Weekend update

REVIEW

The week started at SPX 2779. After gap down openings on Monday/Tuesday the market traded down to SPX 2743. Then after a gap up opening on Wednesday the SPX reached 2775 before heading back down to 2744 by Thursday. Friday had a gap up opening, which was sold in the afternoon, and the SPX ended the week at 2755. For the week the SPX/DOW lost 1.45%, and the NDX/NAZ lost 0.75%. Economic reports for the week were mixed. On the downtick: the NAHB, building permits, existing home sales, and the Philly FED. On the uptick: housing starts, leading indicators, and jobless claims improved. Next week: Q1 GDP revision, personal income/spending, and more housing reports. Best to your week!

LONG  TERM: uptrend

Lots of chatter this week about OPEC and Crude oil. In the end the Russian/Saudi cartel raised production 1m/bbls per day, and crude rallied $3. Guess the increase was less than the market expected. We last wrote about Crude in August 2016: https://caldaro.wordpress.com/2016/08/23/crude-and-the-commodity-cycle/. What was said then, at $45 Crude, still applies. We are expecting a bear market rally high to reach between $70 and $85 by the year 2020. Then Crude will turn lower, and probably return to $25 around the year 2026. Since Crude has already hit $70 (May18), the $85 level is more likely to occur by 2020.

Nothing has changed on the long term count, as you can see by the weekly chart below. A Major wave 1 bull market underway, with all but Intermediate wave v to complete. Intermediate waves i and ii ended in the spring of 2016. Then Int. iii divided into five Minor waves. Minor waves 1 and 2 completed in the fall of 2016, and Minor waves 3 and 4 ended in the spring 2017. After that a very long Minor wave 5, completing Int. iii, in January 2018. Int. wave iv followed with a 3-month flat ending in early-April. A choppy Int. v has been underway since then.

MEDIUM TERM: uptrend

While the general market has been in an uptrend since early-April, only the NDX/NAZ has looked impulsive while the SPX/DOW displays a lot of internal chop and overlapping larger waves. Guess one would expect this type of outcome, if they expected the NDX/NAZ to have a blow off fifth wave while the SPX/DOW formed an ending diagonal triangle. It’s a possibility.

Unfortunately there are a lot of possibilities at this time medium term. The long term target (SPX 3000+ by 2018+) remains on track. For now we continue with the short term count posted. The recent rally SPX: 2677-2791, appears to be just part of Minute iii, possibly a Micro wave 1 and 2.

SHORT TERM

While we do have a Minor 1-2, Minute i-ii, and now possibly a Micro 1-2 posted, we have been noting that the internal structure of these waves looks choppy compared to other uptrends in the bull market. Currently we have three waves up from SPX 2677 (2729, 2701, and 2791). After that three waves down, which may be a fourth wave flat (2743, 2775, 2744). SPX 2729 is a key level in this structure.

If the market rises above 2791 it starts to look impulsive. If it breaks down below 2729 the corrective activity continues. Short term support is at SPX 2742/43 and the 2731 pivot, with resistance at the 2780 and 2798 pivots. Short term momentum ended the week with a positive divergence. Best to your trading!

FOREIGN MARKETS

Asian markets were mostly lower and lost 1.6%.

European markets were also mostly lower and lost 0.9%.

The DJ World index lost 1.0%, and the NYSE lost 0.6%.

COMMODITIES

Bonds could be uptrending and gained 0.1% on the week.

Crude also could be uptrending and gained 5.4%.

Gold remains in a downtrend and lost 0.6%.

The USD remains in an uptrend but lost 0.1% on the week.

NEXT WEEK

Monday: new home sales at 10am. Tuesday: Case-Shiller and consumer confidence. Wednesday: durable goods and pending home sales. Thursday: Q1 GDP (est. 2.3%) and weekly jobless claims. Friday: personal income/spending, core inflation, consumer sentiment, and Chicago PMI.

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

About tony caldaro

Investor
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516 Responses to Weekend update

  1. jobjas says:

    DOW possible count

  2. Anne Day says:

    Getting more familiar with EW now. Thanks!

    Sometimes, I wonder whether President Trump visits here and looks around. He may say something like “Crazy! We are in iii of 3 of (3) now? Don’t like it a bit! Let’s make an announcement on trades to change it to i of 2 of (3) of ((4)) of (((5)))”. He may like a flush, too 🙂

    Just like to lighten up a bit. Good luck to all!

