Weekend update

REVIEW

The week started at SPX 2670, and ended there as well. The SPX ranged between 2684 on Tuesday to 2613 on Wednesday. Quiet compared to most recent weeks. Also, in a week that had three gap up openings, and no gap down openings, one would have thought the market would have gained about 2%. But it was simply unchanged. For the week the SPX/DOW lost 0.3%, and the NDX/NAZ lost 0.3%. Economic reports were all positive. On the uptick: Q1 GDP, existing/new home sales, Case-Shiller, consumer confidence/sentiment, durable goods, plus weekly jobless claims declined. Next week’s economic highlights: FOMC meeting, monthly payrolls, and ISM. Best to your week!

LONG TERM: uptrend

After making an Intermediate wave iii high in late January, the market has churned its way for three months in an Intermediate iv correction. Tuesday will make it the fourth month, and longest correction of this 2016-2018 bull market. It is quite easy to turn bearish after well over a year of 3% or less corrections, and then watch a nearly 12% correction unfold while dragging out for months. We see no reason to be concerned unless the SPX loses 2500.

The bull market, despite this lengthy Int. iv, continues to unfold as labeled. Intermediate waves i and ii ended in the spring of 2016. Intermediate wave iii then started to subdivide. Minor waves 1 and 2 ended in the fall of 2016, and Minor waves 3 and 4 ended in the spring of 2017. Then after a lengthy uptrend, Minor wave 5 and Int. iii ended in January 2018. Int. wave iv has been underway since then. When it concludes, Int. wave v should carry the market to all-time new highs. Still looking for SPX 3000+ between 2018-2020.

MEDIUM TERM: downtrend

This Intermediate wave iv downtrend has had many starts and stops. In February it looked like it could be done, but the following uptrend failed. In early April it looked like a double bottom, but the rally off that low has been choppy and corrective. This week, after the gap up openings, in an uptrend the market would have been up about 2%. It was unchanged.

We continue to track two possible scenarios: triangle and double three. The triangle suggests a rally about SPX 2717 before the SPX drops back to the 2550’s again. A double three suggests the market trades lower, without rallying to 2717, to complete the pattern in the low to mid 2500’s. Either way it looks like more choppy action ahead. Medium term support is at the 2656 and 2631 pivots, with resistance at the 2731 and 2780 pivots.

SHORT TERM

The month of April started with such promise. The SPX had made a double bottom. There were positive divergences everywhere. Strong earnings were expected to be reported. And the GDP was still near 3%. The market started with a strong rally from SPX 2554 – 2672. Then after a pullback to SPX 2586 still in the first week, the choppy/corrective activity began and lasted throughout the month.

Expecting more of the same until this complex Int. wave iv completes its pattern. Short term support is at the 2656 and 2632 pivots, with resistance at the 2731 and 2780 pivots. Short term momentum ended the week just above neutral. Best to your trading!

FOREIGN MARKETS

Asian markets were mostly higher and gained 0.7%.

European markets were all higher and gained 0.6%.

The DJ World index lost 0.3%, and the NYSE lost 0.1%.

COMMODITIES

Bonds remain in a downtrend and lost 0.1%.

Crude is still in an uptrend but lost 0.4%.

Gold may be in a downtrend and lost 1.1%.

The USD remains in an uptrend and gained 1.4%.

NEXT WEEK

Monday: personal incoming /spending and the CPI at 8:30, then the Chicago PMI at 10am. Tuesday: ISM, construction spending, and auto sales. Wednesday: the ADP and FOMC statement. Thursday: weekly jobless claims, trade deficit, ISM services and factory orders. Friday: monthly payrolls (est. 103K). Best to your weekend and week!

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

About tony caldaro

Investor
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439 Responses to Weekend update

  1. rd3777 says:

    All computer traded….setup for a crash down tomorrow.

    • CampFreddie says:

      Disagree strongly.

      • NEWBIE says:

        Camp, when the market use to go up everyday you were on point. Now that the market doesn’t go up everyday, well not so much.

      • rd3777 says:

        This market is 95 pct computer traded and the program is set up for maximum volatility linked to the JPN225 to distribute as much stock as possible into weak hands. So when it shits the bed don’t be surprised…lol!

    • vivelaamo says:

      With all due respect you seem to post that we are setup for a crash every day and it just isn’t happening. What needs to happen for you to change your view?

      • rd3777 says:

        a crash is a 1,000 pts….I think that’s very doable given the lousy chart pattern and massive distribution that has taken place.

  2. 2647 is the .38
    2654 the .5
    2661 .618
    then down again

  3. Simon s says:

    news coming out israel and iran might do the mexican standoff…..

