Tuesday update

SHORT TERM: gap down opening then rebound, DOW -30

Overnight the Asian markets lost 0.2%. Europe opened higher but lost 0.3%. US index futures were lower overnight, and at 8:30 the PPI was reported higher. The market gapped down at the open to SPX 2576 and continued to decline. The SPX had closed at 2585 yesterday. Just past 10am the SPX hit 2567, firmed, and started to rally. At 11am the SPX had reached 2580, then started to pullback again. At 1pm the SPX hit 2572, then bounced to 2579 to end the day.

For the day the SPX/DOW lost 0.15%, and the NDX/NAZ lost 0.30%. Bonds gained 4 ticks, Crude dropped $1.40, Gold rose $3, and the USD was lower. Medium term support remains at the 2575 and 2525 pivots, with resistance at the 2594 and 2632 pivots. Tomorrow: the CPI, retail sales and the NY FED at 8:30, then business inventories at 10am.

The market gapped down at the open today for the third time in the past four trading days. The chop continues. At the low the SPX nearly hit 2566 again for the third time before rallying. It appears the SPX is bouncing back and forth between 2566 and 2588. Great for day traders, spinning wheels for the rest of us. The price pattern since the SPX 2588 high continues to get choppier: 2566-2597-2566-2586-2574-2588-2567. Certainly not impulsive looking. Continue to see an eventual drop into the SPX 2540’s to end Minute iv. Short term support is at the 2575 pivot and SPX 2566, with resistance at the 2594 and 2632 pivots. Short term momentum was quite oversold this morning before rebounding to neutral. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: uptrend

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

About tony caldaro

Investor
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139 Responses to Tuesday update

    • fotis2 says:

      Take all your cash out now!They BS us the same way with the ”don’t worry its temporary a couple weeks maximum”….. 3 years and counting money still blocked but hey bonus you can still pay your taxes no matter the amount.Forewarned is forearmed.

  1. Richard Glackin says:

    If any of you recall, tony did say that this pullback would be relatively small…I believe he noted perhaps somewhere around 40 pts SPX. We dropped around 39 pts. In addition, today’s action ‘looks like’ we hit the bottom. Time will tell but, when Tony indicates a likely scenario (I call it sort of a forecast) it should be heeded. FYI.

  2. llerias7 says:

    MKT Back ON Recovery Mode!

    https://imgur.com/wwjr5qJ

  3. allen kimble says:

    Here comes the end of the day ramp or should I say seasonal inflows…lol

  4. if minute 4 did end today. Minute 5 equals minute 1 at 2682

    Have a good night all, see ya tomorrow

  5. amittsite says:

    Hi Tony..
    Namaste ..
    Namaste everyone..

    One question..what’s the probability that we finished ABC of minute 4 at today’s low..2578 to 2544 being A..then irregular B to 2597..and this current 38 points drop putting in wave c low of minute 4..and that whole ABC..being part of micro 5 as well..just don’t see a drop to 2544 happening in the time frame allowed..because if this rallies into 2573 today..that will rule out 2544 for me..

    Thanks for being there..
    Amit.

  6. Mary773 says:

    For those with cast iron stomachs, IBB has a double bottom at support. If it holds it will really boost NDX until the president’s next Twitter kill shot on biotech.

  7. allen kimble says:

    Well..Well…Well……..I called the bottom for today and I got treated badly. Today has a very good chance to be “the” bottom for the rest of the year. Why you might ask?, Yep, It’s all about seasonality. That alone will guard the market from going lower and will give the market it’s strength to go higher into December.

    The question is…Did you buy the F_cking Dip?

  8. phil1247 says:

    NEWBIE……………
    you are awfully quiet……..
    you must be busy raking in all the profits……………
    told ya your day was coming soon !

    • 28 Sp point from the high. If hewas short he has gotta be rich now man LOL

      • vivelaamo says:

        If he went short every single time he called a top he would have been wiped out years ago.

        Pullback over. Money flooding back in to small caps. Rotation and risk on.

        • phil1247 says:

          nothing bullish about RUT…..
          as ira would say………
          .. its the most bearish thing that could happen
          its riding the bollinger band down
          and pushing further down every day
          still dont like it

          8 days of lower highs means money is flooding OUT!