  3. phil1247 says:

    CL …

    as discussed last week

    ” straight up … or not at all”

  4. aahmichael says:

    Just noticed something. While I had counted 2791 – 2743 as an expanded LD, it turns out that the entire 2791 – 2699 can be counted as an expanded LD.
    2791-2762 = wave 1
    2783-2743 = wave 3
    2775 – 2699 = wave 5

    The bottom trendline remains the same whether you end the LD at 2743 or at 2699. If you count the whole thing as one huge LD, then today’s rally came just 1 point shy of retracing .382.

    • xuwu992000 says:

      That is my alternative count as well. But, I give it a low probability, as I don’t see the strength of W-2 to 2756 area, the 50% retrace — the minimum for a W-2 after LD.

  5. E says:

    The bear count is not complicated. We finished minor wave 1 which subdivided into 5 waves. We are now in minor wave 3 which could also be subdivided into 5 waves (where waves i and ii are now finished). Just a simpler possibility. If this is the case, should go down hard tomorrow in iii of 3.

    • E says:

      Correction: above should say “minute waves”… not minor. The terminating point of al this should be minor (3). Therefore tomorrow should be iii of 3 of (3) down.

  6. Billy says:

    DOW has been cascading down in an almost unlimited amount of waves making the down count hard to pinpoint at present. On the other hand the SPX still counts okay as 1, 2 & 3 down completed yesterday with today’s bounce the 4th wave which may linger for some time yet as 4th waves tend to do to allow for a reset before the final wave down. Note that the 1st wave down was a rather textbook expanding diagonal and the 3rd wave provided the weekend gap down which is quite characteristic of a 3rd wave. Today’s bounce on the cash index made it to the 38.2% retrace area of the 3rd wave thus leaving additional wave 4 footprints. Put altogether the likely near term prognosis is chop then drop.

  7. fenster6 says:

    Those that understand EW/OEW … could this be a forth wave of 3 and Tony’s count is still valid?

    \thanks

    • E says:

      I think the problem is that dow has fallen so deep it can’t be a 4. So… Unless the indexes really start diverging hugely it didn’t seem likely.

  8. schizo1688 says:

    I don’t read into charts that much, 20 to 30pt SnP move upward doesn’t make a difference to me anyway.. what you wanna catch is the initial gap down , that’s where all the meat is ..

  9. well. now comes the million dollar question. was the rally from 2698-2733 wave 4 with 5 down to come or only wave 1 from a 3 wave decline with waves 2 and 3 left to go higher. Hmm
    break 2712 and wave 5 under way break 2733 wave 3 under way.. at 2723 10 point either way
    good luck all, see ya tomorrow

  10. alexh110 says:

    Does rather look like this rally’s run out of energy.
    Possibly heading to sub-2698 tomorrow?

  11. this bounce is week. Cant even rally with DH extensions. short is the way to be, no giddie up

  12. kvilia says:

    jobjas, looks like CL count is incorrect. I am out of shorts.

  13. alexh110 says:

    SPX is sitting on an hourly RSI IHS neckline at the 2731 pivot.
    If it’s going to roll over into a deeper (sub-2698) low, it should start declining from here.

  14. gary61b says:

    ES had a long set up this am at 2714.75 level and hit target 2735. lets see if 2718 will be the next setup long or extension long MM if PB fails to 2718?

  15. It’s just a rebound everyone.Means nothing for tomorrow.A mechanical reflex is all.If 2729 meant anything,this rally should be sold.If 2729 meant nada,then forecasting the next few days,based on it means nothing as well.Gdx must rally to kick in the +div.A resell below 21.79,needless to say,is bearish.GL all.

    • Ashley says:

      I stopped out short and Im spooked, charts st are bullish, looking like we go to 2742 where I’ll reconsider, last post GLTA

  16. torehund says:

    Slowly the markt is turning to favorable, think we have to prepare for an upturn. Oil producers reving up to max as demand picks up and Venezuela an Iran are the back up resources. Having a good time here in Chicama Peru, into high season now with swells appearing frequently. Enjoy the week Tony + gang🍒🍒🍒

  17. phil1247 says:

    last one

    CL 70.02 target
    hasta!

  18. DAX has rolled over from up 25 to down 75.Our market following.Let’s see how low DAX falls to gauge our markets.Later.

  19. fionamargaret says:

    2465 is where we are aiming for….or 2340
    TZA, SPXS, SQQQ, SDOW, UWT, TMF, UGLD……..short the indices….and long oil, gold and long bond
    UVXY, VXX, TVIX if we resume going down….

    • alexhartley1 says:

      You may want to consider a little long BTC as well F. I am with you on the short S&P. If not tomorrow then Thurs. Expect fireworks.

      • fionamargaret says:

        Thanks Alex…how do you buy it…rookie here in BTC…

        • alexhartley1 says:

          Sign up to an exchange like Coinbase or Gemini where you can deposit fiat. Not all exchanges accept fiat. One day there will be ETFs and it will be easier but by then it will be a lot higher (though it’s definitely possible it goes lower at some point first).

