Tuesday update

SHORT TERM: gap up opening, DOW +429

Overnight the Asian markets gained 0.8%. Europe opened higher and gained 1.0%. US index futures were higher overnight, and at 8:30 the PPI was reported higher. The market gapped up at the open to SPX 2649, dipped to 2639 by 10am, then rallied to 2663 by 11:30. At 10am wholesale inventories were reported higher. After reaching SPX 2663 the market became choppy, with a bias to the upside, after a drop to 2636 by 12:30. Heading into the last hour of trading the SPX hit 2665, then dipped to close at 2657.

For the day the SPX/DOW gained 1.75%, and the NDX/NAZ gained 2.15%. Bonds lost 4 ticks, Crude rallied $2.35, Gold rose $3, and the USD was lower. Medium term support is now at the 2656 and 2632 pivots, with resistance once again at the 2731 and 2780 pivots. Tomorrow: the CPI at 8:30, then the budget deficit and FOMC minutes at 2pm.

The market volatility continues. After a gap up opening on Monday the market rallied 50-points from Friday’s close, only to lose 40+ of those points in the last two hours of trading. Today the market again gapped up at the open, and again rallied 50-points from the prior close. Then after dropping 27-points the market, this time, recovered to post a higher high in the last hour of trading. Yesterday we posted a tentative Minor waves 1 and 2 at 2672 and 2586 respectively. This would suggest Minor 3 is now underway. But since the SPX 2586 low the market has been choppier than the 2586-2672 rally. Next couple of days should be the tell. Short term support/resistance the same as medium term above. Short term momentum ended the day above neutral. Best to your trading!

MEDIUM TERM: downtrend may have bottomed

LONG TERM: uptrend

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

About tony caldaro

Investor
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439 Responses to Tuesday update

  1. vivelaamo says:

    See you at 2791. Goodnight all.

  2. gary61b says:

    ES needs to tag 2660 but a drop to 2656 not so bullish.

  3. alexh110 says:

    Double hourly -D at today’s high: makes me cautiously bearish for tomorrow.
    Remain slightly overweight short.

  4. Holly Silver says:

    I went against historic arguments on earnings season producing the most upside movement in stocks. I rely on surprise Fridays. I also see a strange restraint in last 2 weeks. Today no different even though we are in earnings season. I bet long shot Puts again for the 20th. If tomorrow is a breakout event i exit. Engulfing Bearish reversal candlestick late in day. The 2 plus week tight wedge is once again running out of territory. It really has to breakout and immediately or it breaks down. Going against Phil and his bullish call it seems.

  5. pooch77 says:

    How many times is 2872 going get rejected?

    • That should be the last for the time being, pooch. We either sell of from here or gap up and over it tomorrow. I think we sell down, but like I said, this has been as tough a market to read as I have experienced.

  6. vivelaamo says:

    Mcg,

    I’m seeing 200 dma holding. Failure of any of the major US indices making a new low. Small caps remaining strong which is normally bullish. Trendline still has to break though. chart below from last weak was speculative and probably too simple but playing out at the moment. I can however understand taking short positions here with tight stops.

  7. lunker1 says:

    SPX and VIX both over the 20dma…the middle BB

  8. Both DJIA and SPX had the second MACD “left hand crossover” of the last 2 months a few days ago.
    Arguably, the “A” and “C” waves.
    Today, the NDX did the same, joined the pack.

    Imagine investing money (that probably has at least a couple of comas in it) on something so arcane.
    Amazing.

    Good luck to all.

  9. E says:

    Broke 2670. Even my primary analyst Dent says there will be a huge breakout if this line is broken. Exiting all short term puts. Buying a few uvxy puts.

  10. Page says:

    Friday will be BIG down day.

  11. phil1247 says:

    newbie
    boys want to trample bears into the close

    stay alert

  12. cn and newbie. You were both looking bearish. Does anything change your mind. I am shoet, looking to run for the hills though.
    Cn when does big down terminate

    • The last Big Down exceeded its minimum target. There has not yet been a clean Big Up. If this resolves in new highs without a BU it may be the first daily swing of any significance on the S&P without one. You can manufacture one by taking two or three daily bars of price activity together. But that isn’t what I use to enter long. I still have swing short position on. I would say that a close above 2678 on the Cash $SPX probably sees me go flat, and then reposition after some sort of PA that I recognize. At the moment, I think we are at an important juncture for the market … A big move one way or the other is likely to start from where S&P is right now at 3:33 PM EDT. This has been as difficult a market as I have ever traded since baout 3/23.

  13. johnnymagicmoney says:

    ascending triangle on the 15 min chart (S&P)

    it wants to break upwards

  14. E says:

    Also VIX is finally moving inverse to SPY

  15. E says:

    Seems like it will break up today compared. Chart pattern seems different from last two days.

  16. fotis2 says:

    There are more daily green bars than red ones inside the range past 14 days so UP it goes

    • phil1247 says:

      the daily trend in spx and es is up
      the question becomes
      do you want to be short in an uptrend ?

