Wednesday update

SHORT TERM: flat opening, DOW +28

So far this week Asian markets have lost 0.9%, and Europeans markets have gained 0.9%. The SPX started the week at 2872. Monday’s gap up opening took it to SPX 2887 early before heading lower. Tuesday’s gap down opening dropped it to SPX 2867, and then the market started to rally. Today the market opened flat, rallied to SPX 2895, then headed lower. A choppy week so far.

It has been two weeks since the SPX hit an all-time high at 2917. After a drop to SPX 2864 last Friday, a week and a half after that high, the market rallied on Monday, then retested that low on Tuesday. This is a long period of time for what we thought was just a Micro 2 of Minute iii. Other Micro waves have lasted 1 week at best during this uptrend.

In the weekend update we did note SPX 2917 could also have been the high for Minute iii of Minor 3. This is possible as long as the current pullback does not overlap the high of Minute i at SPX 2863. So far the low is SPX 2864.

Now a third possible count, we’re being objective, has revealed itself. It is possible this entire uptrend is not Intermediate wave v, but Minor wave 1 of Int. v. If so, we can count a potentially completed five Minute wave advance from the Int. wave iv low: 2791-2692-2863-2802-2917. Clearly this market has reached an inflection point. However it resolves itself, the bull market is still underway and new highs will be made in the weeks/months ahead. Best to your trading!

MEDIUM TERM: uptrend inflection point

LONG TERM: uptrend

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

About tony caldaro

Investor
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220 Responses to Wednesday update

  1. fionamargaret says:

    https://www.mcoscillator.com/learning_center/weekly_chart/what_happened_to_the_eurodollar_cot_model/
    Thanks Tom McClellan

    Thanks and love to Tony……and yes, everyone xx

  2. jhjoyner says:

    Spx weekly closed ATH. Good week!!

  3. torehund says:

    https://www.investing.com/indices/low-carbon-100-eur-net

    …the new mania ?, trades in Amsterdam just like the Tulips used to do….

  4. garstall says:

    Hi Tony. Looking forward to the weekend update. Do you pay any attention to the Hindenburg Omens? Thanks.

  5. lml25 says:

    As I mentioned the other day,trade war news jumps the dollar up–kills gold.Today,GDX not getting crushed–yet.Have to watch for a divergence.GLD holdings down to a new low…742 tons.Nothing bullish here as of now.GL all.

    • mjtplayer says:

      If gold can’t rally into Oct then it could be toast into year-end as managers will be selling anything gold related for year-end performance chasing and window dressing. Look for a potential major low/bottom in gold and PM’s in late Dec or perhaps Jan ’19

  6. gary61b says:

    My short term charts, the top two hit the ceiling and could not go any higher so they bounce down looking at 2901.5 for a bounce back up and continue up. Lets see!

  7. NEWBIE says:

    Market will be trading at 2810 by end of next week

  8. mcgcapital says:

    Well lower high now and turned. Still needs to break this persistent up channel and fully retrace a rally leg before it can be called bearish, but this price action isn’t healthy for bulls IMHO, and it’s a matter of time. Europe rally looks like it could be done and heading back down again now.

    As for market breadth, the divergences are already there. Doesn’t show on the A/D line, but I don’t like it as a measure of breadth on the basis that it simply counts the number of advances and decliners. So it basically just means that small caps are doing well. The A/D line divergence works as an indicator under normal market conditions on the basis that when certainty around US economic conditions becomes less clear, investors cut back exposure to small caps and favour more stable and liquid large caps, so the overall market rises still while the A/D line diverges. Only problem with that is that this time around, the issues for markets aren’t caused by the US economy, they’re caused by the fed exporting tighter financial conditions to the rest of the world. Global growth ex US is slowing down as a result, so investors have herded into areas of markets that are exposed to the US domestic story, with small caps being one such area. If markets are going to go back up, you need the fed to ease off on tightening and QT. Nearly every move post 2009 has been about liquidity and this is no different. Even if Trump resolves the issues with China the big problem is still there.

    The attached shows some alternative measures of breadth and they’ve been weakening for a long time. https://northmantrader.com/2018/09/02/lying-highs/amp/?__twitter_impression=true. And that’s just for the US market, would be much worse on a global basis which is always the most important for the health of risk assets.

    • Anne Day says:

      I took a bit of time today to study FTSE.

      I could not find all the historic data on Yahoo. Only the last two years. Should have worked harder but didn’t. I ran the numbers. If betting at this point, I would take a long position and then use options to spice things up. Given that FTSE is kind of flat, I imagine most money is made by trading options.

      Anyway, just my two cents.

      • mcgcapital says:

        I wouldn’t say it was flat, it’s down 6% in 6 weeks. The daily RSI is oversold but so far it’s not showing any inclination to bounce, all week it’s flatlined around 7300. I just take each day as it comes and try and call for daily ranges and inflection points. Last few days we’ve just ranged 7280-7320 so it’s been a case of shorting near the top of that and buying near the bottom, then bank profits and repeat.

        I can’t see the point in swing longs when there’s nothing impulsive showing up on the charts.. will be obvious if it comes. Until then, buy and hold is just bottom picking. No need to ever touch an option when you can spreadbet/CFD trade on it with a much tighter spread and manage risk easily with stop losses

      • micky says:

        We got the bounce last Friday and continued a bit on Monday,then dropped to the same 2nd support line and then bounced in abc fashion to resistance. It behaves quite well between support and resistance for some very nice scalps .Now consolidating which could be a b wave, with c up to follow.Will have to see which way it breaks.

        • Anne Day says:

          The numbers I got tell me that the calmness right now is sort of like that at the end of March. Not yet have a horse in this race, though.

  9. gary61b says:

    I am starting to get withdrawals, where is the dual personality blogger…..Its like hitting your head against the wall…It feels so good when you quit !
    Its Friday, have a good weekend all and best to you Tony and thanks for all you do.
    Spx close 2905.

  10. phil1247 says:

    schizo

    NDX 7543 ext long failed
    yes i am short

  11. phil1247 says:

    CL ….

    sorry guys
    .. forgot to warn that series down breaking would give squeeze to near 70
    picture perfect
    was going to show that the boys failed to squeeze bonds …
    so they are going to try it again on cl

    they are one for two

  12. gary61b says:

    Guys previous page my chart distinctively shows a Big Black 3 that needs to hit then next week I will draw a Big Black 4 which will be near this level now. trying to help out.

  13. Jack kendo says:

    just before noon, ending diagonal completed, harmonic pattern completed.
    5 mins later, the ed broke down as the news of Trump wants to move forward with tariffs with $200 billion in Chinese goods.
    too good to be coincidence, all manipulation, chart technical and news together.
    plunges today and next week has started.

    inflection signal holds true since the beginning of September.
    the same inflection signal occurred prior to 1987 crash.
    this time the inflection signal is even stronger, and has lasted longer.

    cheers!

    • fxaprendiz says:

      I don’t know, Jack… The VIX etf I follow has barely moved. And yes, there’s is now a valid harmonic pattern in the 4hr charts with the 2911 touch, but it may morph into another pattern should the SPX bounce one last time and touch 2923-4.
      Still on the sidelines, I guess this will be resolved Mon-Tue.

      • travis01 says:

        agree…I watch vix a great deal and it is not responding

      • Jack kendo says:

        fxaprendiz, I think 4 hr chart is not good enough for the time symmetric.
        I use 15m chart, I knew the pattern will have enough time to conclude by noon today.
        The devil is in the details.
        as for VIX, it finished the right shoulder of ihs. straight up next week with market melt down.

        cheers!

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