Tuesday update

SHORT TERM: gap up opening then selloff, DOW -425

Overnight the Asian markets gained 0.8%. Europe opened higher and gained 0.1%. US index futures were higher, and at 9am Case-Shiller was reported higher. The market gapped up at the open to SPX 2682, ticked up to 2684, and then started to pullback. The SPX had closed at 2670 yesterday. At 10am consumer confidence and new home sales were reported higher. Just past 11:30 the SPX had dropped to 2661, closing the gap and turning negative. Then after a rally to SPX 2672 by 11:30, the selling accelerated. At 2:30 the SPX hit 2617, the low for the day. Then the market rebounded to close at SPX 2635.

For the day the SPX/DOW lost 1.55%, and the NDX/NAZ lost 1.90%. Bonds slipped 3 ticks, Crude dropped 75 cents, Gold rose $6, and the USD was lower. Medium term support drops to the 2632 and 2594 pivots, with resistance now at the 2656 and 2731 pivots.

The market gapped up at the today. Which is nothing unusual these days when considering all the gap openings during the past few months. After running up to yesterday’s high, 2884 v 2683, the market headed south in a hurry. At today’s low the SPX had dropped 67-points, in 5 hours, on no negative news. It must be a correction. Today’s drop increased the probability of the double three scenario posted on the hourly chart. This suggests a retest of the February/April lows should end this Intermediate wave iv correction. Levels of interest, noted over the weekend, are SPX 2586, 2554 and 2533. Short term support drops to the 2632 and 2594 pivots, with resistance now at the 2656 and 2731 pivots. Short term momentum hit extremely oversold at the lows. Best to your trading!

MEDIUM TERM: downtrend

LONG TERM: uptrend

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

About tony caldaro

Investor
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357 Responses to Tuesday update

  1. Holly Silver says:

    Momentum target from beginning of year stands at 3.11% on the 10 year note. We are now at 3.03% I suspect we get real close to that target. if it breaches it we could go a lot higher. As long as the 3 year is hovering at or above 3% pressure on equities will still be there, at least till the market absorbs the new level. fear is always it moves too quickly higher.

    How the equities market end is another important marker for me. The shallower the move today the better for decision making.

  2. alexh110 says:

    Chance of a decent rally on ES here, perhaps backtesting 2680 or higher?
    Has an IHS reversal pattern and hourly +D.

  3. Gary Lewis says:

    Closed TLT puts. My cycle indicator is indicating possible bounce coming.

  4. Jack kendo says:


    bullish hammer!
    cheers!

  5. llerias7 says:

    NYSE SAYS SUSPENSION DUE TO PRICE SCALE CODE ISSUE; ALL OPEN ORDERS IN THOSE SECURITIES CANCELED
    09:45 – 25 apr 2018

  6. gary61b says:

    ES 2620 was the 61.8 long setup on the 11-34 wave, target at 2640.25

  7. lunker1 says:

    2613 is smack in the middle of Tony’s pivots

  8. lunker1 says:

    2717 was a kiss of the upper BB.
    The lower BB is 2581.

  9. alexh110 says:

    Have been rotating some of my shorts into longs today to lock in gains.
    Hourly +D gives a reasonable chance of a rally into the end of this week, then more downside next week.

  10. I’ve ben posting analyses comparing the/VX and /ES and how /VX is taking over the market. DH drew up one of the latest comparisons and I thought I would share that with you. In this case, just as /VX tests it’s 50% LONG, /ES tests it’s 50% SHORT.
    https://gyazo.com/92732489cb949112b107bb0baf75f62a

  11. GDX keeps bouncing off 20 d, 22.44,but MOST of the time a break of the 10d (22.64)leads to more selling-unless the 10d gets recaptured quickly.SPX can’t even stay positive for more than 30 seconds.DJT is not playing along–a slightly hopeful sign for a counter rally of some kind.A lot easier for the market to sell off now though–than go up.Good luck all.

  12. phil1247 says:

    everyone must have panicked at the open and sold
    all three broker sites work great again

  13. E says:

    Maintaining 2450 target week of May 11. C wave of A,B,C or Y wave of double three.

  14. 2612 is the B-wave low of a 4th wave flat, the fifth impulsive will take us to 2590 today.