  20. emuntrader says:

    Looks like a triple zig-zag.

  21. alexh110 says:

    Wrote this before I saw today’s pre-market action:

    This is roughly what I expect to happen next (see chart).

    We seem to have an expanded IHS on the hourly MACD, with the bottom of the head occurring at yesterday’s low.
    This pattern has only just become clear, and if confirmed, has resolved some of the muddle.

    Hourly RSI displays a tighter nested IHS formation. Expect yesterday’s drop to be fully retraced today to confirm.

    Projects a choppy end to Major 1 in about 6 weeks time (9-10 days up, 9-10 days down, then another 9-10 days up).

    Having seen the open, I now think the market could make a deeper low,today, before any uptrend commences.

    • Anne Day says:

      >>Wrote this before I saw today’s pre-market action:

      If one has to be this kind of vigilant, it is really above and beyond many of us mortals.

      In an annals of overused corporate clichés, few match the immortal words of Walter Gretzky, as passed on to the world through his son Wayne: “Skate to where the puck is going, not where it has been.”

      • alexh110 says:

        Thanks for your comment.
        I hope after today vigilance will not be required.
        The market action should confirm whether 2798 was a significant low.
        Then we should see an uptrend get going for the next couple of weeks.

  22. DH algorithm trading…IMHO (DH as well)…

    1. Currently /ES is in a counter trend rally (?) so far. Target is the 50% short at 2725.38. The 61.8% short is at 2730.40.

    2. If /ES trades above 2730.40 target is 2748.

    3. If /ES stays below 2730.40, targets are 2703, 2700.5 and 2693.54 (profit target).

  23. alexh110 says:

    Futures look more bearish than I expected today. Closed all positions, and will be standing on the sidelines to see what develops. May go cautiously long if an hourly +D develops.
    From tomorrow the downside risk should be much lower I think, due to symmetries in trends.

  24. garstall says:

    Fiona, what is Raymond James saying?

    • fionamargaret says:

      Garstall,
      I shall post today’s and yesterday’s ideas from RJ tonight….and hopefully Kimble and RJ will not be met by insensitive comments.
      I think we are lucky to hear what they have to say…..x

  25. mcgcapital says:

    FTSE made it back to 7550-7560. Time to get out of longs and switch short.. if this is a bear move this was just a retrace it will accelerate down now, need fresh lows under 7490 to gain confidence it will keep going down. If not, acceptance above 7560 and 7600 is likely so going to flip long if that happens.

    What I would say is we’re already down or flat 6 weeks in a row. This has been a very controlled sell off with big moves in both directions so hasn’t been suited to shorting and holding. Which is a contrast to the Jan-Feb move which was straight down. I’m starting to think it’s unlikely we get an all out collapse so a rebound might come soon, just have to see some higher lows forming for that though

    • mcgcapital says:

      Out of shorts for 5 point loss and long again now

      • mcgcapital says:

        Doing some whipsawing either side of the pivot here.. out of longs for -3. Short again now, stop above 7560. If that triggers I’m out

        • fotis2 says:

          A bit longer term looking for 7400s classic daily 3BR
          https://invst.ly/7uicw

          • mcgcapital says:

            I’ve got pivots at 7600, 7550-60, 7490-510, 7440, 7380-400 and 7300. Under there would be a serious collapse probably. Just taking it one at a time, we’re between 7490-7560 now so breaks above are bullish and breaks below bearish. Clear pattern of lower highs and lows though so no surprise if 7490 breaks before 7560. It’s for bulls to prove otherwise at the moment

  26. Ira sez about gold.A chance at a bear trap IF it can get above 1274 the next two days.Then maybe to 1291.The bearish setup,is another down day,which puts gold in a bearish 3 day stochastic.M8re likely.Tonight,the dollar is down again and gold is down $3 as well.Like watching paint dry,as I’m waiting for the phone to ring,while looking at my watch.Sheeesh.

  27. jobjas says:

    Now that the whole blog has turned bearish one is reminded of the saying ‘ most technical analysts turn bearish at the bottom and bullish at the top ‘. ( A recent example was CL when it bottomed for wave A at $ 63.43 everybody turned bearish with one even projecting $ 10 !!! & now all are bullish )
    One has to wait and see whether that saying is proved once again .
    Meanwhile continue to view SPX in a wave 5 ending diagonal going up in a 3 wave to complete 5 waves from 2009 bottom .

