Wednesday update

SHORT TERM: gap up opening then pullback, DOW +54

The first three days of this week display Asian markets with an 0.8% loss, and European markets with a 0.1% gain. US markets started the week at SPX 2914. After a gap up opening Monday and rally to SPX 2937, the market dropped to 2918 by the end of the day. Tuesday traded in between those two levels. Then today, another gap up opening with a rally to SPX 2940, before pulling back in the afternoon. This certainly sounds positive.

Three of the four major indices, however, are all in different wave counts. The NDX/NAZ are in downtrends, along with the R2K and recently the TRAN. While the SPX/DOW are still in uptrends, and the DOW has been making new all-time highs the last two days. Quite a mix. Almost as bad as the divergence between the US and the rest of the world.

We updated the DOW charts to display a Minor wave 3 that is still underway. The SPX chart has been updated to suggest its Minor 3 may not have ended yet. The NDX/NAZ charts remain the same. If either can confirm an uptrend, this would suggest an extending Intermediate wave v. Short term support is at the 2884 and 2858 pivots with resistance at the 2929 and 2995 pivots. Short term momentum ended the day nearly oversold. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: uptrend


About tony caldaro

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240 Responses to Wednesday update

  1. fionamargaret says:
    Thanks Colin Twiggs
    Thanks Tom McClellan

    Thanks and love to Tony…..and everyone xx

  2. Watching the talking heads a few mnutes ago.
    TA type guy Carter Worth says the anticipated bounce will come at the previous breakout level.
    Which is … 2800 SPX.

    Just saying, because it;s likely a lot of people are in at higher levels, and hoping for a more aggressive bounce.
    But, as always, “Hope is not a strategy”.
    Plan accordingly,


  3. jobjas says:

    SPX update – completes A of minor 4
    charting tip (for those who use EW & want to learn from others) -When the market is moving fast move to a smaller time frame to identify waves and sub waves and pinpoint exact turn points.

  4. phil1247 says:


    weekly bearish engulfing reversal on SPX
    daily close below 34 day ema

    if 4 is going to turn blue
    we need to stop digging this hole
    n’est ce pas ?

  5. Tony C: Your pivots are magical….I know you had 2 which both hit…have you ever looked at a return move ABOVE the 1st level rebound after the 2nd was reached? Seems to confirm a buy if that happens…….cheers.

  6. Jack kendo says:

    Tony Thanks, Excellent work.
    we had 5 waves down from 2940.
    is this the count you have for Minor 4?
    2868 is right at the channel support.


  7. fxaprendiz says:

    This is my current bullish view for the rest of 2018 and the first half of 2019.

    For this bullish count to pan out, current wave 4 should end somewhere between the blue and yellow areas. Touch/break the red rectangle and then my view leans bearish again.

    It is interesting how even now that I have switched to bullish, still there are key differences with Tony’s and Avi Gilburt’s counts. Some similarities though, one is that all 3 of us expect a wave 5 to finish next year, Avi expects it to go +3200, myself to around under 3090, Tony to +3000. However what comes after that is completely different in our 3 views, and that has to do with the degree at which each one is working on. Avi is working at Primary degree for that high, and expects a drop of 20-30%, Tony is working at his Major degree, one degree below Primary, and expects a drop of 15-20%, whereas my count is at 2 degrees below Primary and therefore expect a relatively shallow correction, of about 8%.
    Will post all 3 counts updated when time permits.

    • Jack kendo says:

      fxa, nice work.
      in the morning, you said:
      “Still looking at a touch of the 2872-69 area today”
      that 2869 was perfect, how did you see the number?

      Tony updated Minor 4 at today’s 2869.


      • stcoleridge says:

        He did, but with a tentative light green.

      • fxaprendiz says:

        Thanks Jack. 2869 was the 1.128 Fibonacci retracement of the last impulsive up leg, from 2877 to 2942. Under the right conditions it works like a charm, I think it has to do with the fact that most traders are still unaware of that Fib ratio. Unfortunately the more people are aware of something in trading, it seems the less effective it gets with time, so better to keep it low key 🙂

  8. fxaprendiz says:

    This is the harmonic pattern that prompted me to hedge my shorts and reverse to long for now:

    I think wave A of the wave 4 is done now, and we’ll be bouncing up and down between 2870 and 2915ish the whole of next week in a wave B, with potential for an overshot to the 2915-25 area, but won’t make new higher highs until this wave 4 is all done.

