Weekend update


The week started at SPX 2779. The market opened slightly higher Monday. Rallied to SPX 2790. Then bounced off of SPX 2789/91 for the next three days. On Friday’s option expiration, the market gapped down, hit SPX 2762, then rebounded to close unchanged for the week. For the week the SPX/DOW were mixed, and the NDX/NAZ gained 1.05%. Economic reports for the week were mostly positive. On the downtick: industrial production, plus the budget deficit expanded. On the uptick: the CPI, the PPI, the NY FED, retail  sales, import/export prices, business inventories, consumer sentiment, plus weekly jobless claims declined. Next week’s reports will be highlighted by the Philly FED, leading indicators, and housing.

LONG TERM: uptrend

We have been hearing some reports this week that the FED is behind the yield curve, and rates should be at least another 1.5% higher at this time. We disagree. In fact according to the indicator we track for future FED funds, the FED is exactly where the market wants it to be at this stage of the economic expansion. In early 2011 we published the following report on short term rates, and what we track to anticipate them: https://caldaro.wordpress.com/2011/01/18/interest-rates-the-economy-and-the-1yr-t-bill/. Using the 50 basis point rule the current 1YR chart suggests the FED is right where is should be: 1.75% to 2.00%.

The weekly chart displays the SPX price action since the great recession low in 2009. The market advanced for 6 years, to 2015, to complete Primary I of a Cycle wave bull market. Primary II ended in early 2016 at SPX 1810. Since then the market has been rising in a Major wave 1, of Primary III, bull market. When Major 1 concludes, and it looks like we’re already in Int. wave v, a Major wave 2 bear market should follow. Our mid-2016 projection for this bull market remains SPX 3000+ by the 2018+.

MEDIUM TERM: uptrend

From late-January to early-April the SPX corrected in an Intermediate wave iv flat. This flat alternates with the Q2-2016 Intermediate wave ii irregular zigzag. In fact, even the Minor waves 2 and 4, of Int. wave iii, display alternation. From that early-April low the uptrend has been unfolding in what appears to be a nesting of 1-2’s.

We have labeled SPX 2717 in mid-April Minor 1, and SPX 2595 in early-May Minor 2. Then SPX 2742 as Minute i, and SPX 2677 as Minute ii in mid-May. This count suggests Minute iii has been underway since then. Over the past three weeks the SPX has risen an unimpressive, for a third wave, 100+ points. The market is still looking for a catalyst.


A quiet week as the SPX could not make much upside progress after hitting the OEW 2798 pivot range. In fact, on options expiration Friday the market sold off to SPX 2762 before recovering in the afternoon. The gap down opening and rebound could set things up for the SPX to start impulsing again internally. A rally to SPX 2791 again would help in that regard.

Short term support is at the 2731 and 2656 pivots, with resistance at the 2780 and 2798 pivots. Short term momentum ended the week with a positive divergence. Best to your trading!


Asian markets were mixed on the week and lost 0.7%.

European markets were mostly higher and gained 0.9%.

The DJ World index lost 0.5%, and the NYSE lost 0.8%.


Bonds continue to downtrend and ended unchanged for the week.

Crude remains in a downtrend and lost 1.0%.

Gold also remains in a downtrend and lost 1.9% on the week.

The USD has been in an uptrend and gained 1.0% on the week.


Monday: NAHB at 10am. Tuesday: housing starts and building permits. Wednesday: existing home sales. Thursday: jobless claims, leading indicators and the Philly FED.

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

About tony caldaro

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519 Responses to Weekend update

  1. vivelaamo says:


    I’ve heard it all now.

    Apparently this guy had a subscription newsletter!


  2. torehund says:

    Biotech finally broke out clearing 5000 on the index, bull💰🔝


    • tommyboys says:

      May run for quite a while. A few of mine have done zip forever – big bases – finally moving 👍🏼


  3. interesting day tug a war at 2770 big battle. one more low, or blast thru


  4. emuntrader says:

    only 7-wave up from 2743. possible -wave. we may still be in correction mode.


  5. stcoleridge says:

    Let’s see what this big bad “professional” money does in the last hour. It would be nice to see something creatively different like a rotation out of the R2K into the underperforming Dow, but instead I’m sure we’ll see more of the same buying of indices 50 basis points higher than where they could have bought them this morning. In the old days there used to be prop desks and hedge funds long to the gills waiting to give it to them.


    • Strongest 5 day correction. Late day rally once again. Higher close than open. Only kidding. Now that Trump had to reverse his separation policy you can bet your house he is angry. So angry he will take it out on the EU. Do I really know the man? We are about to find out!

      I will continue to play the man and not the chart. Silly as that sounds. next 5 days should be interesting.


      • tommyboys says:

        LOL – Trump has SMOKED your trading. He had you wrong at every turn. Holding long the past 19 months woulda had you WAY ahead HA!


  6. The quiet peaceful subdued market is about to be woken up. is this the longest losing streak in a long while? Tight range but reminiscent of a rolling top about to have the breaks let loose. All depends on todays close. This Berlioz piece should represent the current market well. From tenderness, ecstasy to despair, tantrums and murder.


    • tommyboys says:

      Man you’re king of the liberal drama agenda. How’s that been working out for you since the election 19 MONTHS ago 🤔🙄😜


      • Looks like the POPE even got involved again. The prior president and wife also. yes I would say we are hitting a PEAK when the outrage is from the LIBERAL POPE and CONSERVATIVE President. What just happened? Trumps evil mothers and drug dealing children with his tough zero policy now reversed? BUT all his supporters agreed with him? I suppose they still do. It’s called following whatever the dictator says and does. Please salute when you mention his name. He likes that.

        As for trade wars I find it rather funny that the BUSINESS NEWS from Forbes and Business insider consider this little spat troublesome. Expecting the market to resume higher with trade wars just getting going makes no sense. But ignore logic and stick your head in the charts. With the bias here they always see upside potential. To me it’s a screaming sell. Ludicrous to think trump reverses this policy. it has no visual pictures of screaming children and babies. No, he will get his trade war.

        I think the market at times like this, just like early 2016 is a great example of the individual having the upper hand. Markets are slow to respond to obvious concerns. The rolling drop has been suggested by me but I must admit I thought it would be much lower by now before the cascading event occurs. I can obviously be wrong here since its slide is so shallow with many indices showing strength. I say this is day FIVE of an assumed 10 day drop. Getting real close to a do-or-die pattern. have to see decided weakness form here on out. If I am wrong I lose a portion of the gains I made over last 2 drops. In fact this would be my third round of guessing in between the last one that might be wrong. no matter because i am sure how it eventually ends, with a test or breakdown of 254 area.




        • tommyboys says:

          LOL the louder the biased media screams (for ratings) the more it benefits Trump! Immigration is another screwed up lib policy that Trump will now have enough outrage – thx to leftist media – to fix bagging yet another victory thanks to the hating media hysteria. FINALLY kicked Strzok outta FBI. Morevto come and fingers crossed a Clinton indictment! Trump 2020 a lock now 🤒


    • stcoleridge says:

      Losing streak in one index of 30 stocks while other indices rip to new highs day after day. Even a brief acquaintance with the truth might be helpful.


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