    • fotis2 says:

      I just trade patterns to me Crude was a solid short with decent R/R for 60 on break of Bear flag and got stopped out on the spike up
      https://invst.ly/7uar2
      I then look at Brent based on daily 3BR there is unfinished business at the lows which co insides with the neckline of bigger H&S
      https://invst.ly/7uaum
      There was no follow thru from Brent on Friday making me believe that CL spike was purely short covering.Looking for a daily reversal pattern to get in again for another leg down

    • JJ, do you think your SPX waves could be a Leading Diagonal instead of an ED?

  28. soulsurfer says:

    Getting confused by all the possible counts? I thought I’d summarize them for y’all.

    https://investingintelligent.com/2018/06/25/a-review-of-the-possible-elliot-wave-counts/

    Just my 2c, but please don’t get too Bearish here at these levels.

    • mcgcapital says:

      Hi Soul, if I’m reading right you’re basically saying there’s a 95% chance of holding 2680-2700 then new highs, a 5% chance of a low a couple of percent below the February one and 0% chance of a bear market already underway. That doesn’t feel overly balanced, it’s more like 50/50 whether it’s a bull or bear market at this point to me. This is the best chance bears have had post 2009 with the exception of maybe 2011 and 2015, and with the economic cycle maturing it needs to be at least considered as a valid option if being objective as we can’t definitely guarantee new highs

      • soulsurfer says:

        Correct. None of the long term economic and technical indicators signal a recession is imminent or already underway. As you said: the economic cycle is maturing but that’s not the same as contracting. There are of course 0 guarantees in the market, but such a bear would not fit with for example the NDX and RUT. Please see my recent posts and my daily market archive for those indices. They just tagged the 1.618 extension of wave 1 to the T and are now approaching the 1.00x extension: classic wave 3 and 4 behavior. That’s Means there is still a final wave 5 needed… this would fit better with a leading or actually maybe better an ending diagonal 5th wave for the S&P, which thanks to the DJIA has been kind of stuck in the middle.

        • Ashley says:

          Bulls are close to a bounce or die scenario, 2700 and 2680 and OEW says 2677, I say very ST 2660-2656 is key support… On the DOW 23800, COMPQ 7325, NDX 6725, all lower TL support and about the only bullish count I have left should it bounce there is an ED for the big wave 5, but bulls will call it wave 4 somehow =)….

          • Ashley says:

            To fade myself a little and give bulls and OEW hope Im still also looking for 2825-2850 to complete wave 3 of a very choppy wave 5 CYCLE V ED with a historic ATH to come .)

            • jobjas says:

              you change side like a chameleon !

              • Ashley says:

                Sorry, I meant I give the bears the ST odds to hit the lower TL support at the above mentioned levels with 2682 and OEW 2677 KEY to rally time to 2800’s short term, below is bounce or die time and I mentioned TL support as my line in the sand…. Then 2600 wave 4 triangle and one more EW count targeting lower should 2600 not hold, hopefully that clears things up?

    • schizo1688 says:

      i go with a bear porn…

      • Ashley says:

        The other is the wave 4 triangle with support at 2600ish, ABCXABC (X wave 2553 to 2717) with the C wave underway with a target of 2475 to start but until the above levels are broken I’ll give the bulls one more try and it is a historically bullish time of year .)

        • schizo1688 says:

          charts can deceive you, especially elliot wave, most of time you can’t see the big picture until 1/2 way into the decline or advance.. thats why it is still called a theory…

      • Ashley says:

        Still a VERY Schizo market to say the least =)

    • quickrick38 says:

      Thanks Soul. When there are this many counts I often refer to the ES to help sort things out. If my count is correct, we have at least a wave 5 and probably waves 3.4. and 5 to go which would drop us below 2680 but not below 2650. In fact, I’m not yet convinced that we finished the current wave iv.

      Consequently, I’m leaning towards your 2nd count but not a lock by any means.

      Welcome critique. Thanks.

    • aahmichael says:

      The nested 1-2s count is invalid because the DJI already exceeded the 5/29 low. The completed LD count is invalid because wave iv was an expanded flat, rather than the required zig-zag.

      The bullish count that you did not mention is a wave 1 up to the 5/22 high, followed by an expanded (or running) flat that is in the process of completing now. That means the 6/13 high was a wave (b)

      • mcgcapital says:

        Can you count 5 waves up to 2740 in May to allow that to be a wave 1? To me the only part of the rally since 2550 in April that looked impulsive was the last bit from late May until mid June. The rest just looked like a choppy mess. Aren’t the C waves sometimes impulsive waves, so that everything to 2740 could be an A, 2675 a B, then 2790 a C?

