Weekend update

REVIEW

The week started at SPX 2902. After Monday’s Labor day holiday the market had gap down openings on Tuesday, Wednesday and Friday. Each day of the week the SPX made a lower low: 2885, 2877, 2867 and 2864. For the week the SPX/DOW lost 0.60%, and the NDX/NAZ lost 2.75%. Economic reports for the week were mixed. On the downtick: auto sales, the ADP, factory orders, and the trade deficit increased. On the uptick: monthly payrolls, ISM manufacturing/services, construction spending, and weekly jobless claims improved. Next week’s reports will be highlighted by the CPI/PPI, retail sales, the beige book, and industrial production. Best to your week!

LONG TERM: uptrend

The indices we have been tracking did not make any upside progress this week. In fact all of them lost ground as the market pulled back. The DOW was down 0.2%, the NYSE -0.8%, and the DJ World -1.9%. We still expect all three of these indices to make all time new highs, just like the SPX did recently, before the bull market ends.

The long-term count remains the same. A Major wave 1 bull market has been underway since February 2016. Major wave bull markets consist of five Intermediate waves. Intermediate waves i and ii completed in the spring of 2016. Intermediate waves iii and iv completed in the spring of 2018. Intermediate wave v has been underway since that April low. We still expect the SPX to reach 3000+ by 2018+ before the bull market ends.

MEDIUM TERM: uptrend

The Intermediate wave v uptrend entered its fifth month this week, as it started in early April. We are expecting the uptrend to unfold in five Minor waves. And it appears those minor waves are quite lengthy and subdividing – the reason for the length of this uptrend.

Minor waves 1 and 2 ended in June at SPX 2791 and SPX 2692 respectively, and Minor wave 3 underway since then. Currently Minor 3 (225 pts.) is slightly shorter than Minor 1 (237 pts.), and also does not look complete. We have been counting SPX 2863 and SPX 2802 as Minute waves i and ii, and the SPX 2917 all-time high as the first wave of Minute iii. See hourly chart below. SPX 2917 could have actually been all of Minute iii, even though it is quite short compared to Minute i. Suggesting Minute v would also be quite short, and probably top around the OEW 2929 pivot. If the SPX drops below 2863 that possibility is eliminated.

SHORT TERM

As noted earlier Minute waves i and ii of Minor wave 3 completed at SPX 2863 and SPX 2802 respectively. Minute wave iii has been underway since then. While Minute i subdivided into five quantified waves. Minute iii has thus far not subdivided at all. It has been one straight up rally. Leading us to believe it is only the first wave of Minute iii, and this pullback is wave 2.

After this pullback concludes the market should rally to higher all-time highs. Short term support is at the 2858 and 2835 pivots, with resistance at the 2884 and 2929 pivots. Short term momentum ended the week with a positive divergence. Best to your trading!

FOREIGN MARKETS

Asian markets were all lower for the week and lost 2.0%.

European markets were also all lower and lost 3.0%.

COMMODITIES

Bonds continue to uptrend but lost 0.4% for the week.

Crude appears to be in an uptrend, but lost 2.9% on the week.

Gold appears to be in an uptrend too, but lost 0.5% on the week.

The USD appears to be in a downtrend and lost 0.1% on the week.

NEXT WEEK

Monday: consumer credit at 3pm. Tuesday: wholesale inventories. Wednesday: the PPI and the Beige book. Thursday: jobless claims, the CPI, and the budget deficit. Friday: industrial production, retail sales, consumer sentiment and business inventories.

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

About tony caldaro

Investor
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292 Responses to Weekend update

  1. vivelaamo says:

    Oh Mr Kendo oh way oh way oh way!

  2. combination of buy the close and cover your shorts should push to 2895 then as always simply gap over resistance in the morning. new highs by Friday.
    See ya tomorrow.

  3. lml25 says:

    GDX is still embedded.Close to exiting,but a selloff into the close would make the whole day a mirage.Ira mentioned gold,over 1212.70,opens the door to higher price counts–1219 and 1240.That’s it from here.