          • vivelaamo says:

            Today is equivalent of Friday 18th August. Everyone would have been shorting then to.

            Also stochs aren’t embedded. Confirm this hammer pattern tomorrow and pbs done in my opinion. If not then ok, maybe a little more downside.

        • travis01 says:

          Man I don’t wanna get started with you, but just for discussion let’s say someone puts $100k in Etrade account 1 Jan and $100k in account 2. Let account 2 run all year, pick up 3-8% if lucky. Account 1 makes 3-5 trades a year to short the market. It’s very feasible to make $10-20k each pullback. The trouble comes from trying to time the highs and lows and flipping. Both are decent strategies but one is not for the risk averse and will keep you up at night. Both are just legalized gambling. Neither should be for “must live” money. But there’s a lot to be said for ease and peace of mind too.

          • travis01 says:

            Also, I don’t disagree with your strategy at all. My long term funds are all long (retirement, kids’ college, 401ks, iras, etc). My pa in law made millions and never sold a stock ever. Different strokes. GL

          • phil1247 says:

            agree travis

            ………. my trading account is 5% of my portfolio
            even if i lost 50% i would still be up on the year
            its a “sell to the sleeping point ” type setup
            as far as my positions go……..

            i sleep like a baby every nite………….
            ………… i wake up every 2 hours ….. crying …….. 😉

          • vivelaamo says:

            I get that Travis. Me and Newbie are just having a bit to banter. All in jest and keeping it respectful. I’m sure he doesn’t short whenever he calls a top just as much as I don’t go long whenever I say BTFD!

            I agree it’s all legalised gambling.

            • travis01 says:

              Yeah no way he shorts that much but I do like his style. I like the gamble myself. Missed some great moves since last week but freaking work is killing my time! I’d love to meet the guy and buy him a beer though. I might learn something.

    • phil1247 says:

      careful now……
      if SPX 2563 is not taken out
      potential .38 extension long bounce occurred at 2557
      just like at the last iteration of this extension long
      whose target was 2599 and i am counting as hit tho it fell 2 points shy
      if 2557 holds target would be 2622
      once the short from highs breaks

      or as tony would say…………..we are getting ahead of ourselves 😉

  9. So we going to fill the gap from 2578 by tomorrow then drop to 2544 Friday/Monday

  10. micky says:

    dax also hit st support by the looks

  11. asaraniti says:

    Final update till after the close. /ES had a garden variety bear trap at the low. After a brief rally /ES came back to retest the low. It did and trapped the shorts (bears) thinking that a profit target just below at /ES 2548.42 will be tested. The counter trend trade (CCT) went straight up, no pullbacks..all reactionary trades…a hallmark of a bear trap (I know I’ll take heat on this). Anyway my call was a a rally (CCT) to the 50% measured move SHORT at 2570. Target hit on a >+400 tick, the entry back into the SHORT (with a stop, raise stop to a break even/profitable trade accordingly…just in case../below/).

    Because no profit target or 61.8% level was breached …what should/could happen next, is a slow steady grind lower to retest today’s lows. Only 1 caveat to that call and that is a 50% and a 61.8% micro LONG around /ES 2563.00 could provide support.

    OBSERVATION…I would not be surprised to see these levels trade around 3:30 EST just in time for a ramp into the close….been happening almost everyday why should today be any different?
    One last note, if /ES trades above 2574.25, this analysis is invalidated.

  12. vivelaamo says:

    Pretty decent correction of 4% on RUT. As soon as that downward trendline breaks RUT will rocket to new ATH in 2017!

    https://imgur.com/gallery/yfpym

    • cem1214 says:

      bears should be concerned about the pattern developing on the RUT….looks like its getting ready to break out into a W3….i believe the lows are in for now…xmas rally time…next correction in 2018

  13. vivelaamo says:

    Fortune favours the brave….and the bull!!

  14. pooch77 says:

    IWM and LABU huge reversal,bears dead again

    • cem1214 says:

      Agree…bears sh*t the bed yet again….picked up some LABU, TNA, and GUSH…should be good as long as the lows hold for the next few weeks

  15. pooch77 says:

    This pullback looks to be over,dont think a chance in hell we hit 2540,got within 3 points of my iwm target

  16. The way I see it:If the next pivot is 2525,then we would have to drop below the 34d by a similar amount of points that occurred in August–about 30 points back then.Not sure if that pattern repeats again.TLT may have one more run to 127 ish (upper bb).If the pattern DOES repeat,that 127 level should be a sell TLT–buy SPX.Good luck all.