        I’m not an EW expert though, I’m just observing what is and isn’t allowed based on what Tony writes and the comments on here

        • aahmichael says:

          C waves are always impulse waves. In order to count 5 waves up from the 5/3 low, you have to end it at the 5/22 high, not the 5/14 high. The 2677-2791 move can be counted as a 3 wave subdivision or a 5 wave subdivision, so that wave can be impulsive or corrective. I’ve been favoring the ‘bear porn’ count, and will continue to do so until it’s invalidated. The only bullish count is the one I mentioned. It’s not something you see often, but it happens. On a longer term basis, you can see the exact same pattern on a monthly chart from the 5/2010 high to the 10/2011 low.

      • soulsurfer says:

        thanks Michael, but I wasn’t talking about the DJIA, which like TECH is likely in a different count than the S&P. Tech is for example following a nice and clean impulse pattern up.

        As far as I know there are no hard rules on what the 4th wave in an LD (or ED) must be. All there is “waves 2 and 4 are always corrective”. Corrective can be anything… In addition “wave 1 is usually the longest”, (not a rule) but “wave 3 cannot be the shortest among waves 1, 3 and 5” (rule). Here we have 131p, 147p, and 114p; respectively and thus meeting the rule.

        Regarding the bullish alternative you offer please review chapter 4 of frost & precther “ratio analysis”. In expanded flats, wave-C ends either 0.618x below A or is 1.618x A, measured from B. In rare cases its 2.618x A. Since wave-A was in this case 65p and ended at SPX2677, wave-c should ends either SPX2637 or SPX2685; respectively. The former target means the C-wave is 2.37x A, which doesn’t fit with the 1.618x or even the 2.618x Fib-extension. The latter target means the B-wave was (114/65) 1.75x the A-wave. However, the most typical corrective Fib-relationships in an expanded flat for a B-wave are 1.236x or 1.382x A. There may be a case of 1.618x A out there, but that’s even questionable. Lastly, expanded flats are of the 3-3-5 pattern and so far the possible C-wave down from the SPX2791 high is all but an impulse. Its an overlapping (3-wave) mess. Thus, with the B-wave too long, the C-wave in 1 out of 2 options too long, and the C-wave not an impulse (5 waves) I am not so sure this is a viable count.

        • aahmichael says:

          Soul, in regards to the corrective waves in an LD or ED, on Page 87 of Frost and Prechter, 10th Edition, it says: “Waves 1, 2, 3, 4 & 5 of an Ending Diagonal, and Waves 2 & 4 of a Leading Diagonal always subdivide as zigzags”.
          (Also, even if it could have been counted as a diagonal, it could just as easily have been an ED as an LD)

          In regards to the nested 1-2s count, one of Neelys’ rules that I always follow is that no part of wave 3 will ever violate the 0-2 TL. The current situation in SPX would violate the 0-2 TL.

          Finally, in regards to the proposed expanded or running flat, i don’t get hung up on Fib ratios. Sometimes the market hits them, and other times it doesn’t. A replica of the pattern I’m describing can been seen on a monthly chart from the 4/2010 high to the 10/2011 low, and also on a weekly chart from the 4/2016 high to the 11/2016 low. Both of those were running flats. The B-wave in the first example was 1.72% of A, which is basically equal to the current situation. Personally, I think this count has an extremely low probability for a lot of reasons, but it’s still valid at the moment, and it also puts the DJI and SPX in the same count. As far as the decline from 2791 goes, I count the initial move down to 2743 as an expanded LD, which could be a wave 1 or a wave A.

          • soulsurfer says:

            Thanks Michael, I stand corrected on the wave-2, 4 requirements in diagonals. My oversight. I don’t know who Neely is and I don’t mix other people’s “rules” with EWT. Otherwise EWT would have that rule included already.

            The 4/2010-10/2011 was not a running flat. I’ve never seen that entire price action labeled as a running flat. A simple 1,2,i,ii would suffice and simple is often best.

            The price action from 4/2016 to 11/2016 is indeed a flat, but it’s an expanded flat as B>A and C terminated below A. In a running flat C ends above A. See my NDX count for example, which most likely had a running flat ending early April this year.

            With today’s price action the S&P failed to make 5 waves down from the SPX2791 high. It can thus not be a C-wave down in an expanded flat as it is required to be 5 waves.

            The issue here lies in trying to fit an overlapping mess into a expanded LD 1st wave. Those are very rare and perma-bear stuff that doesn’t work in bull markets. Too construed. Simple is best: if it overlaps it’s 9 out 10 times not an impulse but simple corrective.

            Lastly, it surprised me you dismiss the Fibs -if they don’t fit the narrative- but then adhere to other rules that do fit the narrative. Fib’s are extremely important in EWT. Just check the recent NDX price action.

            Lastly, don’t try to form fit one index with another. Treat each on there own. Eventually they’ll get back in sync one way or another. Why otherwise not try to fit the S&P with the NDX?