  4. lunker1 says:

    sharp -D at 2895
    strong enough to cause pivot to fail?

  5. as long as 2884 holds bulls are golden. break 2884 bears have a chance

  6. kvilia says:

    Page – good call. I missed it 😦 Waiting for a pullback. Looks like a great move is brewing in commodities and currencies.

  7. fxaprendiz says:

    This is why I don’t day trade. The unsuspecting intra-day traders would have been whipsawed on both sides with today’s price action in SPX, if they were trading based solely on momentum. Much safer and easier to play the weekly swings from the extremes and the medium term.
    Still comfortably long from last week at 2869-72. Once SPX starts trading above 2900 again I’ll be on the lookout for signs of exhaustion.

    • Jack kendo says:

      B at 0.435, even could not reach 0.50, not to say 0.618
      C too deep at 0.949, more than 0.886
      too week for B and C
      D at 0.583 could not get to 0.618, or 0.786 (at 2905)
      both $SPX and $NDX bounces stopped at the red trend line, bear flag line.
      $NDX, even weaker, leading down.

      fyi, my averaged shorts cost base 2902, after two rounds of successful hedge trades.

      cheers!

      • fionamargaret says:

        When I mentioned I thought we had reached an inflection point, retesting the breakout point and continuing lower, I did not know how low, but suggested 2858 or 2835
        I still think nothing materially has changed, and there is further downside….2832 is an interesting number in the sequence.
        And yes TLT and TBT are much of a muchness….equilibrium.
        GLD is still down to 95, and GDX to 13….a real washout.

        • fionamargaret says:

          Oil has changed sequence and suggests 83.
          Remember “all things being equal”….so oil might have factored in the hurricane into the permutation, so it is more tenuous/volatile

          Remember an inflection point exists when a function changes concavity.

      • fxaprendiz says:

        Jack, I don’t know how much experience you have with harmonic patterns, but there’s usually some symmetry in them. While the XA leg is usually the longest one, the sum of B, C and D legs should be at least as long. XA took 7 trading days to form, and from A there’s only 3 days so far so I think there’s more before any harmonic patterns finish forming. My eyes are on your 0.786 at 2905 and on the 1.272 fib at 2931.
        Of course SPX doesn’t really need any small harmonic pattern to head down now, the huge bearish pattern since January 29th is more than enough, if SPX is going to head south eventually.
        Congrats on being short on average 2902, it’s a good long term position and I’m sure you can and will weather any upmove above it if it were to happen before the downside starts again.

        • Jack kendo says:

          fxaprendiz, you are correct about the symmetry and time.
          the harmonic pattern should have 2~3 more days to complete the pattern.D leg could be between 2897 ~ 2905.
          cheers!

  8. Page says:

    I think we will have sell the news event for AAPL’s new phone announcement, profit taking kicks in.

  9. Theodore Lerts says:

    Bullish. I’m serious. This is going to be even better than last year’s hurricane money. Almost not even fair how easy this is.

    https://abc11.com/weather/hurricane-florence-remains-category-4-track-pushes-farther-south/4219580/

    • torehund says:

      Sometimes bad is good for someone somewhere….Venezueal would catch a bid with 200 Usd oil, Iran too would blossom and a peace agreement would be hastened. Nukes are for bad times, in good times a non issue. Prayer to those who suffer, but good forcasting makes for ample time to evacuate. Surfers on the other hand, well they are salivating for the exellent waves it brings. Nature is what it is🤔

  10. gary61b says:

    ES possible LD from the 2865 low with 5-3-5-3 and with e, I see 1,2 and working on 3 then 4 then 5. ? https://www.screencast.com/t/JsgMHixzaCth

  11. lunker1 says:

    SPX is churning butter
    Today looks to be the inverse opposite of Friday

  12. re tested the lows and off higher or are we going to break 2879 and drop. doesnt look bullish to me but what do i know

  13. stcoleridge says:

    10,000 or 7320 that is the question.

  14. Lee x says:

    Sorry guys I fat fingered it a bit too much there

  15. scottycj1 says:

    J Kendo Aka JK Aka Just Krazy

    Still looking for 2727 today ?

