Wednesday update


Overnight the Asian markets were mixed. Europe opened higher and gained 0.4%. US index futures were higher overnight, and at 8:30 both housing starts and building permits were reported lower. The market opened at SPX 2564, a new high, and naturally following recent patterns, began to pullback. Around 11:30 the SPX had retested 2560 and tried to rally. At 2pm the FED’s Beige book was released: The market hit SPX 2564 just after 2pm then began to ease back. The market then pulled back to SPX 2561 and closed there.

For the day the SPX/DOW gained 0.40%, and the NDX/NAZ were mixed. Bonds lost 10 ticks, Crude rose 10 cents, Gold dropped $5, and the USD was lower. Medium term support remains at the 2525 and 2479 pivots, with resistance at the 2575 and 2594 pivots. Tomorrow: jobless claims and the Philly FED at 8:30, then leading indicators at 10am.

The market opened at record highs today, helped by IBM powering the DOW higher. Then as has been the routine of late started to pullback. Higher opens get pullbacks, lower opens get rallies. The pullback was only 4-points. Then after hitting the high just after the Beige book the market pulled back into the close. No change on the short term count. Except that this last wave has now reached SPX 2564. The grind higher continues. Short term support is at the 2525 and 2479 pivots, with resistance at the 2575 and 2594 pivots. Short term momentum continues to display a negative divergence. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: uptrend


About tony caldaro

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98 Responses to Wednesday update

  1. stcoleridge says:

    VIX had a high of 11.77 today yet you can buy the November contract for 11.565.
    Complacent moi?

  2. If anyone cares about the boringly bold and beautiful, the DJ utility index will be trying for new highs shortly. 🙂

  3. vivelaamo says:

    Hanging men all round. Go below and we may finally have a short top with that elusive 3% pb we’re all waiting for. Go above and its time to continue rallying. I know what my moneys on. Evening all.

    • mcgcapital says:

      That Dow is unbelievable. Not sure it will
      Ever pullback again at this rate. Might as well
      Just go long at 2.30 and switch off until 9pm every day

      • allen kimble says:

        It’s a F_cking BUBBLE!!!! This time it’s in the DOW…Who would of thought the Big boyz would choose such a has been index to create the biggest Bubble known to man kind. Well it’s a sight to behold. This isn’t normal at all…..The Dow is acting like a tech stock or index.

        The Writing is on the wall here Folks

        • lunker1 says:

          your quote applies to your post

          “WTF? That came out of nowhere. It’s littered subjective ideas…..I don’t know where to go with this.

          Damn this board has the most self indulged people on this F-ing planet”

  4. see how this plays out
    nano 4 2548 completed
    Nano 5 2585
    micto 4 2520
    Micro 5 2605
    Minute 4 2532
    Minute 5 2665

  5. Mary773 says:

    “Whenever Nano 3 completes, Nano 4 may only require about 15-point pullback from current levels.”

    Mission accomplished?

  6. S2 says:

    I created a custom indicator called Dynamic RSI many years ago but like most tools, it is only as good as the person using it and I wasn’t very good. 😉 Nonetheless, I am always fascinated by data analysis. DRSI is based on the theory that relative strength is typically much greater in wave 3s than wave 1s and that wave 5s typically fall just shy of wave 3 relative strength but can slightly exceed it in some cases with weak wave 4s and that wave 4s typically have DRSI lows that approach but do not drop below wave 2s. In essence, DRSI is one technically measurable way to count waves. By all DRSI measures, the current bull market has not exceeded the DRSI of the 1990s (which is the highest DRSI on record going back to the mid-1800s) maintaining CY2000 as a likely 100+ year wave 3 top and CY2002/CY2009 as likely wave 4 bottoms. The current bull market could be a wave 5 topping, but, given the first 3 waves cross 3 centuries, an 8-10 year wave 5 seems unlikely meaning we are likely ending wave 1 of 5 rallying into the 2030s or 2050s when China and India demographics become economically unfavorable like Japan from the 1980s and the USA from the 2000s.