  29. Billy says:

    Am liking Phil’s comment “2724 es area is a good place to put shorts back on”. The low of the day has some hallmarks of a B wave of an expanded flat. If so, the move off the low would be the C wave. New lows possible as early as tomorrow. IF the DOW and SPX are going to test the February lows then I believe NDX can do so also. On that index we currently have Int. III as the January high. This was followed by an A wave for the February low and then 3 waves up so far to a new ATH. Those 3 waves could be the B wave of an expanded flat. The B wave/A wave relationship is around 1.32 which is quite neat for an expanded flat and puts NDX presently in C wave of Int. IV. The drop from currently levels required to reach the A wave February low is 12.4%.

  30. fxaprendiz says:

    Before anyone tries to take my medium term bearish stance and extrapolate it into a crash call (which has happened before) let me mention again that I’m definitely bullish for the very long term, at least until the year 2035.
    Here’s how this current correction stands within my bigger timeframe waves count:

    Millennium wave 1, start year 1453
    Grand Super Cycle wave A:3, start year 1784
    Super Cycle wave A:3, start year 1932
    Cycle wave 5, start March 2009

    Primary wave A:5, start March 2009
    Intermediate wave C:3, start Feb 2016
    Minor wave 4, start Jan 29, 2018
    Minute wave C, start June 13, 2018

    Any decline below Primary degree is of no concern to me since it rarely ever triggers a recession.
    My labelling seems confusing since it’s my own flavor of EW, I usually just post the waves 3 and 5 without their further subdivisions but when someone finds apparent inconsistences in then I have to explain why, so now I just simply post my real count even though it seems giberish. Basically I always subdivide the main impulsive wave 3 into 3 waves not the usual 5, and sometimes the waves 1 and 2 as well depending on the wave degree. This results on my impulsive waves totaling either 7 or 11 subwaves not 5.
    So if you see something like A:3 or C:5 those are still impulsive waves in my system, as long as they have the 1, 3 or 5 numbers at the end of the label.
    Anyway what I want to convey is that to me this is still a correction 2 degrees below Primary degree, so crash callers I’m sorry but you won’t find an ally in me until 2035… (There will be a Primary wave B of 5 before it though, which will end this current bull, circa 2022, but it will be of the “garden variety” recession level, so not really a crash call either, and a second bull will take us to 2035)

  31. fxaprendiz says:

    I went short on the SPX three weeks ago (average of 2748) in anticipation of a wave C finally starting. It turned out I was a little early by about 2 weeks but when your time horizon is for months that’s a tolerable margin.
    I went quiet since then as my positioning wasn’t very popular then and someone in here even called it “madness”.
    I have now a better short position; closed my original short for a small gain at 2740 last week when the SPX made the first stab down, the reentered short at 2770 and 2778 on the rebound.
    Just closed the 2770 short at 2720 to lock in some profits and because I see a possibility of SPX trying a last run at the 2760-70 area before going down 2700 for good.

    My count now is a wave A down from the January high to Feb 09, and then a time consuming wave B until June 13, with its last subdivision being an Ending Diagonal from 2692 to 2791. With a truncated wave B and its subwave -c- an ED triangle, things definitely look bearish for SPX for the next few months.

    Looking for a final low in the 2490-70 area (now that A and B waves are done it’s easier to pinpoint a final target). The timing as always is the tricky part. If wave C takes the shape of an impulse then it should be done by the end of August; if it takes the shape of a zigzag then it can drag on for longer, possibly to the end of Sept, beginning of October.

    I mentioned a couple months back that patience was the name of the game, when most everyone else thought the bottom was in.
    Well, SPX has beaten me as well as I was expecting it to bottom by these last days of June, but with wave C just getting started until now, it seems to me 2 or 3 more months are needed before this lengthy correction can be called all done.

  32. NEWBIE says:

    Any of you guys been watching ticker IQ? Any thoughts on current wave pattern?

  33. travis01 says:

    Any educated thoughts on overnight? Sold my shorts before the bell and really still see my plan of 2600’s before any short term retrace…but they almost always pop it after a big down day. Maybe just sit out till morning but will be on flight early. Doc?

    • mcgcapital says:

      I have FTSE as more likely than not to pop up tomorrow as we’ve finished above the 7490-510 pivot area so could rebound back to 7560. If we lose that first thing then tomorrow could be a bloodbath but will assume it holds until it doesn’t. If Europe goes up then ES will probably follow for what’s probably a selling opp

    • phil1247 says:

      hi travis
      put shorts back on at 2724 after hours
      but only about half the amount that i took off at 2706
      risk is up to 2760 if ext breaks
      not willing to risk too much overnite

      • NEWBIE says:

        phil, your thoughts on Nasdaq?