  17. phil1247 says:

    asa..
    ……. good job on es……
    …i wont bother commenting on it since you are back now
    i thought you had left before…….no sense duplicating our efforts as we see
    the same thing

    • asaraniti says:

      NO! Like to hear your analysis. I am busy making decisions on my house. Meetings with architect, construction manager, tile, vanities, etc. you know the drill. I’ll post 1 last update in a minute upon top, then I have to run for a construction meeting.

  18. Holly Silver says:

    Pretend there is no US-Russia link to collusion. pretend there was never any contact whatsoever in the last year or so. How would YOU react if I told you that the US hires company with K.G.B links to guard Moscow Embassy. A no-bid contract. Can you imagine Putin accepting US security at their embassy in United States? This is absurd but the Trump supporters will find a way to once again excuse it. GOOGLE and search results. No one will deny this as fact. NO ONE!

    • mcgcapital says:

      What’s this got to do with trading?

    • Holly Silver says:

      Everything! My premise is that the extreme corruption and Mueller charges will cause a major disruption in any spending incentives being passed. The market is stretched in anticipation of stimulus packages. No package, market adjusts accordingly. I keep getting the same arguments even as I gave clear reasons. Whether these reasons pan out is a different story. I stated in late 2015 that the consumers health has never been better with proof of drawdown in debt and increase in savings along with a huge gain in discretionary income. You don’t have a crash when the market was already very low relative to future spending momentum.

      Once again we shall see if my fundamental analysis coincides with the market behavior.

      I still see more upside possibly thru next week.

      • lunker1 says:

        OK we get your point no need to make it several times a day

      • Lee X says:

        Thx Gary
        Consider me informed

      • mcgcapital says:

        When you talk fundamentals it’s worth a read, but the politics are only loosely related to it and it dominates your posts. Comes across as biased. With or without anything happening to Trump, the stimulus package has been over egged and that’s the key point

        • Holly Silver says:

          Who isn’t biased? In technical or fundamental readings? Silly to even debate this. TONY saw a crash in 2015. Was that due to bias? You bet! When impeachment possibilities exist it should be included in stock market reaction. Did the terrorist attack on 9/11 affect the market? I am only using what’s most likely to occur and extrapolating timing and degree of affect. Never said it was infallible or even on the right page. The market determines these things. like everyone else I try to make best guess possible. A Mueller charge that implicates trump doesn’t have to include immediate reaction by congress. The market will decide if there is going to be a major disruption by it’s reaction to news. I trust mass market behavior over anything I expect. I will once again reconsider (if) market goes against my assumptions.

  19. purplember says:

    Tony, what’s next pivots below 2566

  20. phil1247 says:

    kvilia

    CL………. may have more swwwwwwwwwwwwwooooooosh coming but
    with number coming up i am taking profits on half DWT now
    good luck to us !

  21. fenster6 says:

    covered 3/4 of my shorts on the morning dump, but I am greedily waiting for 2540 for the rest.
    GLTA

  22. Looks like 1 more up and 1 more down to finish

  23. Lee X says:

    Nice job Tony
    Thx sir

  24. phil1247 says:

    asa

    re GE…….. dont know if you saw my post yesterday
    if GE went to zero … dow only down 200 points
    GE is a non issue ……..only of interest to those who hold it and
    are hoping for a bounce to get out

    • fenster6 says:

      GE has 295,000 employees. A very big deal indeed.

      • phil1247 says:

        non issue re dow……… big issue to real world
        stock market and real world are 2 different things

    • asaraniti says:

      Yes I saw it thank you. Saw a round table on CNBC last week. Bottom line they have problems but they are leaders in a number of their units…. needs a re-organization. My thinking was taking a position off a technical 61.8% long (..a capitulation bottom on heavy volume…if it coincided with a minute iv bottom) Then minute wave v lifts all boats, GE rallies. With a tight stop and raise stop to a profitable trade and let it run or get stopped out.