  15. Holly Silver says:

    For one of my two scenario to work we have to close only slightly higher or lower before the final leg down to what I think is the 1st major bottom. It could of course fail mid-day and drop like a stone but that scenario seems unlikely. I still see a test of 258 area at a minimum but more likely low 250’s followed by a decent rally, and then the final plunge. EW chartist confirmed one of their scenarios is in line with my long standing assumption. Love it when i get corroboration from other methods. Now the market must behave. the slightly harder part. Good luck all.

    • Ashley says:

      Nothing has been resolved yet with EW but above the 2656 pivot Bears are in trouble… We are in a potential wave 4 of this decline but thats only confirmed with 5 down and a new low… Bulls have time on their side with big rising MA’s… Im expecting ZERO resolution today at least but Im not the market and we are in a dangerous place for either side… Best to just watch the rest of this week IMHO…

      • Holly Silver says:

        If we close at marginal levels from yesterday’s close my confidence grows. I got out when down about 10 SPX points because the move looked like it was over for now. been very lucky in reading the daily movement of market these last few days. I get in and out so far without missing any big moves. I used to sit it out figuring the worse case scenario is another 3 days for my first bottom to hit but since i have read this market so well i decided to gamble and skip the deterioration of options. IF we break down below 2614 today we could see a deep drop but I give those odds less than 20 percent. Market behaving in an orderly fashion so far. that is also a tip-off for me that the final plunge hasn’t happened yet. This last leg down should be the steepest for a one day event. I am in an unbelievable streak and hope it lasts another week. I hope today doesn’t disappoint.

        • Ashley says:

          Donno much about options but there is some strong support here and not far below, Ive heard 2590 here and that would be into support, I have the downside at 2575…. Bulls are on the long term trend line riding it along and the bears have some strong resistance above…. Best to wait for a break out of this thing either way and try to catch the big move…

    • fionamargaret says:

      2594 and then 2532…..and I still have oil 80/100 (UWT).
      I think we go through the 200…and ultimately go to around 2200…

      • Ashley says:

        All the Bulls really need to do is ride the long term trend line out of the Triangle, drop the $$$ and bonds a bit and activate “The Presidents Working Group on Markets” affectionately known among Bulls as the PPT, They call it a “melt up” as in slow roasted Bear meat on a skewer…. Just sayin .)

  16. cj32 says:

    Cr.to CBZ

  17. phil1247 says:

    bears running back hit hard at the 25 yard line
    did the ball come loose ?

  18. looks like wave 4 up with 1 more down to finish this correction

  19. phil1247 says:

    gary .. above 2643 i have a magnet at 2657

  20. S2 says:

    After digesting everything, I see similar big picture probabilities as Tony from SPX 2873, but I’d add more weight to the bear market scenario. Triangle OR combo ABCs OR bear market 1-2-1-2 (yes, I recognize Tony tends to label bearish moves as ABCs even though they can be comprised of 5-wave moves).

    What separates the 3 scenarios? On the downside, even the triangle scenario could test the SPX 2575 pivot (around 23.3K Dow) so nothing is eliminated above the 2560s. On the upside, I’d say the triangle C-wave or combo X wave or 1-2-1-2 wave could technically extend further above 2717 as far as 2801. However, given various factors including time, interest rate levels, moving average convergence, MACD/RSI mid-line tests, VIX lows etc, I’d say anything above 2717 at this point would virtually eliminate the bear market count. Not to say a bear market cannot start later this year.

    As an educated guess, I’d say SPX will test the 2594 pivot at a minimum and likely the 2575 pivot followed by a bounce back near the 2632 pivot at which point all 3 scenarios are still alive and we’re all still left guessing. In that situation, I think a break much above the 2656 pivot or below the 2575 pivot will give you the next 100-150pts and the likely winning pattern/count. Good fortune.

  21. phil1247 says:

    Lee

    Re : CL

    support cannot be confirmed as of right now
    we are in no mans land ….

    ie ….. no trade land

  22. phil1247 says:

    ZN
    10 yr note futures hit target overnite

    now we see whats what
    bounce or go thru target ?
    everything up to now was just fluff
    i am out of all PST as of yesterday
    but still holding TBT cuz ZB has not yet hit target

  23. traderlucas says:

    Hi all from Vietnam. Europe, china, russia.. are in down trend already. Will the US pulls the world up or the world will push the US down? I don’t know, but still bet that spx will fall to 2550s, from 2690s. Hope you trade well..