    • mcgcapital says:

      You’re still long from 2910s aren’t you? Can tell with the emotion. You have enough on with managing your ill disciplined trading without going after others for getting one wrong

      scottycj1 says:
      September 3, 2018 at 11:00 am
      I always use stops…..you just like to make things up. Your going to get your short
      arse handed to you in the next few days…..then YOUR stops will get hit. LOL !

  16. Page says:

    Gold miners squeeze is on.

  17. phil1247 says:

    es

    tight bull/bear demarcation continues unchanged from yeaterday

    go with the winner

  18. asaraniti says:

    Good morning traders….
    Bottom line /ES 2897.50 is the bull/bear line in the sand. /ES has been testing and defending a 50% short since yesterday afternoon. /VX is testing and defending a 50% long. From a day traders perspective….a slight edge to the bears but waiting to see what the market’s true intentions are. Again /ES2897.50 is my bull/bear line in the sand.

    Yesterday might have been a short squeeze as large traders had to buy back the September contract. The question is are they going to buy or sell the December contract? Will get additional clues today but tomorrow is the “unofficial rollover day” in that large traders will be out of the September contract and they will trade the December contract. DH charts.


  19. mcgcapital says:

    FTSE short term parameters are the same as yesterday really. 7260 support, 7290-7300 resistance. So selling into 7300, switch long if that breaks up. Buying into 7260, switch short if that breaks down. But ultimately needs to take out 7220 for further downside. I’m not overly impressed by the price action so think if might resolve lower.. would rather it didn’t as it’s easier to trade when the ranges are mid sized rather than huge. But still seeing global equities as going lower intermediate term unless something changes in how it’s acting

  20. CampFreddie says:

    Adding to long positions Dax @12023 and Ftse-100 @7284. Good set-ups here imo as per my previous charts, and I believe I am seeing quiet accumulation in these mkts. Aimho Glta.

  21. Jack kendo says:

    poor market breadth
    Nasdaq breadth down on an up day! worst is to come.

    cheers!

  22. ttsden says:

    JK your eagle eye = cl &spx trendlines are telling. Tks

  23. Jack kendo says:

    cold winter, sudden freeze

    TVIX: short term best performance expected

    Long term:
    sqqq
    $SPX short: 2868, (2883-2864), (2882-2867): Average 2902

    cheers!

    • torehund says:

      On wti, from top in 2008 you have depicted a double abc down, where the last abc is skewed to the upside from bottom in 2016 until now. The latter structure looks very impulsive and not like a corrective abc, opening up for a 3 of 3 up to be expected and oil going skywards. Thats my 5 cents🔝

        • torehund says:

          Martin coined peak inventory 86 years approach 2 years ago. Inventory has decreased therafter, could be a clue😜 Anyone should know the risk involved an EW saus correctly 50 percent at this major inflection. Good luck all, for someone Quick on their feet like phil could opt for going with the winner. But the winner is a fast runner😁

          • jobjas says:

            wonder how people trade daily looking at monthly charts . On hind sight the chart looks perfect to exit provided one got in the bottom. Unfortunately most retail enter right when the prices are about to turn .
            btw CL will top around 85-90 before any significant correction

  24. fionamargaret says:


    Thanks Chris Kimble

    https://raymondjames.bluematrix.com/docs/pdf/69daecf5-50ad-4d68-9e7e-3648b17e9093.pdf
    Thanks Raymond James

    Thanks and love to Tony…..and everyone xx

  25. torehund says:

    Looking on $Brent, daily macd is attempting a bilobar upthrust, and weekly macd almost bullcrossing. Weekly macd histogram could go positive, all good. If this really decides to pan out prepare for much higher prices to follow🎰

    • ttsden says:

      Yup Torehund
      Same , same with WTI, besides biggie discount nearly $10.00 to Brent,
      Looks like trend reversal in less than 1 hour !
      Jobjas.. do you believe it?
      cheers

  26. lunker1 says:

    Tony to continue from below, gap openings are more frequent at inflection points? Is this part of OEW, just a mental note you’ve seen from your many observations or something that you’ve backed tested in history?