    More short-term, since the Jan/Feb 2016 bottom, the DRSI in Feb 2017 still narrowly exceeds the DRSI we see today making the current rally a probable wave 5. Of course, wave 5s can grind higher without much rise in relative strength. So, the 100+ year wave count and 2-year wave count seem pretty clear to me, but DRSI for CY2009–>today is a tiny bit higher now than it was in 2013-2014 by some measures making it a possible 1-2-3-4-5 or 1-2-1-2-3. If SPX overlaps the previous wave top near 2100 as I think possible in 2018Q1, the subsequent rally will either be a 1-2-1-2-1-2-3 explosion to SPX 3000+ OR the last big rally before wave 2 of 5 from March 2009 which would be economically difficult and reach SPX 600-1600 (50%-100% retracement to the previous bear market bottom or bull market top). Tony’s OEW seems to favor the more bullish scenario, but a large 7-17% correction seems likely over the next 3-6 months with a HUGE inflection point in 2018. Good luck my friends.

  7. phil1247 says:

    rocketing up to resistance ………
    .. best not to be too greedy
    as gold still looks dicey here

  8. asaraniti says:

    AMAZING! /ES in a CTT(?) retested the 61.8% SHORT at 2554.71, for the second time during normal trading hours. Currently it has been bumping against this level for about 40 minutes. The tape is slow but whats weird, is that the contract size (40, 50, 60) are much bigger defending this level on high ticks (> +400)today than in the past couple of weeks. . As I write this post, YM is starting to weaken a bit at the high NQ is trading similarly to /ES.

    That’s the bear side. The bull side is that for the past hour looks like a bull flag is trying to form with a target around the GAP fill. AMAZING!

    In English, /ES and NQ just defended for the second time their respective 15 minutes SHORTS and YM is still in 15 minute LONG. Still sitting and waiting for the SHORT or the LONG to break before a taking a position. BTW, if the SHORT does brake there could be a n immediate 4 point pullback, a micro 50% LONG if that holds we are going to fill the GAP this afternoon next stop is this weeks high.

  9. torehund says:

    Newbie territory😜🆘😜🆘🔚

  10. phil1247 says:

    ZN 10 YEAR treasury note futures

    cant get too enthusiastic about TLT
    when the canary in the coal mine is still wheezing

    tore …. i am looking to rebuy TBT

  11. NEWBIE says:

    Whos ready for the 30 point down that gonna start within the next 7 spx points?

  12. amittsite says:

    Happy Diwali to Everyone and especially Tony Caldaro from India..May a million diyas always light up your lives..

  13. H D says:

    $52 CL is a big level….. still !!! ok that’s the limit.

  14. asaraniti says:

    CTT was a textbook a, b, and c. /ES traded to the 61.8% SHORT to the tick and was defended …so far. Charts still bullish until /ES 2540.09 breaks. Leaning bearish because the 61.8% SHORT was defended.

    BTW, no professional gap and go, So, /ES has a 75% probability of filling today’s GAP. Full disclosure, I have NO open positions today and in a wait an see mode.. Let the market tell me it’s intentions.

  15. lunker1 says:

    After one last ABC up yesterday looks like the ABCDE ED/LD on SPX was correct and completed and now the sharp expected retrace for a diagonal. Question is did 2564 end the 3rd or 5th wave from 2417? The diagonal should retrace to 2547 min. Anything more than the gap fill at 2536 could mean the move from 2417 was completed

  16. H D says:

    October 18, 2017 at 11:29 am
    SPX minor 5= .618 of 1 here 2566. Sept open to high 44 points, Oct open to high now 44.

    20 handle hit off fibs and noted symmetry! didn’t even get a reply yesterday. sweet

    • travis01 says:

      That’s the way it should be. I see ya😎. Also follow ur Twitter. Just have to skip thru the mess here

      • H D says:

        Thx Travis. I appreciate that. Not sure why we share set ups and ideas. At one point Tony had me hooked on the Law of Use but today’s society and our little community has evolved some. Not sure who still believes what.

        Knowledge, like wealth, is intended for Use.

        • floyd drummer says:

          i follow you as well….
          ….always appreciate your comments.

        • lunker1 says:

          Dude all this crying just because no one replied to your post? Every day there are several calls and most of us read them all. The 618 was interesting although I found the 44 to be a stretch but glad it worked for you

          • H D says:

            Ha, no crying here. Making money, getting laid. Exceptional month actually. Mrs. HD bot me a new F150 4×4, little HD smoked a really nice buck Saturday, account is in the green…. dude USA!

            What time did buyers show up? 25(55)
            I’ve been saving a bottle of AZ Del Bac whiskey for a month like this.

            Time to check out again.

  17. Bud Fox says:

    Brief Comment on History. It is simply, amazing. The SSO low in very early
    2009 was $6.71. Today, years later. SSO is at $100.07. HIndsight, is 20/20.
    But, ya must admit, The SSO price advance has been remarkable…..end

  18. bfquant says:

    Does anyone here trade Cocoa? I am currently long on this multi-month basing and compressing breakout.

