Thursday update

SHORT TERM: higher open, pullback, then higher again, DOW +94

Overnight the Asian markets gained 0.7%. Europe opened higher and gained 0.9%. US index futures were higher overnight as well, and at 8:30 weekly jobless claims were reported higher. The market opened 5 points above yesterday’s SPX 2727 close, moved to 2737, and then began to pullback. By 10:30 the SPX had hit 2726, then bounced to 2736 before declining to 2723 by 1:30. After that the market rallied into the last hour of trading. At 3:30 the SPX hit 2740, then dipped and bounced into a 2739 close.

For the day the SPX/DOW gained 0.40%, and the NDX/NAZ gained 0.45%. Bonds gained 7 ticks, Crude lost 80 cents, Gold slipped $3, and the USD was higher. Medium term support rises to the 2731 and 2656 pivots, with resistance at the 2780 and 2798 pivots. Tomorrow: monthly payrolls (est. 222k) at 8:30, and wholesale inventories at 10am.

The market opened higher today, hit SPX 2737, then pulled back before hitting 2740 in the last hour of trading. We can now add two small Minute waves to our positive scenario posted on the hourly chart. From the SPX 2533 low: Minor 1: 2754, Minor 2: 2698-2789-2647, Minor 3: 2732-2702-2740 thus far. Another potential three of three situation has arisen. Let’s see if this one sticks. Short term support is at the 2731 and 2656 pivots, with resistance at the 2780 and 2798 pivots. Short term momentum ended the day overbought. Best to your Friday trading!

MEDIUM TERM: uptrend probably underway

LONG TERM: uptrend


About tony caldaro

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295 Responses to Thursday update

  1. micky says:

    small stuff I got 1st resistance at 95 area, maybe a small pb there, should we gap up past it monday 2nd is at the low 2800 right now, after that previous ath area,depending on how long it takes to get there.

    • micky says:

      these are not fibs, but they usually dont differ much,The problem I have with fibs is one is not always certain where to place them.

  2. Bud Fox says:

    One question, we should all be asking is….When is the next Recession/Depression coming?

    • chrisk44342 says:

      According to OEW, not for many years will we see anything major. According to EWI, just about every year. As Tony so succinctly put it, the market is in a bull the great majority of the time.

      • Bud Fox says:

        Tony, very likely correct. Last Bear was 2002, and 2007-09
        So, just from a time analysis. I cannot, be so confident,
        Then again from 1973-74, was the big Bear, that, I recall.
        But, from 2009 thru 2018, is a long time span without a Bear.

        • Bud Fox says:

          Looking at 9 years from the 2009 Low….just something to watch/monitor.
          Yet, looking out a bit, in time. I can see a very major/critical SP price top.
          Given, we still have 8-9 months left in 2018. The risk is, thee top will be
          in Sept-Oct 2018…

    • mjtplayer says:

      Historically speaking, we’re due. But, there’s been so much interjection by central banks globally regarding rates/QE that they’ve probably delayed the next recession – which means when it does come it will be deeper than if the central banks were to just leave the business cycle alone.

      Cycles over the past 35+ years have become longer, due to more interference by governments and central banks. They seem to think they can eliminate the business cycle with their manipulations, but when we do get recessions they are stronger and deeper thanks to these constantly failed attempts to manipulate the economy into nirvana.

      Here in the US, the next recession will be sometime between 2019 – 2021 IMO, but in Europe it will be much worse and much deeper as they come to grips with higher interest rates. The ECB has kept the EU governments on life support for years now via QE, but they are totally trapped. End QE in Europe and watch interest rates on government debt explode higher – like holding a beach ball underwater too long

  3. hohoho598 says:

    For those who are so congratulatory, apologetic and sympathetic to those who have made/lost money, lets face it no one really cares. If it were so, those that have made money would help out those who have lost…right??

    LOL, big “V” wins again and who is Trump? Do I hear a distant echo re trade wars. Charts Rule!

  4. stan911 says:

    A few are saying we go for 2450 end target I don’t think so not yet anyway till new highs are made. EW theory we finished wave 3 now in 4 . Trump election low was 17479 and high 26707 wave 4 should retrace 38.8%
    38.8% of that is 3580
    26707-3580=23127 bingo the low is in going for wave 5 and I said a while ago. I am in the camp that we go and backtest 2595-83 then to new highs before we test 2450 which is around 22800-600. As I’ve mention before spx has gaps at 2810,2828,2835,2852 and 2875 now in saying all this I’ve got caught out chasing the short to 2595/83 does it come I don’t know but thing is for sure the low is in.