    Catalyst for sub 2500s

  4. FOMC – (F)orced (O)ut of the (M)arket (C)onfused.

  5. scottycj1 says:

    OK Newb……pull the plug

  6. phil1247 says:

    squeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeze

  7. H D says:

    Just a general reply to any number of posts below….

  8. ewmarkets says:

    AAPL has been a rock in the latest drop. Perhaps it’s sending a message: it’s still a bull market and everything will be ok 🙂

  9. cj32 says:

    Cr. to CBZ

  10. fxaprendiz says:

    Very excitable crowd in here. Lately most people in here get fired out with a mere 20-40 points move. I’m after the 200 to +300 point moves, hence my long term and big picture approach.
    Does anybody in here knows of a site where most of the talk is long term? Any replies appreciated in advance.

    • makiori says:

      in the long term we are all dead.
      the obituaries page of your local newspaper is a good reading, alternatively to get a long term prospective on the markets a good site is caldaro.worldpress.com
      The guy that runs it, offers for free excellent long term and medium term analysis of many markets. And he has done so for a very long time……talking about prospective

      • fxaprendiz says:

        I didn’t mean disrespect to either Tony or his site, yes he talks about the long term but most of the chat in here is intraday trading. But thanks for the thoughtful reply. Appreciated.

    • micky says:

      How much talk can there be about the longer term other than we are in a consolidation/correction with clear horizontal lines that need to be broken first before getting excited either way? Anything else regarding longer term is mere musings at this stage imho.

  11. NEWBIE says:

    Bounce to 2650 (+/- 5) and then MONSTER DROP!!!!!

  12. The bounce from 2626 has some SERIOUS W-3 characteristics. Wow, if this is it, then the next move would be explosive. Keep your powder dry, as tomorrow would be a lot of FUN.

  13. phil1247 says:

    short squeeeeeeeeeeeeeeeeeeeeeeeeeeeeeze fuse about to be lit

  14. phil1247 says:

    es

    more aggressive ext short in force now has just hit target at 2623
    you now the drill
    bounce off target
    or go thru and accelerate down
    entries are between 30 to 36 on bounce

    target 2619
    and 2612 ( -618%)

    • fotis2 says:

      CL swoooosh

      • phil1247 says:

        if short you dont want it above 67.64 any more buddy

        bull trap sprung with outside up yest and breaking low
        i am going to wait ..for close below 18dsma and short a bounce

    • phil1247 says:

      error … entries are 30 to 34
      above 34.5 breaks agg ext short
      and opens the door to squeeze up to 2653.5

      • gary61b says:

        20-36 is the volume cluster, consolidation, distribution area.. needs to break out or its a confined pinball.

    • The action is in QQQ and FANG today. I don’t get why people just don’t let it go and buy back at QQQ reaches at 155 and then exit at 165 later. Now, buying this freaking dip won’t net them much money!!!

  15. Revised my short-term count based on today’s market move: Now the market is in the extended fifth of w-c (from 2683) of Big zigzag from 2718. The ideal target would be 2590, and today is going to be ugly. BTW, I sold all my calls & longs yesterday with some good profit. This morning, in all my accounts, I only hold some PFE & MRK puts, waiting for the WATERFALL. Yes, it did come true. A quick $15000 profit in two days (see my twitter account for details). Now, I hold SPY 262 puts (May 2).

  16. stcoleridge says:

    OK if HD hasn’t said it, or maybe he did much lower down, 55 down from 2683.

  17. fxaprendiz says:

    When I post in here I usually talk about waves of Cycle degree and up. But today I’ll talk about my roadmap for the smaller degree waves, up to the year 2022.
    Currently in Minor 4 for the last 3 months. It’ll probably end this month.
    Minor 5 to unfold next and until early 2019.
    Intermediate 4 to follow for maybe 6 months, with a 15-19% correction.
    Next will come an Intermediate 5 probably lasting until 2022.
    Only then we will have a correction of Primary degree, of about 25-30% with the potential to cause a mild recession.
    The labelling of the wave degrees differs from the OEW used in this site. Just convert my Minor degree to your OEW Intermediate degree, and my Intermediate degree to your Major degree waves. The labelling is the same for both systems from Primary degree and up.

    I’ll keep the label of Minor degree for the current correction unless it goes under 2417.
    Sustained trading between 2417-2300 will make me change to an Intermediate degree correction, and sustained trading below 2300 will make this a correction of Primary degree.

    Still not seeing any corrections of Cycle degree until the 2032-35 years. And it will take something like a highly unlikely big crash to change my stance on it. And by big crash I mean something of the order of +50% down in a year or less, not the -5% dips in a few days some guys in here are so fond of calling crashes.

    • E says:

      It is possible that we are already in primary 1, intermediate 3, minute iii of a bear market. Won’t you be way too late with your predictions if that is the case?