        • phil1247 says:

          you can smile below 7085
          a break above there
          opens the door to the full retracement to the high

          you have waited along time for this NEWBIE
          enjoy!

          • Hello Phil. I’d kinda like to see this current ES bull flag play out and take us up to the 2750 area which should still be under the traditional line in the sand on this down move. The big boys don’t like to miss anything that happens on Mondays. But just my 2 cents.

          • chrisk44342 says:

            Hey Phil, given that section of NQ turf already traded in a prior short extension, I’m reluctant to re-use it. Not sure how much the rogue takes that into account.

      • travis01 says:

        yeah I like that area…pulled shorts off yesterday and expecting a small retrace up I shorted vix for AH but pulled it off by 8pm…Landing in N Orleans this morning and will likely look for small up to reshort…GL appreciate it

  34. E says:

    My count and timing models indicate sub 2680 over the next two days, then a two-day rebound, then straight down until July 13.

  35. Page says:

    I have no position yet but I do believe TVIX will be well above 100 (may hit 140) by the time mid-term elections and tariffs noise is over….. (will buy TVIX on next SPX bounce)

    • schizo1688 says:

      hey page , lets get in the ride of vxx tomorrow after the morning dead cat bounce… i bank $5 on it today

  36. mcgcapital says:

    I have a feeling that this isn’t going to be as easy as straight down to the Feb lows from here. If anything it’s impressive that we’re up here with all the trade rhetoric going on. I do lean towards the January high as being the high for the bull market, but this could go back and forth here for a few months before we actually collapse back down. In 2015 we kind of traded between 2000-2100 3 or 4 times before we eventually went back down to the lows and some. I can see a possibility of the market holding 2680 or 2700 for a while here. But there’s also the possibility of a direct drop too. Need to stay nimble, short below today’s lows, possibly a long above there.

  37. vivelaamo says:

    If today was the bottom and I admit it’s a big IF I think the DOW will lead the rally. Been hammered in the past week or two. First things first need to get back above the 200 dma. I’m long with a stop below today’s low.

    Well done to those that stuck with there bearish calls once a breach of 2800 failed. Been a good few weeks for you.

    • Anne Day says:

      >>I’m long with a stop below today’s low.

      Took your profit already? Or thinking about waiting for some further ride?

      • vivelaamo says:

        I took some profit and moved the rest to break even. To be honest I thought it would probably go below yesterday’s low before it rallied. Refreshing to see it didn’t.

  38. phil1247 says:

    chris
    im sure you know this already
    but 2724 es area is a good place to put shorts back on again
    double ext short

  39. 123 abc says:

    Taking out the Feb low may suggest a bear market underway.
    Last possibility for an ongoing Intermediate-iv wave as follows…


  40. xuwu992000 says:

    @@ Whoever shorted BA & AAPL last week, as I recommended, should have made a killing today.
    @@ The decline from 2793 was indeed an expanding leading diagonal, an almost textbook pattern. After a quick snapback of more than 62%, the next leg is on. This current wave, either W-C or W(3), would be at least 262% of W-A or W(1), which means it won’t pause until 2640 area. KEY WORD here: “At least.”
    @@ China’s monetary easing move initiated yesterday was a strong signal that it will fight back hard, and never yield an inch more. As I pointed out last week, Xi was pissed and angry. Why I suggested that to short BA & AAPL is a safe trade: AAPL sells more I-Phone & I-Pad in China than in the U.S., and 30% of BA’s planes were bought by China. An easy math, and an easy target.
    @@ The most important phrase in China’s official announcement for retaliation is “comprehensive”; we already see that Yuan has devalued significantly over the last week or so; I won’t be surprised to see a strong wave of movement to boycott American products, i.e., APPLE, etc., from those nationalist groups in China. Let’s see who is naked in the end.
    @@ Holding SPXS from 2780. My next turning date might be the bottom of this leg. It has been validated by the June 19 low. Caution: Don’t try to catch this falling knife.

  41. aahmichael says:

    Today, SPX filled its gap from 6/1. The 96% probability of that happening was too much for the bulls to overcome. The other “tell” during the 8 day rally that began on 6/1 is that SPY volume fell completely off the table during those up days. 3 of those days were the lowest volume days of the year, and 2 of them were the lowest volume days since the day after Thanksgiving, which is essentially a holiday. That’s surely not what should have happened during a supposed 5th wave upside breakout from a 4th wave triangle. Today’s volume in the first 2 hours exceeded the total daily volume of 6/4.

    Current ST SPX count is as follows:
    2791- 2743 = wave i (an expanded LD)
    2743- 2775 = wave ii
    2775 – = wave iii in progress.

