Friday update

SHORT TERM: gap up opening on tax reform enthusiasm, DOW +166

Overnight the Asian markets gained 0.4%. Europe opened higher but ended flat. US index futures spiked overnight when the Senate passed the 2018 Budget, increasing the opportunity for Tax reform this year. The market gapped up at the open to SPX 2570, bounced around a bit, then crept higher. The market had closed at SPX 2562 yesterday. At 10am existing home sales were reported higher. The market hit SPX 2575 around 2:30, dipped, then end the week at 2575.

For the day the SPX/DOW gained 0.60%, and the NDX/NAZ gained 0.30%. Bonds lost 15 ticks, Crude gained 45 cents, Gold dropped $8, and the USD was higher. Medium term support remains at the 2525 and 2479 pivots, with resistance at the 2575 and 2594 pivots. This week the Q3 GDP estimate was reported unchanged at +2.7%.

The market gapped up at the open today for the first time since September 11th. That gap up was in the midst of the rally to cross SPX 2500 for the first time, and reach 2509. The market opened within the OEW 2575 pivot range, which was our target for Micro 3, and then closed right at the pivot. We can now count 5 waves up from the Micro wave 2 SPX 2417 low in August: 2455-2428-2564-2548-2575. Micro 3 can now top out at any time. When it does we expect a 20-30 point pullback for Micro 4, before resuming the uptrend with Micro 5. Short term support is now at SPX 2548 and the 2525 pivot, with resistance at the 2575 and 2594 pivots. Short term momentum hit quite overbought during today’s rally. Wild October Opex! Best to your weekend.

MEDIUM TERM: uptrend

LONG TERM: uptrend


About tony caldaro

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43 Responses to Friday update

  1. fotis2 says:

    USD/JPY news aside this chart for now at least looks Bullish a solid weekly close above last months high,weekly 3BR, CCI still got legs up a daily close above 114.50 will most certainly fuel the move north.

    EUR/USD setup for next week IF that potential H&S validates there is money to be made down south. Stephen Swanson at the moment as it stands this is a nothing pattern it has not even formed a H&S so I call it pending/NO TRADE SETUP.Look at the box on the daily there is a potential C&H formation again no setup pending validation charts are self explanatory.WAITING…


  2. fionamargaret says:

    Some music…..charts later, maybe Sunday.
    Thanks Tony…..and everyone. xx


    • fionamargaret says:

      Bond yields are going higher and near upside breakout
      That is helping push financial stocks to new record
      Banks and Insurers are leading XLF higher
      Industrial SPDR also nears new record with help from transports
      Material SPDR nears new record
      A rising dollar is hurting gold
      Copper shares are doing better than gold miners in rising rate environment.

      Thanks John Murphy.


      • JK1987 says:

        imho, 23.92 is quite close, but no way $tnx can break out of previous Oct 6 high of 24.02
        you still holding TMF?
        i unwillingly took minor loss of my biggest holding TMF (TMF is 40% of my entire holding), sold majority of my TMF shares, though has not reach stop limit yet.
        it’s not i don’t love TMF anymore.
        it’s something else caught my eyes that can have many many times performance of the should be strong performance TMF.
        i see the biggest once i a life time herd Crash coming, it’s unavoidable, nothing can prevent it from happening.
        it’s strange, under recent strong market rally, but i see and feel the other way. i see market longs should be very unease, seems like nobody knows what’s coming, and it will be sooner than later. most or all people’s past experience / examples won’t apply to this one and this only one of it’s kind.
        87′, 00′, 07 crisis experience won’t help to this coming one.
        one crisis is bigger than the previous one. 07 > 00 > 87
        this one will be the sum of all crisis, yes, it’s that big, nobody has experience or can see it coming.
        i wonder why should i come here to warn people, consider what i’ve received from this place and none support.


  3. learnedmylesson25 says:

    A couple charts


    • learnedmylesson25 says:

      Also ZH says stocks are the most overbought since 1955.Good night all.


    • phil1247 says:

      learned …………..
      there are very few correlations that consistently work
      and when you do find one that does
      i can almost guarantee it will fail you when you are counting on it

      remember the YEAR 7 correlation with stock market declines ?
      highly correlated
      everyone and his dog talking about it
      BOOM …………busted

      just say no…………………………….. to correlations


  4. torehund says:

    Interesting, Hollywood in a bear market because they make films that very few wish to see. Then when the going gets tough the blame game starts. Now the Women that benefited from explotation are hitting back..They accepted it as long as It was beneficial. This is classic bearmarket activity.


  5. hohoho598 says:

    This market is going alot higher, before the bears get a chance, pullbacks for sure, crash talk highly unlikely. There are no systemic problems (yet), plenty of cash around and whilst payrolls are good, 401k’s will have plenty of money to pump into the market.. simple math. OEW forecast working for now, but it will falter eventually, all systems do. Enjoy the ride.


  6. Mary773 says:

    Thank you, Tony, and congratulations on a superb forecasting week.


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