Weekend update


The week started at SPX 2735. The market gapped up on Monday to start the week. Then it made a higher high, than the day before, every day until Thursday when it hit SPX 2780. After that it pulled back by to SPX 2760, and then rallied to 2779 to end the week. For the week the SPX/DOW gained 2.2%, and the NDX/NAZ gained 1.1%. Economic reports for the week were mixed. On the downtick: factory orders and consumer credit. On  the uptick: ISM, plus the trade deficit and weekly  jobless claims improved. Next week’s economic highlights include the FOMC meeting and industrial production.

LONG TERM: uptrend

Big picture. From the years 1932 to 2007 the stock market completed a Super cycle bull market. This multi-decade bull market, which includes multiple smaller bull/bear markets, was then corrected by the largest stock market decline since the 1929-1932 depression. The 2007-2009 great recession. Then in early 2009 the next multi-decade Super cycle bull market began. Each of these super cycle bull markets are created by five Cycle waves. The Cycle waves during that super cycle occurred during the following years: 1937-1942-1973-1974-2007. Note, of the three bullish cycle waves 1, 3 and 5, one was short (5 yrs.) and the other two were quite long (30+ yrs.). The US market is currently in a long Cycle wave 1 of the new Super cycle.

Each of these bullish cycle waves are created by five Primary waves. Waves within waves, greater to lesser: Super cycle, Cycle, Primary, Major, etc. From the early 2009 low the market unfolded in a 6-year bull market until mid-2015. We labeled that Primary I of Cycle 1. Then there was a short bear market into early 2016, which we labeled Primary II. From that low a Primary III bull market began. Historically, third Primary waves, in long cycle waves, are 15+ years in length. This suggests the current bull market is only Major wave 1 of Primary III, as labeled. Our target for the current bull market, since mid-2016, has been SPX 3000+ by 2018+.

MEDIUM TERM: uptrend

Over the past couple of weeks one short/medium term count appears to have emerged out of a handful of potential counts. This count is posted below, and also on several other important indices. When reviewing the entire wave structure of the 2016-2018 bull market the wave count does look quite clear. See weekly chart above.

Intermediate wave i rose 300+ points, and then was corrected by a multi-month irregular Int. wave ii zigzag correction. Intermediate wave iii took 19 months to unfold and gained nearly 900 points. After that there was an Int. wave iv, multi-month, flat correction, alternating with Int. ii. Even Minor waves 2 and 4 of Int. iii alternated in structure (zigzag-flat). Since that April low the SPX has been in a somewhat choppy uptrend. We are labeling this as Intermediate wave v.


As noted above. This uptrend has been rising since the early April low at SPX 2554. Internally it has been somewhat choppy compared to other uptrends in this bull market. However, the larger waves within the uptrend do suggest the market is progressing impulsively.

We have labeled Minor waves 1 and 2 at SPX 2717 and 2595. Then Minute waves i and ii at SPX 2742 and 2677. Minute wave iii should be underway at this time. Short term support is at the 2731 and 2656 pivots, with resistance at the 2780 and 2798 pivots. Short term momentum ended the week overbought. Best to your trading!


Asian markets were mostly higher and gained 1.0% for the week.

European markets were mixed and lost 0.15% for the week.

The DJW index gained 1.3%, while the NYSE gained 1.7%.


Bonds remain in a downtrend and lost 0.2% on the week.

Crude is also in a downtrend and lost 0.1%.

Gold, a downtrend here as well, but gained 0.3%.

The USD is in an uptrend but lost 0.8% on the week.


Tuesday: CPI and FED budget. Wednesday: PPI and FOMC statement. Thursday: jobless claims, retail sales, export/import prices, and business inventories. Friday: industrial production, the NY FED, and consumer sentiment. Best to your investing week!

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

About tony caldaro

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372 Responses to Weekend update

  1. mcgcapital says:

    It’s you’re long here and don’t take profits, can’t complain if they disappear. 11 green bars in a row on the daily and they’re getting smaller and smaller.

    If it does accelerate upwards can always re-enter on a break of 2800. Until then, holding long is clearly the wrong trade to me. Sometimes it’s ambiguous which side is the right one to be on.. but this isn’t. Being long here is just as bad as holding shorts on a retest of the lows


  2. phil1247 says:

    asa ..

    re : silver

    going to take profits in most of silver premarket now
    it still looks ok but gold does not
    going to wait till after fomc for next move

    target is only 9 cents away


  3. mcgcapital says:

    FTSE becoming a bit frustrating to trade, have to keep switching directions. 7740s-70 is clearly a sell, 7690-7700 is the neutral point above which it’s bullish and below which it’s bearish down to low 7600s. That’s the current range.. above 7770 is a bullish breakout in the bigger context and under 7600 a bearish breakout.