  24. exabpilot says:

    The recent overlapping flat wave from April 20 to the morning of April 24 was .38 of the 57 point drop from 2717 to 2660. It could be a B wave or more likely it was a wave 2 . IMHO wave 3 is underway.

  25. Holly Silver says:

    I still see 250’s as the FIRST bottom but not the final one of this drop. In fact it looks like it could go as low as 230’s. Love those coincidences like 10 year note hitting 3 percent. So trade wars and rising rates have no affect on the market yet I made some very good money even as I proved correlations up the ying-yang. I wish we had actual trade comparisons these last 2 plus months.

    So why am i seeing so many split bullish and bearish forward looking posts? Is EW bipolar?

    • mcgcapital says:

      This drop is about yields which are definitely relevant to stocks.. too much leverage, rising yields are a problem. Trade wars are largely an irrelevance.. they only matter if they escalate significantly which has to be the lower probability outcome.. Trump and China aren’t stupid, it’s just posturing. If the market sinks from here it’s more than likely got nothing to do with trade. Try valuations, peak growth, rising rates, earnings outlook not as strong as first thought and falling liquidity as your reasons

    • torehund says:

      Possibilities ar bipolar if markets are not trending, so stack up With some Lithium for now✌️Happy when it resolves, waiting is painful.

  26. cj32 says:

    Cr. CBZ for all bearish and reasons, expand.

  27. Symmetry has this all over by Monday

    Will see

  28. stockop says:

    appreciate it tony.

    running/symmetrical triangle complete at the lows today is a valid count as far as I can tell. across the board both cash and future. 7/8 of them atleast. the dow made a lower low where c is everywhere else. however, I am going with the majority and not the odd one out.

    FTSE looks like 5 up to me so some kind of retrace is in order, but the recent move looks impulsive. BTC saying buy. a finished 4th today (or in the next few days. just cant go below c) seems the most rational, but so many people see it that it can’t work, can it?

    probably gonna redabble in miners. jnug breakout retest yesterday/today? one of the silver miners i really like with the same setup.

  29. phil1247 says:

    Lee

    i am going to try to give you one more on CL

    still bullish above 67.08

    looking for a spike to 69.92

    lets see what it looks like in the am pre inventory numbers

  30. mm4398 says:

    Ugly reversal in WTI from $69 level today. Even just a normal 62% retracement targets 64.75. Could a rising USD breach the support line at the 63.50 level?

  31. Page says:

    We will see a decent size SPX bounce tomorrow which will then be sold and continue to go down towards the 2530sh area.

    Bitcoin will continue to move higher, it is now a new save haven.

  32. cj32 says:

    Cr. to CBZ

  33. Jack kendo says:


    3 waves down at 2717
    according to neely, wave e usually cut short at 61.8%. many examples.
    cheers!

  34. E says:

    Tony, are you saying we will almost certainly hit 2532 again? Do you have an expectation that the bull market will resume after that point or is it a wait and reassess at that point?

  35. I don’t believe in testing support on and on and on in a bull market.
    If the stuff is worth the price, it isn’t available at that price forever.
    But now, stocks are available @ 2560- 2600 all spring and all summer.

    I’m not short here, all cash.
    If this breaks 2560, that will be some headline.
    No idea what it will be, but Drudgereport will provide the details.

    Below ~ 2560, that’s a long way down.
    I say 1871-2134..
    ***
    Newbie is finally in bear heaven.

  36. phil1247 says:

    ” almost impossible to go below 2619″

    here is why ……………..

    2606 is next as long as 2641.5 is not traded above

  37. bouraq says:

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

  38. gary61b says:

    With the 10 year bond rate hitting 3%, could be the acceleration to the south in the indicies.

  39. aahmichael says:

    Actually, the negative news has been the blow out earnings:

    • I saw a long write up years ago by Bob Prechter on that fact….lows on high P/E’s and the opposite on high P/E’s…kind of the opposite of what one would think..thanks, Michael

      • fionamargaret says:

        Steve, you have done some really interesting stuff with commodities….I just hope you are keeping better.x

  40. H D says:

    “no negative news” Orange Swan threatened Iran.