      • fxaprendiz says:

        Highly unlikely scenario, E.
        It would imply a correction 2 degrees up Primary degree. Allow me to elaborate.
        For the move down from 2872 in January to be a Primary 1, you are implying 5 waves down in Primary degree, therefore the next degree up, Cycle degree wave would need to be a Cycle A, which would make the next degree up, SuperCycle a Zigzag. You are basically calling for a 1929 style crash, which at this point in time and in the EW sequence has a very, very low probability. Here’s the count I’m following since the 1932 low:

        https://caldaro.wordpress.com/2018/04/28/weekend-update-651/comment-page-1/#comment-348594

        Yes I am expecting a SuperCycle degree correction eventually, but not until after 2032-35, and even then it will most probably be a less deep and more long protracted event, more like the 1835-1857 years.

        You see, sometimes you need to take 2 steps back (in this case go 2 wave degrees up) to see what are the more probable scenarios.
        You’re asking me if it won’t be too late for me if your scenario pans out. Frankly speaking, I would be less concerned about missing a short trade than concerned about my family and society in general in a Super Cycle correction.

  18. E says:

    I think we are in a bearish (minute) wave 3 down rather than a bullish wave 2. It could plunge us down to 2532 when finished. Invalidation at 2682(?)

  19. Gary Lewis says:

    Still not looking too bad. The Wave 2 scenario may still be in play https://www.tradingview.com/x/rGYJzDyj/ But I’m a novice on the wave stuff so it’s quite possible that I missed something. Is there something there that would invalidate a wave 2 possibility? Thanks

    • aahmichael says:

      Wave 2 can not go below the start of the supposed wave 1, yet the DOW, NYA, XMI, RUT, EFA, and VWO have all taken out their 4/25 lows. SPX will be next. This decline was not a wave 2.

      • fionamargaret says:

        TLT has just changed to a positive sequence to 181…..TMF….3x……stops

    • I am in the W-2 camp, though it will retrace to 2590 area, the 78.6% of entire rise. Frankly, I was a bit surprised that the market reversed upward on April 25 at 2612, leaving a big gap below. I was expecting then, that the 2604 would at least be filled. Now, it turns out this second leg would do the trick.

  20. Lee X says:

    New rule
    Unless you’re LML25 please stop talking about gold unless you talk about stops also

  21. alexh110 says:

    Hourly +D at a pivot: seems like a good place to rotate some shorts into longs.
    Possible bounce coming, but cautious, as I feel the next big move is down.

  22. Ashley says:

    Just took a cheap long here, bring it bulls .)

  23. vivelaamo says:

    See you when it’s back above the 200 dma. Let the bears feast for now.

  24. fotis2 says:

    Keep your ammo dry folks some beautiful setups coming up .

  25. fotis2 says:

    Huuge DT on Gold just confirmed on 15 min if daily close bellow 1300 EOD targets 1238

    • I’m trying to think,who said that Kudlow was going to prop the dollar up?(Me)That’s his theme and “someone” is buying dollars.All I can say now is if the dollar starts soaring and the market has a major selloff,Trump might force him to quit.THAT would be a gold buy signal.But for now Kudlow is in control.
      Part 2:Wondering how many times the 200d holds.In a normal market,every hit usually weakens it for the next attempt.But with central bank intervention rampant around the world,those rules may or may not apply.PPT could just go in and save it every time it tries to violate the 200d.As “Dirty Harry” would say,”Do you feel lucky?”

  26. E says:

    Maintaining May 11 2450 target. I don’t think this will reverse directions until there is at least one round of panic selling. Everything still looks very orderly right now.

  27. scottycj1 says:

    This is a pretty pitiful bounce off this st uptrend line……NYAD is also breaking below 50 dma….might be looking at a quick flush down for a couple of days

  28. gary61b says:

    ES,LOD to 2634.5 possible HWB setup

  29. Tony’s lower pivot 2631 broke slightly, also 200 day ma close by…I would be somewhat cautious on the, looks like a “possible big down day” to me…..remain flat on index, but have used hedges on my positions…covered calls out 2 expirations, long otm puts May, and long some otm calls (May), too

    • fionamargaret says:

      I think we go through the 200…and the levels I noted earlier and below….momentum will determine, thus VXX is a good idea…also at some point TMF….

  30. Gary Lewis says:

    How could this happen??? (disbelief that market is down). What’s the news? I thought the tariff wars were delayed for a month. What did Trump tweet now??? 😉

  31. stan911 says:

    I have thi as a ABC starting from 2718, A=2612 B=2683 now C=2577 with extension
    1.23=2553 1.38=2536 1.61=2511

  32. On the 1 minute chart (yes very subjective, I know), SPX printed a morning low at 10:15. There was a 50%wave a,b and c retrace. Since the wave 2 high (?) I have 1, 2…and 1,2 of 3 trading expect a minor waterfall.