  27. bear bull fight is on into the close. Who wins. Bears need a 5 point down push. bears just need to hold serve here at these levels

  28. fxaprendiz says:

    2 weeks after posting the latest bearish pattern in SPX nothing has really changed my medium and long term views, if anything price action is confirming them. SPX still trading within the Potential Reversal Zone with bigger risk to the downside than the upside.
    Short term though, the bounce I was expecting seems to be on its way after SPX testing last week low. Really the only thing imho that is still in the air is whether said bounce will be high enough to print a new ATH before the reversal down. I was thinking of the end of this week for the bounce to end but now it seems that’ll happen at some point next week.
    My 2 bearish counts still valid as 2864 wasn’t taken out. So a lower high or a higher ATH are still 50/50. Cycle-wise, the end of September definitely looks like downside action.
    Still keeping my longs at 2869 and 2872 from last week, just waiting for the setup to reverse short.

  29. H D says:

    Tony, int i/ major 1 in 2016 came from a February low and rallied into Sept. (377) fib rally

    Some TIME symmetry with int v this year?

  30. Page says:

    Short squeeze is coming in gold miners GDX, GDXJ, NUGT, JNUG. Be prepared for unexpected.

  31. phil1247 says:

    Scotty
    tight bear/bull demarcation
    even this extension target cant get us above 97.5 resistance

    scotty we need more power ……. give her all ya got

  32. Jack kendo says:

    Fiona, Re: TVIX

    SPX a few points higher than 2887, no big deal.
    timing adjusted due to morning hedge. no hedge needed anymore.

    Jack kendo says:
    September 11, 2018 at 8:38 am
    if the wave count is correct, 2866.78 should be the low for the day, and we need to rise to 2887 one more time. so you know what to do …
    cheers!

  33. scottycj1 says:

    Jack kendo says:
    September 10, 2018 at 9:58 am

    Fiona, by checking the setup, I have SPX 2727 mid of this week.
    if went through 2727, larger crash possible.
    cheers!

    163 Spx points down by tomorrow ??????

  34. stan911 says:

    Looking for 2894-26033 Dow then down to 2846-25637 and of course stops just above GL

  35. Theodore Lerts says:

    Bottom is in. I’m long big time here. Good luck everyone.

  36. fionamargaret says:

    GDX to 13
    GLD to 95
    TVIX, VXX

    • fionamargaret says:

      TLT/TBT are in equilibrium…in other words no defined breakout in either, but TMF (sometimes the 3x gives a clearer picture) suggests 23/24, so that is why I give TLT the advantage.

      2858, 2835 and 2800.
      Well we re-tested the high, and lower…do we continue to 2858 where there is strong support….then down further….

    • fionamargaret says:

      TVIX is at the base of its pattern……as is VXX.
      The numbers suggested down correcting….

  37. kvilia says:

    Phil,
    GDX is getting close IMO.

    • phil1247 says:

      unfortunately went thru 17.50 target entering new extension short

      targets below are still 16.48 and 15.47
      unfortunately took all profits on DUST
      now …. i got nuthin jerry .. nuthin

      • phil1247 says:

        before you consider buying gdx
        look at the monthly chart
        its in free fall outside the lower boll band
        10.38 target is still possible which would mean new bear market lows

        as mentioned many times kvilia…..
        gold has probably seen its bear market lows
        silver and GDX may not have

    • lml25 says:

      Close to zero…lol.The thing is embedded.A Fed rate increase or a China trade solve are the only two items that can reverse the dollar and gold(or Kudlow resigning).Throw China out.The Fed?That’s the only hope.Hestitating on further rate increases.That’s not until Sept 26th.A lot of air beneath GDX until then.Central banks are selling gold–as usual.Good luck all.

