Weekend update

REVIEW

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.

SHORT TERM

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!

FOREIGN MARKETS

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%.

COMMODITIES

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.

NEXT 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

Investor
This entry was posted in special report, weekend update and tagged , , , . Bookmark the permalink.

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.
      agreed.

      • 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:

            https://www.ig.com/uk/indices/markets-indices/ftse-100

            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.

  6. cj32 says:

    Cr. to CBZ

  7. alexh110 says:

    Taking a look at the IHS patterns on SPX weekly MACD, I noticed they’re all fairly symmetrical throughout the current bull market (see chart below).
    This implies a short powerful Int v underway. Have projected the move forwards, and it could end as early as late July.
    To extend much further in time I think it would have to subdivide (which Tony has suggested is unlikely).
    If the uptrend does continue beyond July/August, it will likely become harder to trade.

    All the IHS patterns have right shoulders skewed to the upside, which was also the case with the daily MACD pattern around the Int iv correction.

    If I’d had any sense I would’ve done this analysis a few weeks ago, then I wouldn’t have made so many bad calls since the 2594 low. Sorry for getting it so wrong!
    I’d anticipated a more balanced IHS pattern on the daily MACD, similar to the central pattern on the hourly chart.

    N.B. The weekly MACD IHS patterns for Primary I look quite different, in that they all end around the same height they began, or lower. For Primary III, they all end higher, which seems to confirm Tony’s long term outlook that we are now in a Secular Bull.

  8. fenster6 says:

    Did you read trumps latest tweet.
    ” My meeting with a complete success. I got Kim to sign a piece of paper. This is different from the last 7 pieces of paper Kim signed over the last decade. We like each other, we have similar hair , we bonded like the strong dudes we are. If we had more time we could pick up a couple of chicks in Singapore. “

  9. quickrick38 says:

    And this is the crap we’re calling “impulsive”? Give me a break!

    • lunker1 says:

      Tony says ES makes ABC’s….but yes SPX is impulsive

    • CampFreddie says:

      Quick – Just bullish sideways consolidation … no need for hysterics.

      • quickrick38 says:

        OK guys…I here ya. But, you have to admit this ‘Impulsive market’ has been missing the impulsive part for a few days now.

        • quickrick38 says:

          Sorry, “hear ya”. 🙂

        • mcgcapital says:

          Well at the top of the waves it always goes like this.. it just looks like it’s about to pullback soon. 2675-2790 clearly looks impulsive.. but I can’t see how anyone can view 2550-2740 as impulsive. I know TC has it labelled up like that but it looks forced to me.. I don’t use Elliott wave but do consider whether it’s trading with no overlaps (impulsive) or is choppy (corrective), and SPX until the last fortnight was definitely choppy. Aren’t C waves sometimes impulsive? So could be an A-B-C up from the lows still.. but I don’t know enough about EW rules to say any more than that

        • lunker1 says:

          Hit resistance at the lower end of the 2798 pivot and then retested support of the 2780 pivot which used to be resistance. so far that’s all constructive for an impulse.

  10. torehund says:

    A good laugh prolonges life😆😆😆

  11. At&T/TWX merger decision is said to possibly pour some short term cold water on equities,if shot down.Judge ruling imminent.

  12. Dollar and 10 year yield holding up very nicely and in fact should spike soon. I know PHIL the guru says otherwise. just giving my interpretation along with the fact that volatility will also spike soon, best guess in next 5 days. Friday we see if trump is placated with China giveaways and their help orchestrating the NK meeting. If Trump gives a pass to China you can bet he will reinforce his hatred of the G6. Maybe we get the best of all worlds, a full blown trade war with everyone. (IF) Trump does impose tariffs on China I will be betting big that NK will renounce the meeting over the weekend. Just a hunch that China controls the outcome. Teflon trump seems impervious to market drops but once he mentions AUTOS it’s all over. The absurdity of trumps behavior will only get worse as his enablers echo everything he says. Based on timeline and emotional outbursts we can’t go much beyond next week. in fact I think it happens late this week or over weekend. Yes I am the guy that bets longshots. The setup is so rare that to not gamble here is wasted opportunity. I caught the two big drops but also many false ones. profits from those 2 enough to let me gamble many times over.

    I am NOT however betting till I see (any) sign of a steep drop. Friday ends week 20 of correction.

    • fotis2 says:

      Dollar in an uptrend everything trading against it massive bear flags most broken with lower lows coming up. ES expecting reversal 2800s for 2510 Stop 2810

    • Anonymous says:

      Look for IWM to break 165.23, or get puts tomorrow, market on close. Stick to the market, other speculations not worthwhile. If Trump walked on water, the left wing media would report TRUMP UNABLE TO SWIM.