  5. Holly Silver says:

    Two times I used external events to dictate trades was election period and trade wars. They are related and I still see a terminal move when the trade wars get heated up. Anyone suggesting a full blown war isn’t going to hurt? I was surprised on short sighted market behavior. knowing trump it seems impossible he doesn’t push back with his auto threat. But i guess the EU will take it’s time on reacting but react they have to. their survival depends on it.

    I don’t see a terminal move to at least 2880. if external news stays calm it should be there by end of next week. Outside chance we hit the final mark of 2988 on SPX in next month or so. When trade wars cause only an intra-day one percent drop with small consolidation days that tells you the market is in some sort of final move.

    • stcoleridge says:

      Sorry, who was short sighted? You or the market?
      Now you think the market will be up a 100 points next week.

    • tommyboys says:

      Trade wars? Where’d you hear THAT? Oh yeah stop listening to hysteric CNN fake news. NO trade war – none – just like no Trump victory implosion, no debt ceiling crisis, no tax cut drop, no Y2K collapse etc… ALL NOISE by fear mongering communist media who want to see the US become Russia controlled by the few. The propaganda controllers count on your emotional response. Heed it at your peril…

    • If you don’t see a terminal move to 2880, why do you think it will be there by the end of next week?

  6. blackjak100 says:

    Internals were relatively weak for a +1.74%. However, the NYAD line is not far from its ATH. With the Fed expected to remove punch bowl even more aggressively in the coming months, I wonder if we’re going to see a wave 5 ED play out to end bull and we are currently in just wave 1. Why?

    ED’s contain deep corrections which would coincide with Fed removing punch bowl, but it would also explain a new ATH for NYAD at the end of wave 1. should see a divergence from it in wave 3 & 5. All speculation of course, but either way it suggests a new ATH first matching OEW expectations for niw

  7. Bud Fox says:

    TC2000 charting system,, I have is free and works rather well.
    Suggesting, if your looking for a stock/index charting system
    that is free. check it out…TC2000 ver 18.0.6626.29703

  8. Mary: Thanks for the excellent insights and market calls, although I didn’t understand most of your abbreviations, such as “dtl”.

    • Mary773 says:

      Mea culpa.

      BB = Bollinger Band
      ATH – All time high
      dtl = down trendline
      C/H cup with handle

  9. phil1247 says:

    forget about anything fancy
    KISS principle

    look at iras sp500 discussion
    yesterday we had a daily uptrend……. higher highs and higher lows …. bullish
    above the 18 day sma ………………………………………………………………….. bullish

    so the question becomes
    do you want to be short in an uptrend ?
    only you can answer that question for yourself

  10. Tony: Kudos on your 3 of 3 call and your wave count in general. Things definitely look impulsive now. Phil complained about low volume but most of this bull market until the last 6 months has been on low volume.

  11. Lunker:
    I have a couple of comments to make about your earlier posts:
    1. Lee X did only refer to after the fact posts about trades. You decided to extend his meaning to all trades, including before the trade posts.
    2. I think CN made a good point about DH having a book out that explains his methods and also about his chat room. He did not say Phil1247 should not post or explain his trades. But I don’t think it is possible to learn something like the DH method just by reading Phil’s posts. I have tried that and it requires too much trying to read between the lines and too much extrapolating from examples. It is necessary to at least learn the basic principles first before you can expect to understand Phil’s examples or those of other posters who use the DH method.

    • Thank you, egeorgeschaeffer

    • Thailand Hawaii says:

      Yes, the DH trading method is very difficult to understand. One must check the Addict site out and still it is not an easy method. But, as I can tell you from trading for 40+ years and following this wonderful site for many, many years, I have not found a method that produces big profits like the DH method. But you still need daily help from someone like Phil or ASA to help you master the system. We are so very lucky to have them here and am so glad, that they are ignoring the bashers. Those that bash are just to lazy to learn something new. I am sure that Tony is more than happy to have them here, as DH is a wonderful adjunct to OEW. THANK YOU PHIL AND ASA.