  19. phil1247 says:

    havent heard from aahmichael for a while…………….

    perhaps today ??

  20. allen kimble says:

    SPX appears to be in a very steep rising wedge, starting from the end of August Except for the one day bump over and then subsequent pull back into the wedge on October 5th and 6th, the pattern remains in tack. Today is probably the first signs of this pattern unraveling. What it suggests is a move ultimately to the beginning of this pattern, to around the 2400 region.

  21. Good morning traders. In the overnight session, /ES traded to it’s large 50% measured move LONG to the tick and rallied (CTT?) off that level>>>so far. BULLISH!!!!

    Bottom line

    1. The extension LONG broke in the overnight session
    2. /ES needs to break 2540.00 for a trend change bullish to bearish.
    3. If /ES 2454.82 traded above this level, /ES reconfirms a bullish trend on the 15-minute chart.
    4. On the break of the extension LONG there is a normal 50% SHORT that leads the/ES to retest and perhaps break both the 50% and 61.8% measured over LONG.
    5. Notes on the chart….

  22. someone doesn’t like Thursdays…6/29, 7/06, 7/27, 8/10, 8/17.

  23. lcd00 says:

    Apparently Bots have deep memory as well as virtual bad dreams….

  24. For those punters in NZD the change in government to a left leaning bias will negatively impact housing and immigration 2 key factors which have been driving above average GDP growth over the last 8 years. The outcome is more welfare housing supply and much less immigration should pull GDP growth to a lower level. AUD/NZD has been consolidating in a triangle for a few years should burst out if we have a economic slowdown. Lower economic growth will mean kiwis will move to Australia seeking employment. The people here who have benefited from booming house prices will be very depressed soon I am expecting an inventory build to pressure house prices. That’s all from NZ.

  25. fotis2 says:

    7 days grind up wipes out in 70 minutes

  26. torehund says:

    Rut is pretty overbought right now and oscillators turning down, time to rest for a month ?

  27. stormchaser80llc says:

    Hello everyone! To concentrate my efforts on my development, posting to this blog will only be done twice weekly, each Wednesday and for the Weekend. But you can sign up any day to see FREE and FULL content by visiting

    My Awesome Swing Trading signal turned BEARISH 10/17 at 2559.36. I got out of stocks in my 401k and am looking to go short SPY with PUTS.

    My proprietary Technicals Model was higher for the 36th day in a row, with a positive divergence at 9/1’s peak vs. SPX, foretelling of this bullish run. The Model made a nominal new high in early October which could be counted as a double top. The Cumulative version of the Technicals Model made a new All Time High 10/18. My statistically driven Volatility Model is historically low, meaning a big move should be developing shortly.

    SPX daily is above all major moving averages, though negative divergences are set from the March 1st high. At the hourly scale, at today’s highs, negative divergences were strengthened across the board (for the past 10 days), so SPX is likely setting up to head lower in the not too distant future.

    VIX finished lower today, on a hourly MACD SELL signal. Positive divergences on the 15-min chart at today’s lows, yet none on the hourly chart, so any bump in VIX should be minor and brief.

    Market Internals, participation and breadth indicators were mixed today. Many of these are in positive territory, yet are well off peaks from earlier in the year. SPX A-D line made a new All Time High on 10/16, obviously above its 20 dma which is ascending. SPX McClellan made its 2nd negative reading in a row.

    Oil may have ended its extended consolidation with a large gain Monday, though negative divergences at the recent top mean a new high is not for certain.

    HYG:IEF is off last week’s highs, though with negative divergences, may have been a top (BEARISH for market?)

    Supporting charts and much more FREE analysis at my site ( 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.

    I want you to know I am quite serious about developing my site the right way, I am in this for the long haul, and I will improve my services at every opportunity I have. Traders this next part is for you! I recently uploaded a significant upgrade to the Trading Platform (see top menu of my site for the link). I offer 3 diverse models for the SPX AND the consensus of all 3 models, at time-periods of 1 min/5 min/10 min/15 min/30 min/1 hr/2 hr/4 hr and soon longer periods. No matter how frequently you like to trade, I will have you covered. I even have the ETF GLD (gold) available at the 1 min timeframe. These timeframes, available trading vehicles (why not oil, why not china etf?), and models will continue to expand over time! If you are an active trader, you will view my site as something more than just a daily analysis of the markets. I want traders to live here during market hours! I want us all to make money!