      • phil1247 says:

        asa …
        ….. corellations?……….it hasnt lifted GE all year while SPX and DOW soar
        now all of a sudden its going to work ???????

        • asaraniti says:

          Yes I would only think about GE, because the difference is GE successfully tested a 61.8% LONG, assuming it successfully tested a a 61.8% LONG.

  25. allen kimble says:

    Some of you crash callers got one right today. What does that make you? 1 for 100. Well congrats! You should know that this sell-off is just about over. Enjoy the fantasy of bear markets and political side steps, because it all doesn’t matter.

    The SPX is almost touching the lower BB http://stockcharts.com/h-sc/ui?s=%24SPX&p=D&b=5&g=0&id=p41261861993 It won’t go much lower than that folks. It might get into the 40’s like Tony is suggesting but right here and now is when you want to load up for the ramp into the first part of December.

    And Yes seasonals have worked perfectly this year. Don’t be foolish!

    • chrisk44342 says:

      You can’t really make these kind of statements without knowing the kind of speculator you’re addressing. A day trader has an entirely different risk profile and goals than a swing trader vs. an investor. You also have to consider the context of the market, eg wave signifigance, before saying you will or won’t be bearish. For example, I agree a swing trader would be better off waiting for minute iv to end and go long. That’s probably too large a time window for a day trader.

  26. micky says:

    2556 st support, will see if it holds a bit

  27. Not much reaction from gold with a break of 2566.Ler’s see if they take the Dax up from here.It all seems to start over in Germany–rallies AND selloffs.Ira noted the Russell is riding the lower bollinger band.This tax bill is being rushed for a vote by Dec 22–or the Repubs might lose the Roy Moore seat in the Dec 12 election–AND the tax bill.That’s how close the vote is.Elroy’s EW sees GDX going to 24.60 in short order,then a selloff to 22 and a big rally thereafter.Me,I need to see 23.05 (20d)surpassed.Gold COT charts still unexciting,so this ho-hum price action not surprising.

  28. phil1247 says:

    es 2558 next target

      • phil1247 says:

        spx potential support for next extension long

        2556……….2544………2531…..
        ………..if 2531 ext .618 support fails
        support drops to…………………………………………………………………………………2486

  29. Observation…chart to show the significance of breaking 2561.75. Often when a 61.8% level is broken, the asset class will trade to the low anchor or starting point. What level is that? Tony C’s call. Interesting how 2 distinctly separate analyses come to a similar conclusion. Chart…

    https://gyazo.com/e6573e7df6f65fd5d0b21f705bafc5c6

  30. Good morning traders. In last nights post/chart, I showed the inflection point where the bull/bear case would dominate the morning session trading. I specifically mentioned watching /ES2561.75 as that level was my my bull/bear line in the sand….the low as I write this post is /ES2561.75. Notice how the trading had a downdraft to 2562.00 and found support at the 61.8% measured move LONG.

    Should /ES break 2561.75, it opens the door to lower targets. Should /ES defend this level, at a minium, there will be a 6 point rally to a new micro 50% SHORT which could lead back to retest 2561.75. Break the 61.8% micro SHORT and /ES trades back up to yesterday’s high. Note…if /ES opens >10 points that gap does not have to fill today. Notes/labels on last night’s chart.

  31. STEPHEN BARTLETT says:

    Every mkt is breaking down except the U.S. That means either the U.S is about to go up or U.S equity investors are the least sophisticated and are always last to any party. I am still short NDX. Will use any new high above yesterday’s high as a stop now. If we rally again now we will keep going up. Will be a minor profit if hit. HSCEI long stop has been hit. Small profit.

  32. NEWBIE says:

    Allen Kimble, hows that seasonality bs working?

  33. JK1987 says:

    tomorrow Nov 15: plan is to buy long on the gap down dips.
    that’s 4 gap down in 5 days.
    it would be a better bearish case if it would be a gap up to fill the gap of 258484.
    tonight futures pointing to gap down, forming a good case for short term bullish case.
    this gap down formation shows 259438 gap will be filled, hence one more last life to new ATH is probable.
    big Crash still is a must, cause it’s the Great Deflation. it’s the fractal, not a bull or bear case.
    looking at Nikkei, the formation shows a bottom tonight.

