

      Stephen, I was out running with the dogs a few days ago, and happened to hear a gentleman on Bloomberg suggesting to look at the chart of 1929, and compare to the present day. Supposedly they had a magnificent run-up in the market before the crash, and he was suggesting the same for now…a bunch higher. No, I am not claiming to have heard it first, just interested in someone comparing the charts for me…..if anyone has time. Thanks..just interesting.
      On the other hand, I could make a really nice case on why the market drops now…all to do with the square of 9 and cycles by an Indian astrologer…

      • Thanks Fiona. The retired hedge fund manager Dr.Steve Sjuggerud has said this run-up will never be repeated. Quoting from an article published in March, the ex hedge fund manager said:

        He told me, over the next year or two, there’s a realistic chance investors could double – perhaps even quadruple – the size of their retirement accounts.

        But there’s some risk as well: He warns, if you miss this bull run – and history proves correct, you will never see anything like it again.

        I am not a follower of Sjuggerud but in doing some superficial research it would appear he has made some prescient calls but whether he is right in cautioning “you will never see anything like this again” remains to be seen and will take considerable time to resolve.

        Prior to this discussion, I have entertained similar thoughts but not to the extremes of Sjuggerud .

  25. iamnotviv says:

    Thanks Tony. For those looking at the FTSE, 7540 looks to be the perfect entry for a pullback. Daily is showing signs of turning over. Maybe 7400 in the coming days ahead.

    • mcgcapital says:

      So you’re in the UK then? Why are you trolling vive? This analysis is fair enough but don’t see why you’d sign up just to troll.. there’s enough idiots posting already

      • iamnotviv says:

        Tbh I thought it was out of order for Viv to be insulting other members of the community. Whatever your views are there is no reason to be provoking people. Ironically I may’ve been doing the same to Viv, but he deserved some of his own medicine. Somebody else must’ve been creating accounts btw!

        • vivelaamo says:

          Don’t see why you have to hide behind a fake account though.

          Thanks Tony for the update.

          RUT looks like it’s in a bull flag.

          • iamnotviv says:

            If I posted under a different name would that make you feel better? The majority of people on here post under a pseudonym so how is it any different? Re: RUT I agree. Holding longs.

    • Xy Z says:

      I am (looking at the FTSE). Thank you.

      Thank you, also, Tony.

    • scottycj1 says:

      Got a short term sell signal (4hr chart) in the FTSE today.

  26. asaraniti says:

    Good evening all.
    From the series of my late afternoon posts, I believe the SPX is trading in Nano wave 4. I know it is early but I can give you 2 levels to watch in the overnight session and tomorrow’s trading to confirm this analysis. If /ES trades above 2546.36, this call is invalidated.

    Bottom line….
    1. There will be a CTT in the overnight session and /ES will test 2545 – 2546.36. If 2546.36 holds, that would be add more probability to the Nano wave 4 analysis, as it opens the door to a retest of /ES 2542.13 which was Friday’s support level and 2540.09 the 61.8% 15 minute LONG.
    2. /ES needs to break 2540.09 to reconfirm the trend change. By reconfirming the trend change, the profit target is 2536.54 and a bit more support at 2530. IMHO that would be enough of a pullback for Tony to label this pullback as Nano wave 4.
    3. /ES 2530 (SPX 2432) is major support. That would also be a 20 point pullback, enough for a possible completion of Nano wave 4?
    4. Notes on chart to save text space here.


      • Counter trend trade. This happened late this afternoon, as the /ES retested the lows, bears sold more /ES contracts as they thought there would be more selling into the close and they got trapped. Some bears were forced to cover and that provided the fuel for this rally. Score another for the bulls. At times you can think of some of these counter trend trades (CTT) as short covering rallies, can happen on all time frames.

        • aahmichael says:

          re: “…bears sold more /ES contracts as they thought there would be more selling into the close and they got trapped. Some bears were forced to cover and that provided the fuel for this rally.”

          You certainly have a vivid imagination. In reality, the only thing anyone knows is that markets decline when there are more sellers than buyers, and they go up when there are more buyers than sellers. You have no idea if the sellers today were exiting their longs and getting flat, or if they were initiating new shorts. The inverse is true when the market reversed late in the day.

          On the other hand, based on the chart you posted this morning, one could also explain the late day action as the market running the stops on all the DH system followers who had gotten long, only to get stopped out at the dead low, which, by the way, is also how you could explain what happened in gold on Friday. (costing DH system followers a $20 loss in their GC long trade.)

        • Jack Sparrow says:

          Asaransiti thanks for the reponse

      • tommyboys says:

        Change in trend

    • Nicely done asa and and its interesting how you interweave the two time frames. As Tony mentioned, he is looking for nano 4 to be similar in depth to recent pullbacks which have been in the 21 to 33 pt range. Again, well done.

  27. Mary773 says:

    Thank you. Tony.

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