      • phil1247 says:

        wow doc !

        that was really nice…
        thank you and glad to help

      • Bill Manscoe says:

        It stands to reason that since OEW and DH are both based off of the Fibonacci number series along we their own separate other rules you would see a great deal of overlap at least on a longer term time frame. Glad to have all the posters for their market related posts. Politics not so much

      • Thank you T.H. Glad to hear you are following DH.

    • lunker1 says:

      Lee said “stop posting trades”

      Lee X on March 9, 2018 at 8:18 am
      Posting trades after the fact is self serving
      Stop posting trades
      It clutters this place up

      • Lee X says:

        Dude In sorry I triggered you with that I really am.

        Lunker and everyone one else post to your hearts content as long as its…..

        No more than 3 posts during mkt hours
        No posting of trades
        No political posts

        Hey maybe you can get Tony to change his rules but seeing he’s recovering from an life altering medical situation maybe you can wait til Monday ?

        In the meantime y’all can chat with Crusty haha

        • lunker1 says:

          The “Lord of the Flies” I’ve been here longer than you so I’m going to gang up and demean Phil approach that some have been taking is low. No personal attacks was one of the rules too.

          • Lee X says:

            Valid point

            Phil’s received some major crap this week by known and unknown posters.
            If my comment piled on that’s not cool and I’ll back off

            He also receives a lot of support so I certainly don’t want to hinder ideas being exchanged .
            Im old school with the trade posts haha but who am I to get in the way of what the majority appreciate.

            Thx Lunker

            • lunker1 says:

              👍 I was going the idea exchange, majority appreciate, fibs are fibs “in conjunction with OEW” flavor but of course its Tony’s word first. I was just trying to break up the pig pile.

          • fotis2 says:

            YOU have been trying to get info on how DH works works free of charge from Phil relegating the site to where now 80% of posts/daily deal with question/answer DH system.
            YOU for years used to crap all over anyone who posted more than 3 but now that you doing it its OK.
            So get of your moral high horse ,stop pointing fingers at everyone, stop sponging off Phil,go join DH site and find out if it works or not for yourself,that’s what I did.

      • Lee X says:

        Dude In sorry I triggered you with that I really am.

        Lunker and everyone one else post to your hearts content as long as its…..

        No more than 3 posts during mkt hours
        No posting of trades
        No political posts

        Hey maybe you can get Tony to change his rules but seeing he’s recovering from an life altering medical situation maybe you can wait til Monday ?

        In the

  12. Minor 1 was 220 points. Minor 3 equals minor 1 at 2865 and 1.618 of minor 1 that’s 3002
    So In a 3 of 3 just enjoy the ride up

    Good luck all

  13. fionamargaret says:

    Congratulations on a cracking good call Tony and also for leading us to this point….
    This surely is the best medicine. xxxxxx

    Well done CN, Mary and ….well, everybody…super stuff …now, about dinner….beggars can’t be choosers xx

  14. Great call, Tony…..As I mentioned yesterday….I’m in awe on your 3rd of 3rd Wave Call….super!

  15. fenster6 says:

    great call Tony and the others who saw this coming.
    I am clining on to a few shorts having been blasted out of most.

    being short a thrid wave comes before a root acanl in pain IMO

  16. Holly Silver says:

    Irrational exuberance? Time will be the judge. I hope this sucker hits the absolute top most projections. Mine is SPX of 2988. The street decided the world will accept trumps tantrums for now. I know one thing. If trump hits the EU they have no choice, regardless of how weak the WTO is to fight back. Since the WTO has 90 days to decide I suspect the market assumed they will do nothing till then. Count on a glorious rise in this final push up. It is coinciding with the final phase of Mueller’s investigation. Perhaps both will come to a head together.

    As usual i was wrong when confronted with obvious market choice. they decided it will all end well. I can guarantee in this case they are dead wrong. Trump will be emboldened by this lack of cohesive push back. With Mueller’s report and WTO being forced to fend for it’s life a clear political and economic crisis is dead ahead. Mueller nor repercussions of tariffs will go away.