    PS. i sold the morning long position prior to the close.
    that’s the first long position i had in over 5 years. i did not trade any of the market for 5+ years until got the “calling” this summer.
    ten days ago, i got another “calling”, miracle happened.
    nothing belong to or come from me,
    all will be for serving
    Abba Father and
    His kingdom

    • fionamargaret says:

      Now Mahler is not known for his short symphonies, but do take time to listen to this…
      Claudio Abbado, the conductor, was greatly loved by everyone, and if you look closely, you will notice Pollini, Rattle and other musicians in the audience.
      Abbado had spent the last part of his life hand-picking musicians to form his Lucerne Festival Orchestra, and just as everything was nicely falling into place, he discovered he had cancer and his time was limited.
      Just watch the orchestra members’ faces…they loved him and gave him the strength to continue, even as he grew weaker.
      Another point I found interesting…Abbado was a total Mahler fan. Now you have to understand Mahler’s music was not even liked by his contemporaries, who thought he should stick to simple themes and instruments….cowbells, and singers in the backstage were…well..maybe inappropriate.
      But just as Abbado had his friends see the best in him, Abbado pulled Mahler to the fore, and give him the recognition he really hadn’t experienced….one good turn deserves…..x

  34. Seeking comments from the group on GE…in 2009, I had a chance to pick up GE at 5 and change and didn’t do it. If you look at a chart since the 2009 low, to the recent high, the pullback is over 50% and it’s way(?) to a 61.8% retracement. I am thinking about starting a position in GE when minute iv is over and enjoy a quick pop in the stock as wave v progresses. I believe the worst of the news is over when GE cut their dividend. The only missing technical tool is a capitualtion bottom on high volume. I will definetly pick up a few shares when intermediate wave 4 completes. Any thoughts?

    • fionamargaret says:

      I heard a few managers suggesting it was going to go the way of Westinghouse…

    • chrisk44342 says:

      My thought is why buy individual stocks at all if you are trying to time intermediate 4? Int 5 will be over before you know it and you could be stuck with an underperforming stock at the end of it.

    • purplember says:

      Asa, a few comments for you. i try to use fundamentals & TA for individual stocks. GE has a 5 star rating at morningstar, which means its a good value for next 2-4 years return. if GE stock went to 0, all the assets of GE could be sold for appr $27 per share. GE was poorly managed for several years: debt, pensions etc… once they show they have good plan, stock will rebound imo

  35. Good evening traders. Today was looking at vanities, crown and baseboard moldings. Anyway, this is what I am looking at, for the overnight session. You can see a micro set up on the charts, IMHO, that’s too small and has a lower probability of occurring. What has a higher probability is the measured move long. The 50% measured move long should/could trade during the European session and in the NYSE perhaps on it’s way to fill the gap. If you look at my post/chart a few minutes ag o, maximium pain for ticker symbol SPY for options expiration on Friday is, in the mid 2550’s. This data is of yesterays activity, so some “settlement” may have occurred today. Notes on chart….

    Bottom line /ES 2561.75…bullish above and bearish below.
    https://gyazo.com/77958a88b0d7f95b905387743820518b

  36. Allen…just as a FYI….Looks like there should be some downside activity through Friday. Could a great deal of these options been “settled” in some maner, of course. Chart…

    https://gyazo.com/81b43535e09a0d920a94e98f0cb3fd63

  37. bouraq says:

    Chart of the day is #EURUSD at http://www.tradingchannels.uk

  38. allen kimble says:

    The week before thanksgiving is usually bullish, so in thought of that, tomorrow should be an up day with the potential to be a very big up day.

    Don’t fall for the fear and loathing here. It’s bullish and that’s that.

    • exactly; ty for saving a few some $$. Major correction after New Years: right after I think

      • allen kimble says:

        Yes sir! You want to buy GOLD/GLD/GDX/JNUG around Christmas for the nice strong rally in the new year with the overall market going down quite big. However, now you want to short Gold until Christmas and buy Equities.

  39. fenster6 says:

    I added a lot to my shorts at the close.
    Lots of technical reasons that I wont bore you with and no doubt driven by my own bias of a toppy market.

    GLTA

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