    • Ashley says:

      Haven’t even turned on the TV today =) Just can’t take Trump too seriously anymore .)

    • tommyboys says:

      Yeah we need to continue walking on eggshells around these mean dictators. They might get mad at us. This could crater the market.

      • H D says:

        Tommy this isn’t FOX news. You’re don’t have to get triggered and spin an editorial to every fact presented. BTW Iran is a Theocracy. You just have no shame when it comes to exposing your ignorance here do you.

        • lunker1 says:

          1. Tony said don’t post news but you decided to. Strike.

          2. While posting the news you decided to insult our President which of course is going to snowball to hell. Strike.

          3. Tommy replies with a polite blurb and then you decide to insult him. Strike.

          3 strikes you’re out.
          You’re on the list.

          You should realize the Orange insults about Trump is blatant reverse racism by many liberals, blacks, people of color in our country? They can’t call him a white cracker because it’s too obvious so they go with Orange. It’s no different than calling Obama any brown/black color related racial slur. Quite ironic the double standard that many peaceful snowflakes need to use hateful color related terms to insult the President.

          You do not represent your side very well.

          • “You should realize the Orange insults about Trump is blatant reverse racism by many liberals, blacks, people of color in our country?” Come on now lunker …. reverse racism lol. You know and I know the orange comments are a direct response to a ridiculous spray tan and bad hair dye. As to the rest, your “snowflake” comment is more insulting than anything else posted.

            • lunker1 says:

              I know exactly what the orange is a reference to but again it’s no different then making fun of someone who is brown or black or yellow or has purple hair or gay or whatever. It’s funny that you take offense with snowflake instead of it being a term of endearment because every snowflake is different and liberals supposedly find beauty in every person but yet you’re allowed to make fun of trump because he’s orange. It’s just the whole double standard. Go read on social media how evil the orange comments are. It’s no different than racial hate comments.

              • aahmichael says:

                Dude, Trump is orange by choice. Orange is not a race.

              • lunker1 says:

                And of course every gay person in the world is not gay by choice it just happened by genetic magic? So we can’t make fun of gay people because it wasn’t their fault that they were gay it just happened genetically like race. The argument is flawed whether or not it was someone’s choice to look like her be something or not to throw insults at anybody for any reason is the snowflake argument but yet liberals thinks it’s think it’s fine to call Trump whatever they want to.

              • aahmichael says:

                Making fun of Trump’s fake orange clown face is no different than making fun of Obama wearing a tan suit. It’s just that Obama only wore that suit once, not every damn day.

          • H D says:

            the list? ha. GFY lunker. Did you read Tony’s update. He mentioned market went down on “no negative news.”

        • fionamargaret says:

          On the bright side HD, if NK is really open to thinking outside their box, then think of the expansion possibilities….no wonder Schmidt (Google) visited….and then there are the Trump hotels….mind-boggling…..

          • Theatre…don’t you think.

            • fionamargaret says:

              …there are quite a few influential people read the blog Fisher….trying to direct a positive mindset to NK…..
              I have some trouble with “the list”…brings up memories in some of my followers, of the Stasi and the GDR…better to just be positive..x

  41. 123 abc says:

    Thank you for the Tony Tuesday update!

    • ABC.. can you do one on BItcoin… i believe we are looking at resistance here… and also Ethereum

      • 123 abc says:

        Suspect the Bitcoin market is undergoing a large Symmetrical Triangle formation since the 06-FEB-2018 low which may elapse until JUN-2018 before the bear market resumes.

        Current upside targets ought to be found at either of the following Fibonacci levels (Bitfinex):

        @9685: 61.8% Fibonacci retracement of the wave from 05-MAR-2018 to 01-APR-2018.
        @9946: 50% Fibonacci retracement of entire Bitcoin market.
        @10571: 78.6% Fibonacci retracement of the wave from 05-MAR-2018 to 01-APR-2018.

    • torehund says:

      You are and have been spot on abc, kudos. Yes it looks like another x in the making which will retrace what it possibly can retrace. Drawn out decision AS always at major inflection.

  42. Lee X says:

    Thx Tony

  43. Lee X says:

    Thx Tony

  44. Thank you, Tony. Much appreciated.

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