Tuesday update

SHORT TERM: volatility continues, DOW -345

Overnight the Asian markets gained 1.3%. Europe opened higher and gained 1.4%. US index futures were higher overnight, and at 9am Case-Shiller was reported lower. The market gapped up at the open to SPX 2668. The SPX had closed at 2659 yesterday, after a huge 71-point rally. At 10am consumer confidence was reported lower. By 10:30 the SPX had pulled back to 2653. Then it rallied to SPX 2675 by noon. After the market pulled back to the lows of the day around 1:30 bottom fell out. By 3:30 the SPX had dropped to 2596. That’s decline of 80-points in 3.5 hours on no news. After that the market rebounded to SPX 2615 before settling at 2613.

For the day the SPX/DOW lost 1.6%, and the NDX/NAZ lost 3.1%. Bonds gained 17 ticks, Crude lost 90 cents, Gold dropped $7, and the USD was higher. Medium term support returns to the 2594 and 2575 pivots, with resistance at the 2632 and 2656 pivots. Tomorrow Q4 GDP (2.8%) at 8:30, and pending home sales at 10am.

A wild two days in the market, and it’s only Tuesday. After a huge gap up opening on Monday the SPX soared 71-points. There was some follow through this morning as the SPX tacked on another 16 points to yesterday’s close. Then Tech started to weaken, and weaken, and weaken some more. Eventually Tech gave back all of yesterday’s gains and even made a lower low than Friday. The rest of the market followed. Nevertheless, it looks like the market is finally getting close to ending this Intermediate wave iv correction. Not there yet, but daily RSI divergences appear to be setting up again. Best to your trading!

MEDIUM TERM: downtrend

LONG TERM: uptrend

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

About tony caldaro

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321 Responses to Tuesday update

  1. Jimbo says:

    That spx quarterly chart looks pretty doesnt it……


  2. fxaprendiz says:

    Question for you EW experts…
    I’m reviewing a site listing the EW rules and it says regarding a w-x-y-xx-z correction than the wave Z cannot be a zigzag Y is a zigzag. It’s that rule right?
    I’m asking because the SPX 2802-2582 downmove is clearly a 3-wave structure which can be labeled as zigzag, and this wave would be the wave Y in my new working count.
    If then Z cannot be a zigzag because of this, then what are the shapes left? Impulse and Ending Diagonal? Even a triangle?
    Thanks so much in advance for any reply. I know most of you must be out already enjoying the holidays. Happy holidays btw!


  3. fxaprendiz says:

    What’s the saying in here? “Project, monitor, adjust”?
    I’m already adjusting my count for this Intermediate wave 4 we’re in since end of January. It seems the break of the 200dma has been delayed for next month. If we are not done with Int 4 yet then it’s turning into a Complex correction instead of a Flat, its subwaves can be WXY so far instead of ABC, and the wave since Monday can be labeled as XX, to be followed by wave Z down.
    If this count is correct then Monday we started a new daily cycle (time wise) as well, if so we are only 4 days into this new cycle, and it’s probably going to be as short as 20 trading days.
    For this count to pan out SPX needs to stay below the 2802 high, probably retracing 61.8-78.6 of the Y wave.


  4. fotis2 says:

    Praying for those less fortunate than us Happy Easter to all of you.


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