    • If and that’s a big. “IF”, if my 1 minute wave count is accurate, /ES could trade down to it’s PT at 2622.61 which is approx. SPX 2625….I know it’s a long way down from here….may be a small micro 50% SHORT will develop…we’ll see.

      BTW, /VX is skyrocketing

  33. rd3777 says:

    The only thing saving this market from a total rout is the JPN225…if that turns down…watch out.

    • rd3777 says:

      This market has topped and it did it in Jan-Feb when you have a long run up and then the market breaks like it did 3,000 pts….It’s over….this market will crash at some point.

  34. stan911 says:

    Anyone have 2590 as 1st support level?

  35. Jack kendo says:

    2632 pivot, should launch higher from here into the 9th.
    two charts showing that (CF and hooloo and learned requested not to post chart).
    1. “very reliable” timing system.
    2. recently has been working nicely wave counts.
    cheers!

    • NEWBIE says:

      Just doubled my short thanks for the sign.

    • Jack kendo says:

      2632 is “must” defend, just like the other way of 2682 was must defend as i showed and nailed in the charts yesterday.

      PS. NEWBIE = lunker = perma bull
      cheers!

    • For accuracy’s sake–I disagreed with CF about not showing those charts–I thought they were important–and had a great chance of to be prescient.Then I followed up with a question of a downside target.Well done JK,so far..lol.With tbis market of ping-pong pinball,who knows for sure.

      • Jack kendo says:

        learned, i mis-understood your “disagree”. sorry.
        well, that 2682 was right at the nose for me to add short for the 4th and last time. Sunday night, i even posted and listed the plan to add short at 2680, all calculated and plotted.
        lol, did anybody here or anywhere had such a precise call before and live call? lol

        it’s nearly 100% matched with the charts i posted during the weekend. i believe Tony agreed and replied with the scenario and pattern with his own 2 examples: short term bearish & long term bullish with substantial new ATH.
        but all these new ATH must be after the corrections completed.
        my “key” to your target question: one step at a time. ==)
        cheers!

    • vivelaamo says:

      They requested for you not to post the same chart over and over again. Who’s hooloo? If you mean hohoho then don’t ever listen to that bitter old man.

      Post your chart!

  36. gary61b says:

    ES 2636 to 2620 is another cluster or distribution area as long as it stays inside of those levels. rejected in the first 15% edge decision time in or out.

    • phil1247 says:

      last one

      target of new ext short now that 2636 was exceeded is 2625
      but it has not traded yet

      • gary61b says:

        ES I see possibly 2646 as a level to be tagged.

        • phil1247 says:

          2648 is .38% entry to ext short with 25 target
          small front run is possible at 46

      • /VX traded actually front ran this weeks 50% LONG and is defending…so far. Bearish for equities. But the divergence continues with /ES declining father than the/VX is rallying. At some point (hours/day) they will come back in sync.

  37. Ashley says:

    Covered yesterdays short here =) I’ll look at reshorting the rebound….

  38. xuwu992000 says:

    Gap-down open: I was totally wrong; very bearish here.
    However, I am glad that one of my lottery tickets win out big [PFE puts].

    • Gary Lewis says:

      That’s OK, I still just bought some July SPY calls, assuming that this may be a wave 2 in progress. Still have some puts in case I’m wrong. Always have something going in both directions, just in case.

    • fotis2 says:

      Kudos for admitting you wrong except for a notable handful most here never have/admit to a loosing trade.

      • h66h says:

        I think you mean “losing”. BTW, speaking of losing trades, how’s that gold short working out for you fetis, LOL?

        • fotis2 says:

          Gold short?Waaaay back on the break of the Bear Flag on 4hour chart target 1300 hit to the tick.Here’s another one Short here Stop 1324 TP1 1278 if that hits slide to 1240 TP2 don’t get your knickers in a knot bud its just a trade NOTE post is before the fact not after like yours

    • xuwu992000 says:

      W-2 may have completed at 2636, already filling the opening gap. Now, it is going to be the W-3 time. W-3 is most likely sub-divide into a bull’s nest, which means several 1-2, 1-2, 1-2 series.

    • xuwu992000 says:

      If this opening gap can not be filled in the next two-hour, that would be super-bearish. BA seems to lead the retrace, signaling a bad outcome from U.S.-China talk.

  39. phil1247 says:

    gary

    es bear below 56
    target 2636

  40. phil1247 says:

    gary lewis

    i assume you exited TLT yesterday
    the counter trend bond squeeze was weaker than i expected
    so i had to bail on TMF yesterday
    did not go back to short yet .
    …moment of truth coming up for bonds soon

    • Gary Lewis says:

      I left a couple of long calls in place as a Fed surprise could change my outlook, but established some long term puts assuming the break of the smaller head and shoulders formation. Target 108.

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