    In the current range, I’m looking to sell 7740-70 area depending on candlestick set ups, and buy 7690-7710 if oversold RSI. Under 7690 I’m switching short.. 3 times out of the last 4 I’ve been faked out on that move though. But I don’t trade bear or bull traps, have to give the benefit of the doubt to the current direction when under support or above resistance. I can see 7690-7700 is the right pivot to trade against because each time it’s faked out it rallies hard back to 7740+ as soon as 7700 breaks.

    7600 is a clear buy for a swing long trade if it ever gets there.


    • floyd drummer says:

      candlesticks: ….how many candlestick set-ups do you use? …are they usually single bar set-ups (…doji’s) ..or multiple bar set-ups?
      i feel as though candlesticks would work well in my style of trading, …any suggestions on working with them?

      i very much avoid traps, …hard lesson to never take the break, ….at least not the first one. never. ever.


      • mcgcapital says:

        Nothing too fancy.. i’m just looking at the 5 min chart and waiting for some sort of consolidation before I’d trade a reversal. When the bars are in a straight line green or red it’s usually poor risk reward to fade it. I’m looking for reaction-retest-rally/drop usually.. so on FTSE I’ve sold 7740.. didn’t sell the first hit when it was going straight up and got to 7746, but after it came off a bit and then retested that’s my entry. Same on the long side, but sometimes it doesn’t retest. Level + candlestick usually gives the best entry. There’s also a time element too sometimes.. like if FTSE opens bullishly at 8am, it usually doesn’t reverse until mid morning or when U.K. data comes out at 9.30am which moves sterling. Then when the US opens that’s kind of like a new session.. often dips between 2.30-3.00pm and then ramps. It all depends on context tbh.. like I’m looking to fade rallies because we’re in a range.. if it was trending up on the daily then clearly it isn’t often going to come back down when it rallies, it will keep going


        • floyd drummer says:

          we have some similarities in styles, …it’s what i sensed, and hence why i ask questions.
          i’m new at trading, though, …lots of learn.

          i also try to keep it very, very simple. …i find a simple system, …with trading discipline works best (…for me).

          “When the bars are in a straight line green or red it’s usually poor risk reward to fade it’ …?

          “Level + candlestick usually gives the best entry. ” i assume you mean thin bodied bars with the bodies in a straight line across. i agree, ….they are easier to get a specific price fill, …and they can reverse well. i find though they are more accurate to trade on a small tick chart than a minute chart.
          i primarily use tick charts, ….i find them much better, ..unless i am trading a thin market (…asia and parts of europe,) .. where i use both a small minute chart, … to illustrate abnormal volume, …and a large tick to illustrate trend.
          i trade a lot: all hours of the clock (…though not all of the time!). the screen time is good, …you very much get the time element. ….and you get the trend better as you see it’s complete cycle.

          thx again for your perspectives.


          • mcgcapital says:


            This is the chart I trade off.. the candles show open and close (extremes of the red and green bits) plus the high and low points (extremes of the wicks). When they are all one colour it signifies the trend is strong so don’t go against it. When it levels off and you start seeing a mix of colours there’s indecision and you can fade it if you have a set up. Conversely, if you’re long already and there’s a big line of green bars then hold until you get a red one etc.

            I’m not looking at volume or anything like that. Also, I do most of my trading during UK trading hours, and sometimes between Europe close and US close. As I’m trading spread betting and using tight stops I want the bid/offer spread to be as tight as possible… it’s too wide for me out of hours unless something major is happening and there’s volatility.


  4. Fenster:
    Fake news strikes again!


  5. vivelaamo says:

    Looks like spx and dow are taking a breather. If this continues will be looking for a bull flag to form and then to go long on the break up or take profits on unlikely even we break down . Let’s see how next few days plays out.

    GL all.


    • mcgcapital says:

      Will probably just keeping edging up by a point here and there then sell off 30 points.. either way, not too pleasant to trade on either side


    • alexh110 says:

      Dow looks weak; but SPX seems to be consolidating above the 2780 pivot, which ought to be bullish.
      Hope to see upside momentum accelerate to confirm the weekly MACD projection I posted below.

      Liked by 1 person

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