      • fotis2 says:

        The deeper the bias gets buried the easier it gets like Tony says” trade what’s in front of you”

        • phil1247 says:

          OTA

          objective technical analysis
          of spx and es ….
          momentum up …………………….bullish
          daily trend up………………….bullish
          above 18dsma ……………………bullish

  17. phil1247 says:

    2679.5 is next

  18. mjtplayer says:

    I know people are starting to get bullish again, thinking the “pullback” is over, but all I see off the lows is a choppy, overlapping mess of corrective waves.

    Should drift higher for a little while longer, probably into next week, before turning back down into late April and May – IMO

    • torehund says:

      Waves Get messy when the swell comes from different directions simultaneously. Blame biotechnology and its Shake and rattle prior to decision time for the interefence pattern and then the energy sector with oil at major inflection too. Great forces at play when deflation and inflation goes head to head in a battle. Also govs interfere AS some of the currencies are bound to Get hit hard whichever way the pendulum swings. WAR is the natural choice alongside Faltering systems. If economical collapse preceedes it, it may be averted. The there will be no excuses at hand for he prevailers, and they will have to go overboard.

    • tommyboys says:

      Careful with shorts here. Looking like markets could scream into the close today.

    • mcgcapital says:

      Agreed.. you’ve got to be mad to be trying to buy and hold here. Trends broken all over. Nothing wrong with longs with stops, although would definitely avoid buying into strength.

      Most on here are US centric, but it’s worth noting that the best years in this bull market were 2013 and 2017 which were years when all indices, including Europe and Asia, were consistently making higher highs. This time around they’ve already rolled over. If the S&P had the same profile as the FTSE or Dax I’m sure there would be way less people pushing the ongoing bull narrative.

      I feel like the last 3 weeks have been the counter rally when I look at these markets. FTSE has a downward sloping 200 day moving average less than 100 points away after a long period of consolidation last year. Plus near enough approaching the post sell off highs from Feb and March after a lower low in March. Stochastics overbought and running out of momentum last few days. This is where you pile on the shorts if you’re going to.

      Surprised S&P has lagged so much but guess it’s the barrage of bad news from Washington causing people to cut weights to the US. Think many are looking at it and thinking it’s 200 points off the high so has a long way to rebound, but that’s not necessarily the case. Price action suggesting we’ll not have the legs

      • tommyboys says:

        Actually it’s been the barrage of long awaited good news outta DC that’s caused this whole rally since Nov 2016. Will continue. Earnings around the corner.

        • mcgcapital says:

          I’m not trying to be political here, don’t care either way. Just that 2017 the political news was perceived stock market positive (e.g. lower regulation, lower taxes, higher business confidence) and this year it’s been stock market negative (e.g. tariffs, trade wars). It will definitely be feeding into how the big global equity funds allocate, rightly or wrongly

      • vivelaamo says:

        I just cant see it mate. Maybe its bias but I’m seeing US indices ready to explode to the upside in a parabolic move.

        • mcgcapital says:

          You looking at the inverse head and shoulder? That springheel jack guy was saying Nasdaq and Rut were already above the neckline and he thought SPX would follow, but not make much headway and fall back. Seems quite consistent with what’s happened so far. All I know is, FTSE has done 6840-7270 in 3 weeks.. clear 7300s and it’s probably back into bull mode.. but usually first hit on these inflection points see us sell off. Either we’re in a bear or we’ll dip from here then rally much higher.. but either way can see 7100 again before it’s decided

  19. mcgcapital says:

    Looks like a reversal coming.. short here with a stop at 2680ish is the right play

  20. mjtplayer says:

    Another failure for gold to break through the$1,362 resistance area and now it’s back below $1,347. Still in no man’s land….

  21. Holly Silver says:

    2673 held for two weeks. this is third attempt to break out. if it can’t today what are the implications if any according to EW technicians. 1 PM and so close but still not achieving goal. Bias seems to be a one way street. held on downside but can’t break out means nothing has been resolved. Nothing resolved yet proclamations abound. Shouldn’t we easily break that small ceiling if we are going much higher?

    I have 2720-2760 range as the final possible top but that too should be soon broken if we are in a bull trend. the testing at bottom was done multiple times. It usually sets up for an explosive breakout. time is running out once again according to my unofficial non-technical assumption.

    • Holly Silver says:

      Half hour later and it’s still not able to muster any strike. In fact the drops happen rather fast and easily while the market struggles to mount any offense. Sometime today i decide on placing Puts expecting 145 as minimum target and soon. Earnings? Market behavior indicative of a reversal from long uptrend.

      Anyone chiming in? Surely everyone sees this market react rather weakly. EW bulls what’s going on? Does this fit in?