    If anyone took the short trade setup that I posted on 6/13, I’ve lowered my stop to 2760. Until the market proves otherwise, my expectation remains that the current wave down from 2791 is a wave C, and will go to at least 2451, so I will continue to give it lots of room to breathe.

    • xuwu992000 says:

      Agree with your count. Though there is a potential this w-iii might be a w-c.

      • aahmichael says:

        I’m sure you also noticed that today’s lows of 2702 and 2699 on the 60 min chart both stopped that the lower TL of the expanded LD.

    • schizo1688 says:

      Thanks aamicheal ..

    • Your analysis has been the most interesting for me. Not because you see a drop of such magnitude but because you analyze all sides and weigh the results. No matter where we end up and how fast I see a continued drop till end of tomorrow or within a few hours of Wednesday.

      Does symmetry play into your decision. We all know the 21 to 24 week correction scenario where a bottom is most likely found then. The pattern showed a clear 2 week window of steep drops from the last 2 times and now we seem to be in the final drop. Can we deviate from the 6 month pattern by much? Or is this just a fools game trying to find symmetry in play. For me my best gains has been when I see a pattern.

      https://www.investing.com/indices/us-spx-500-chart

      • The chart I am referring to is the WEEKLY chart.

      • aahmichael says:

        I don’t worry about symmetry. Sometimes it’s there and other times it isn’t. Even though this week is normally a seasonally bullish week, and even though indexes like the Dow are extremely oversold, what has influenced each end of month decline this year has been QT, and that occurs next Monday, so I sure wouldn’t want to be long in front of that.

        • Thank you, i will keep that in mind. BUT, will they allow a steep drop going into July 4th? Have we ever seen a drop going into such a holiday?

        • mcgcapital says:

          I’ve noticed that when the market is bearish or sideways, it does feel like there’s a pattern of selling into month end. And that pre-dates QT as it used to happen in 2015-16, then the pattern disappeared during the 2016-17 period when liquidity was plentiful and we just went up nearly the whole time.

          I’m not sure how much is QT directly affecting things or how much is to do with portfolio positioning for month/quarter end. This year every month ended bearishly apart from March which was also a quarter end. Ideally want to see it blast through 2700 to gain confidence that we won’t just bounce around some more here. But ultimately the whole structure looks bearish whether it’s directly or after more failed rallies.

          QT is definitely contributing to this low liquidity trading environment but I’m not sure it’s a 1 for 1 in terms of moving the market as after all it’s still a relatively small amount vs market cap.

          • aahmichael says:

            Here are the swing highs this year:
            1/26, 2/27, 3/13, 4/17, 5/14, 6/13
            Here are the swing lows this year:
            2/9, 3/2, 4/2, 5/3, 5/31

            There is a definite pattern and it coincides with QT. I have no doubt that had the 6/1 NFP report not been a blowout, then the swing low would have occurred on 6/4 instead of 5/31.

            • mcgcapital says:

              For the March one I was thinking we had a low on the 23rd at 2585 which was also the day Europe bottomed, then it managed to make it back to 2650s by month end, closing at 2635. First day of April was a bloodbath though and saw a lower low in the US while Europe was closed for a bank holiday

    • travis01 says:

      I wasn’t looking quite that low but I like the analysis. What vehicles do you like to play (q’s, vix products, etc)? I noticed vxx outperformed uvxy today.

    • Lars Johansen says:

      Is 3 done at 2699 and retrace to 2731 pivot. OR what do you think. 3 down to 2656 pivot ? Thx

  42. alexh110 says:

    I notice we have an hourly and daily +D on the Dow now.
    Quite confused about the medium term count at this point. Hopefully tomorrow’s action will start to clarify things.

    • alexh110 says:

      Pretty sure today marked the head of an IHS on hourly MACD and RSI.
      Suspect the market will trend generally higher for the next 9 days, due to the time symmetries involved.

  43. Tony: positive divergence did not help too much today, and Key 2729 broken, 200 day on the Dow broken. kind of ugly…Tom DeMark indicators gave a 13 set up last week, potential to break 2705 support SPX/50 day and test of Feb lows around 2600..if 200 day broken…wow!…

  44. torehund says:

    Dow doesnt want to hock on weekly macd. Interference from daily oscillator persists, be patient😖

  45. fionamargaret says:

    2465 is where we are going….through 2632, 2532….if 2465 does not hold…. 2340

  46. gary61b says:

    ES possible 2694 level as a reversal level with 2669 as LIS. below 2660 and the bulls look done.
    above 2660 and could be the D wave of the LD for wave 1 and for it to end near the Jan, high.

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