      • fotis2 says:

        From 2006 Dec marked the low followed by a multi month rally except for 2011 and 2012 and of course last year where it basically went sideways

    • fionamargaret says:

      Kvilia, I know you were given poor information…if someone would like to back check.
      Why I am suggesting this is I would like those of the female variety to join, and not be harassed.
      Ashley felt she had to get her own website after being told she had too many postings, and I suggested she stay…probably one of the brightest talents.
      Now Phil said “see ya” at 8.46, and is back for encores, and all over everyone’s work.
      Please….

      • kvilia says:

        I am not sure I’m following, Fiona. You have your progression method, Phil is using DH method, and I can swear that holding overnight for me rarely worked – two weeks of great gains are usually wiped out with one swoosh down that I cannot control overnight.
        I made a great call today (5% on JNUG) but did not follow through on it again making a mistake of thinking long time frame. Quick 4 hr in and out would have made me 8K today with a stop to loose $400. Not interested any more in anything that requires holding overnight.
        Cheers,

        • fionamargaret says:

          I am not questioning your method Kvilia…you are much too smart for me to try and do that.
          I find Phil seeking you out and then suddenly you are left holding oil or gold or whatever (while Phil always has “profits”) is exactly what happened with Fotis, until he started just ignoring him…and look at him now.
          If Phil is limited in his postings, this kind of thing cannot happen, and other posters who have very valuable insights can actually be found and read.
          Look at yesterday and the weekend, it was actually easy to read everyone…and no derogatory comments to deal with.
          Limiting the postings during market hours and the weekend would work.

  38. fotis2 says:

    fotis2 says:
    July 31, 2018 at 2:25 pm

    https://invst.ly/851wf
    To the tick.
    https://invst.ly/8kvmt

  39. could also be wave 3 on its way up to 2929 pivot. to end minute 3 or worse. guess 2897 needs to be broken up to confirm. up from here to 2890-2897 i suppose and see what happens then
    tough market

  40. Jack kendo says:

    if the wave count is correct, 2866.78 should be the low for the day, and we need to rise to 2887 one more time. so you know what to do …
    cheers!

  41. gary61b says:

    ES, not the sequence I was looking for, I was thinking 2890/92 first then down to 2869.75..lets try
    2870 then to 2890/92? Gap on spx should fill at this level.

  42. mcgcapital says:

    Think the medium term inflection point for global equities passed about a month ago when Europe and EM broke trading ranges lower. Been obvious it’s going to go down since then. Going to be a struggle to get everything rallying together. Wave 3 of 3 to the downside soon maybe. Will keep an eye out to see if the set ups change but that’s the odds on one at the current time

    • Anne Day says:

      You seem to have a “socialist” way of thinking 🙂

      I think that the reality is more like the rich getting richer and the poor becoming poorer.

      Not sure about midterm inflection point. The long term one passed many years ago.
      IMHO, the only country that has a chance to compete with US now is China. That’s why we are having this trade war with China. Of course. the biggest enemy of US is always itself; it will likely just destroy itself given its evolving demographics.

      • mcgcapital says:

        Lol not sure what politics has to do with my post but for the record I’m a right of centre conservative… but don’t believe in punishing people for being poor or cutting off social mobility, economies function best when everyone does well. In the warped American political world that probably makes me a communist, but hey

        As for the markets, I’ve done my best to explain what I think’s going on based on a decade of experience in fund management/investment banking. Since I said this stuff about the regional divergences a few weeks ago I’ve seen nothing to suggest I’m wrong and the markets have reacted as I expected. I’ve not seen anyone put forward a valid counter argument to my posts, it’s mostly just been blind patriotism ‘it’s because America is better than everywhere else’ or complete ignorance around how liquidity in markets usually functions, historical precedence, or some outdated views on how integrated the global economy is, or a lack of understanding of how earnings are distributed by region.

        People can laugh all they want, but this so called ‘socialist’ is living the capitalist dream making lots of money 😉

      • ttsden says:

        Anne. Insightful and learned comment. Good view. More wisdom please . Tks

  43. phil1247 says:

    Tore

    bonds ( ZB) appear to be entering post triangle thrust down
    if so ……… time to increase TBT positions

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