  28. learnedmylesson25 says:

    Nothing much to add today.So I’ll give you a paragraph of
    “Tuesday was another good example of the many oddities markets have displayed in 2017. SPY printed a 52-week high on a 52-week low in volume. The only other non-holiday that has happened in 24 years was August 7 of this year, right before the “massive” 2.4% pullback. The S&P and Dow both hit new highs even as breadth was negative both days. That’s only happened twice in 55 years (April 16, 1964 and March 20, 1995). The intraday ranges in recent weeks are ticking at or near record lows, yet implied volatility is rising. These oddities typically precede weakness, but 2017 has bucked so many historical precedents it’s hard to place a lot of weight on the idea that all of a sudden NOW it will matter.”
    I wonder why…lol.

  29. vivelaamo says:

    Dow hasn’t even dropped a hundred points in over a month! May as well Keep buying until it does.

    • mcgcapital says:

      That gap down to 23000 has to fill surely at the absolute minimum. Never seen anything like it, I honestly don’t get why investors are interested in buying at these levels. Traders following the momentum but you don’t get his type of bid just from day traders

  30. jhjoyner says:

    Spy bull pennant looking good!!

  31. bouraq says:

    Chart of the day is #DAX at

  32. Bud Fox says:

    Hello…I am looking for a good stock to invest in for
    the long term 3-5 years. Suggestions?

    • chrisk44342 says:

      I’m not an investment professional nor do i play one on tv but I’ve always like Lockheed. Nice div and we always seem to find a way to kill each other so why not play with the house?

      • Bud Fox says:

        I will take a look at Lockheed, and old company. But,
        I do not use age as an investment factor. Thanks,
        I shall look at it, now…Bud

      • Bud Fox says:

        LMT is to rich/expensive for my purse.
        But, sure a great company.

      • Bud Fox says:

        The Lockheed low of 73, in 2013 would have been great.
        Now, price is much higher though….

        • Mary773 says:

          I am patiently waiting for CMG management to be replaced.That company resides within multiple demographic sweet spots and would be a Buy And Hold Indefinitely if the company were not being run by Ethel Mertz and Lucy Ricardo.

        • chrisk44342 says:

          Bud, look at the rest of the market. It’s all overbought The only reason i invest in stocks is for dividends. Otherwise i speculate in fx, futures, etc. Not sure i would buy any stocks for 3-5 years where my only goal was capital appreciation

          • Bud Fox says:

            Yes, you raise a good point as well. But, it begs for an answer.
            Just how much longer, can the SP500, run higher? Iwas looking at
            Pretcher’s SP chart; long term from 2009. And, with no surprise has
            us in a 5th wave up, that appears, near completion. But — the concrete,
            answer of do we still go high, would appear to be difficult to get my mind
            around. Much less, accept. If you have ever bought a stock, only to see it
            crash days latter. Then you have some understanding, of my concern.
            Clearly, the Bullish sentiment is also hard to fathom….end

            • chrisk44342 says:

              Well one important caveat: Prechter is a loser. Always has been. What’s the saying about a stopped clock? He is wrong 99% of the time and the one time he is right, he is proclaimed a guru. No one knows what the market will do- that’s the point I am trying to make and have made here many times. Unfortunately, everyone is looking for a method that can ‘predict’ things, which is really preposterous if you think about it. And this again is why I give TC so much cred. No predictions, just adjustments. It’s not a trading system- but it is valuable.

      • torehund says:

        Chris what if peak killing has been reached, Just now🤔 The Trump/Kim effect😜


    I am still long HSCEI. Think it can go higher.
    Dax may set up for a trading short tmrw.
    S&P. No value in counting small waves. Just get a headache. Keeping it simple. Should have another 4% upside before any issues. Those issues may be terminal.
    Facebook. Who uses that crap anymore. Sell it

    • Xy Z says:

      “Facebook. Who uses that crap anymore. Sell it”

      I couldn’t agree more. I and three other people that I know have stopped using it. Elephant in the room?

  34. asaraniti says:

    Didn’t you here the stock markets has a 100% guarantee of being up next year, why short?..LOL

  35. Thanks Tony.

    current micro wave 3
    52-33-62-21-76 so far at 2564
    Pretty stout wave 5 . 1.618 of wave 1 would be 84 points our 2572

    looking to short if not already to late at 2566. the 1.618 of minor 1 or the 1.618 of this wave 1-2572

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