    • chrisk44342 says:

      Here’s to hoping you get bored and go away soon

    • waterstim says:

      Gary Holly Silver, How many times has Tony asked us not to get political? You’re nonsense is embarrassing. Your post is political with a couple of meaningless financial dart-throws. Go away.

  13. scottycj1 says:

    June 13….next st cit date

    • stcoleridge says:

      So fade the post FOMC rally for a ST trade?

      • scottycj1 says:

        I think tomorrow is going to be an acceleration in trend …like May 9th was.
        An increase in the move up…looks like it might be starting now…..some get in early.

        • Ashley says:

          You know I actually agree with you… I think we see the DOW take off up near 26000 (end of 3) then fall to wherever the lower trend line is (end of 4) then back up to the upper trend line end of major, primary and CYCLE V… The next advance determines the wave 5 high which may not make a new ATH on the DOW but likely will on the others, it is a large ending diagonal starting after the quick zigzag wave 4 from the ATH to 23.3K, yes I think 4 has been done for a while .) SPX will fill the GAP at the 2835 pivot and I think COMP Q will be the weakest… This pattern is clearest on COMPQ and SPX… The internal wave count so far is all 3’s and there is no way to label it any other way… When it gets started down after the 5th wave we enter the next “great depression” and there’s not a damn thing anyone can do to stop it IMHO… GL

          • tommyboys says:

            Disagree with any depression. Agree with Tony SP 3-3.2k for a top to major V, then a 20% -ish bear. After that a new sequence begins. We’re in an Awakening – 1st turn, depressions occur in 4th turns – Crisis periods. That’s a ways off now – like a saeculum…

            • scottycj1 says:

              Demographics dont support that

              • Ashley says:

                Demographics support a depression Bigly, one only needs to look at declining populations worldwide and the record amounts of debt….

            • Ashley says:

              We aren’t yet IMHO, this count also works if you think we’re in P5 from 1932 , your 20% would be more like 38.6% of the rally starting in 09 then a long 3 UP for many more years… Id actually prefer this scenario but what I think won’t matter, time will tell GL

              • Ashley says:

                Basically I don’t think the decline in 2nd half 2015 was what Tony calls a “BEAR”, it was P4 of a clearly 5 wave move from 09…. The BEAR in 08 was the end of a wave IV flat (the rally from 02-07 was a big B wave) and since BIG III subdivided with extension I wouldn’t expect to see it again in V but I do think you could call the last 9 or so years “wave 1” of the big V….

              • tommyboys says:

                I DO believe what Tony suggests – 2015 was a bear – 19.7% drop. SEE – we ALL
                have opinions.

              • tommyboys says:

                The whole Dent demographics argument is lame. Wealth gets transferred, handed down, recreated, respent and reinvested in new technologies and growth locally and globally. Any poulation shift just reallocates those same funds in different ways. Dent’s been calling for tge same for a quarter century…nonsense like Holly/Gary…

  14. gary61b says:

    ES below 2789 then confirms a AB with a now C leg from yesterdays high of 2794.

  15. Everything equity related is bullishly embedded.Only the Fed can shake this nice contented market
    from what seems like its return to the boring uptrend of 2017.If the Fed is hawkish,the embedded stochastics could fall apart in 2 hours tomorrow.Still trying to figure out Powell.Does he prefer protecting equities or would he rather jack rates up,no matter the consequences.Does DXY sell the news and gold start a 5% rally?Does Kudlow retire due to health reasons?Does his replacement want to push King Dollar like Kudlow?Stay tuned.

  16. torehund says:

    Biotech soon entering prime time, weekly macd histogram has been submerged for quite some time, now wanting to put on positive bars, Uberbullish😎

  17. vivelaamo says:

    Hands up if you bought the dip 🤚 😀

  18. fionamargaret says:

    DWT…..short oil to 59/60

  19. hugh jazole says:

    Crude is in a downtrend? Up 40% in the past year.

  20. scottycj1 says:

    All the traders are sitting at their stations waiting for the Almighty Fed. Cant do anything until they give you the nod

  21. emuntrader says:

    Max Target = 2800.55. Above this level would be an extension of the int wave iii.

    intermediate wave iii started at 2700.68. minor wave 1 = 51.93; minor wave 3 = 40.39;
    wave three cannot be shortest wave.

    Higher time frame. on the daily $SPX cash, there is a clear 5 wave pattern up from the 2676.81, so and extension is very possible here or a pull back to the 2760 level. Not trading around the FOMC, I don’t see a clear path.
    Best of Luck to those who are.

  22. Hi phil..DH way too bearish over last few months. What “rogue” anchors are you using for the next long entry and what is your 61.8% LIS?
    Haven’t been day trading much as I have taken swing trades long a few weeks ago.

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