      • Jack kendo says:

        according to aah, it’s w-x-y
        here is a chart from Cobra (one rank above oew in stockcharts public list) with aah’s count.
        next will be 3 of (3) down, rd3777 call it waterfall, others call it crash.
        i am a bull, i do not approve this count, lol

        https://gyazo.com/7c51e13200142e333cee2afa92780574
        cheers!

        • Holly Silver says:

          I see a 2 week old wedge pattern but being so short in time it can morph into anything. Is there any longer term indications? The move off 4/6 suggests a minimum of 2700. I guess i wait this day out. Before close I will decide if the bet is worth the risk.

      • vivelaamo says:

        Dow is currently testing down trend line for the 3rd time. Will break out and hopefully back test tomorrow or Monday.

        • Jack kendo says:

          vive, agreed.
          time to buy, don’t hesitate. buy with real money, not phantom as p*
          i don’t see you buying any for a month.
          go ahead buy and buy big, i hedge for you. ==)
          look at that, still “Extreme Fear”, Raymond’s Jeff posted this as one of his best tool.
          http://money.cnn.com/data/fear-and-greed/

          i am bullish.
          cheers!

          • vivelaamo says:

            I am long JK but I take positions with longer time frames – weeks to months. I’m an amateur trying to make a little bit of pocket money. Declaring that on a predominately day trading site full of professionals like yourself is pointless and no help to anybody.

  22. Can’t fight a bull market.
    I’m long.

  23. HYG has exploded through 86.Next stop is gap near 88.Nothjng bearish there unless…

  24. Mary773 says:

    DJIA +353
    CBOE P/C = 101.
    Rising prices amidst skepticism.

    • vivelaamo says:

      I don’t understand the bearishness. We’ve just had 2 fairly deep pullbacks and failed to make a new low on the second. Small caps are booming. Why do people expect more downside?

      • E says:

        I would say it is something on this order of severity: reverse QE + rate hikes + yield inversion risk + overvaluation + approaching longest bull market in history + falling demographic trends + innovation s-curve reversion to mean + geopolitical chaos (tradewars & wars). Catalyst for all this bearishness was initial strike of 200dma.

        • vivelaamo says:

          Raymond James suggest we are in a earnings driven bull market…200 dma has held twice!

          • E says:

            Unfortunately I believe we are in a paradox. The mirror of our current reality is the enormous upswing since 2009 even though earnings were garbage back then. Now that earnings are great, the market is swinging in the other direction. This is the result of the mirage “miracle” save generated by the central banks. In the long term it will likely result in the recession that was supposed to happen in 2008.

          • travis01 says:

            I’ve read a lot that earnings should drive upside growth due to all of the noise now baked in and expected 17% earnings growth. I pretty much agree though before warnings maybe a lil more downside. Who knows this week…

      • Mary773 says:

        The news is relentlessly negative. The positive economy with low unemployment is deemphasized while the media focuses on the impending trade war/the impending Middle Eastern war/the impending impeachment/the impending Apocalypse. Significant lows since 2009 have been accompanied by sovereign defaults and government shutdowns and devastating natural disasters and all kinds of horrifying scenarios of certain doom. This is the umpteenth time the public has been manipulated into self-destructive pessimism.

        Then again, eventually Newbie will be right. So will Prechter, who has been calling for an imminent crash for decades. The preceding assumes that Newbie is not Prechter, which might be a false assumption.

  25. E says:

    No man’s land. Splitting everything. Buying calls on stocks through earnings. Hedging with UVXY calls. Buying QLD calls. Hedging with longer term QQQ puts.

  26. phil1247 says:

    gary lewis

    tide has turned for bonds
    notice series of higher lows broken today
    auction at 1pm of 30 yrs
    now at 18dsma
    prob get a bounce from there but now i am looking to sell rallies

    ZN had bull trap sprung today
    outside day up yesterday and now the low is taken out

  27. fionamargaret says:

    Oftentimes one can determine the sequence better by looking at the 3x….
    SPXL down to 29
    SPXS up to 44
    Long JNUG, NUGT, UGLD, UWT, ERX…bunches higher…

    All the other symbols in earlier Updates still viable….If there is a company you want to know about, just ask….

    • fionamargaret says:

      FAZ up to 15.5……poor bankers, my heart bleeds….

    • fionamargaret says:

      JNUG had a triple top breakout yesterday with a price suggested of 18.5…BUT I think it is just entering a wave 3, which would suggest much higher than that….
      NUGT had a double top breakout on 26 March with a price suggested of 37…again I think it is just starting a 3 wave…..much higher

    • hooloo1957 says:

      Amzn

    • davidmlamos says:

      Hi Fiona: Thanks for your work and music. Can you please take a look at OLED and give me a count. It was a darling of momentum up and has now lost about 50% of it’s value since the recent high. It was closely linked to aapl but has suffered far worse than it’s auspicious customer.

      • fionamargaret says:

        OLED is interesting David…says down to 75 BUT if it goes higher by 1 dollar, then it breaks higher, so I would keep it, watch, and remind me to look at it again…
        AAPL is down to 149….

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