    But for now clear skies ahead. The EU will quietly get it’s act together. My timeline of the final mega bull to end in 2019/2020 is intact. Just as my rants were over the top a year ago, they seem tame in comparison to reality. I was/am right about trump regardless of trolls and bots distortion of that reality. lets see if the next greater depression is also a given. We all agree all time highs should happen over next 18 months or so. Enjoy the show.

    Once again caught betting with my emotions and assumption market couldn’t ignore ramifications.

  17. NEWBIE says:

    Negative divergence is here, partys over, next is C wave down.

  18. Lee X says:

    Call it what you want, I call it pivot time

    Great call Tony and nice job on the BU CN

  19. vivelaamo says:

    Sounds like Newbies pal Jimbo must be losing money big time. Amazing how bitter some people get on here whenever we see a rally. Quite sad really.

    At least my demo account is up.

  20. torehund says:

    WROCK it into the weekend, thanks Tony and the fabulous gang in here 🙂

  21. lunker1 says:

    es fib targets

    from 2647 low
    1.236 2851
    1.382 2889
    1.618 2951

    from 2681 low
    1.236 2755
    1.382 2768
    1.618 2789
    2.618 2876

    from 2701 low
    1.618 2750
    2.618 2792
    4.236 2860

    resistance at 2789-92 target cluster?
    prior B high is 2789.5

    • lunker1 says:

      forgot one
      from the 2567 low
      2.618 2737
      4.236 2865

      got another cluster at 2860-65

    • Mary773 says:

      The daily upper BB is also 2789, and since 1/26 SPX has been reversing every ten days which would be Monday (or early Tuesday with a bleedover). Conversely, Naz and NDX are gapping out of C/H formations into ATH with retail sentiment still pessimistic by many gauges. I favor long (preferably) or flat (alternatively) but not short. Here’s the thing: SOX just recently challenged the previous ATH (2000), hesitated, and took off. The most recent time that happened was 1/99, and SOX went vertical. Maybe significant. Maybe not. Just considering the upside here could be unusually large. In any event, there definitely is resistance at 2789.

    • lunker1 says:

      add 5 to these numbers for the new ES contract

  22. 123 abc says:

    Tony: I wonder if you can help with an educational question in regards to a Double Top formation; any thoughts appreciated.

    Q: If the second peak in a Double Top formation comes within +95% of the first peak on a candlestick chart, but exceeds on a line chart; which of the following options is best suited as the count?

    • tony caldaro says:

      unknown, without knowing what came before all that action

      • 123 abc says:

        Thank you Tony, the overall context is a downtrend.

        Any guess in regards to which of the aforementioned options, or other, is likely to label this?

    • jobjas says:

      Internal wave structure is more important . In option1 A to B appears to be 3 wave (corrective)
      The caveat is a truncated wave
      That is the reason to look at the larger wave for 5 waves.

  23. I have to run out to mean some friends for lunch, but there is a nascent intraday Big Up forming. Time will tell, time will tell …

  24. mcgcapital says:

    Congrats everyone who was long, just remember to lock in some profits in case this goes back down as I still don’t think new highs are that clear cut here.

    I got out on the break of the trendline 2760, 40 point loss. Can’t really see a trade set up here now for shorts, but doesn’t feel right to me to be long either.

    Part of me thinks this could turn back down in a random place because most shorts were looking at the 2730-60 area as resistance to sell into and now most of us are out or covered. What you need for a proper impulsive advance is sticky money.. not just short term traders. I’m not convinced institutional investors are allocating more to stocks right here so this is probably mostly traders moving price which means it’s less likely to hold.

    See if it gives some back by the close as that will be a sign as to whether it’s likely to carry through into next week IMHO. Interesting that Europe hasn’t really followed this move, it’s purely a US rally post payrolls

    • alexh110 says:

      I went back to a neutral hedge at 2745.
      Not comfortable going long here either: too overbought for my taste.

  25. vivelaamo says:

    Great call Tony, Tommyboys, CN and anyone that didn’t get spooked by the recent moves

    I could never get bearish SPX/DOW while RUT was so strong. Still Time to take some profits Just in case it’s a double top…

    Enjoy the weekend all.

  26. micky says:

    have resistance from another 10-20 points up still, so i wont short but Im off for some fun.Ciao all and dont grow old staring at the pc.

  27. Tony … a big up Kudos on your “3 of 3” call! I think you have done a masterful job of counting this rally since the 2/9 low.

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