  9. stan911 says:

    Looking market to get pumped Dow 25950-900 spx 2827

  10. micky says:

    bounce at 70 ish?

  11. phil1247 says:

    here is what cash looks like to me

    ready to ring the cash register now

    see ya next week!

  12. Lee x says:

    Nice job Tony

  13. fxaprendiz says:

    Real quick… I just hedged my 2917 short at 2873 and additionally I opened a small long at the same level. Reason: there’s a bullish pattern in the 1hr and 4hr charts, a harmonic bullish BAT. No time to draw it and post it, maybe later. Good luck guys

  14. Page says:

    SPX is extremely oversold but do not expect any bounce today, the earliest SPX will bounce is next week late Monday or Tuesday. I am still expecting SPX around 2780.

  15. travis01 says:

    This has been my best trading week in a long time. Great setups and pivots. Best to everyone on either side of the trade (or political stance). Off to take the wife for a weekend with friends and see my Clemson boys play.

  16. torehund says:

    Battle of the downturn, two etfs tells a story of lacking China assistance….Sea (shipping) and Ura (uranium). Both dwindling for ages, but a change is getting closer.

  17. alexh110 says:

    Added a small long on SPX.
    Still holding short also, but intend to close that trade later today.
    Noticed City Index have netted off the margin between the two trades, which surprised me because I thought netting off had been abolished by ESMA?
    Perhaps it depends which broker you’re with?

  18. mcgcapital says:

    FTSE buy set up off 7300.. would target 7340ish as long as holds 7290. Would like to see a bit more back and forth around 7300-10 to set it up

  19. phil1247 says:

    es 2874 target coming up gary if you are still on the job 🙂

  20. Jack kendo says:

    Tony thanks
    oew updated dark blue Minor 3.
    but my guess is Minor 3 completed at Oct 3’s 2940 with SPY 0.01 truncation.
    yesterday’s 2884 can not be Minor 4. Minor 4 does not complete in one day.
    slightly below 2884 for +div, should rise one more time whipsaw between 2883 ~ 2910.
    sell this morning high, buy this 2883+-, and sell again next Monday at 2905~2910.
    DOW and NDX already lower than yesterday’s low.


  21. elmer510 says:

    Thanks to Tony who has done a remarkable job the last months. Not many would dare to suggest new ATHs when trade war with China was headline in the news every day, some few monts ago.

    Now I wonder if it’s reasonable to put money on Minor V to come, or if it’s a risk we won’t see a minor V. Clouds are gathering at the stocmarket-sky, especially in Asia. Bond- Yield is rising in America. Feeling is headwinds are building up. Will there despite of this, be a final wave upwards, again?

  22. lml25 says:

    Looks like the Hindenburg Omen made a comeback.A minimum 3% correction is most likely–down to 2852.GDX is iffy at best.GL all.

  23. Bud Fox says:

    SP500 double top is in, and guess what happen’s next?
    Market going down, right. Right now, looking for a low
    at 2800 to form, then just have to wait to see how the bounce off
    that low takes us higher. I am Bearish…, not Bullish. Key point,
    if you read my work in recent weeks. There are no plans, to make
    comments on the OEW board as regular practice. Thank you TC.

  24. lunker1 says:

    SPX pop since yesterday’s low has set up potential +D with a lower low.

  25. fionamargaret says:

    TBT to 51……sort the long bond
    UWT to 57….let’s see what if it can get up there….

    • fionamargaret says:

      sorry…yes, the words don’t make sense as written…and English is my mother tongue…fighting with my computer…maybe some irregular chip in it…xxx

      TBT to 51 …..short the long bond, making rates higher, bond prices lower…
      UWT to 57…oil to $83….let’s see what it can do….

      • Jack kendo says:

        the best performer is tvix for two days in a row. you lost interest and don’t play anymore?
        next week should enter phase 4, the best, expecting 200% ~ 300% gain in a few days.


      • Bud Fox says:

        Go ahead, Buy a new machine, you’ll thank me for the suggestion…

        • fionamargaret says:

          Thanks are always coming your way regardless Bud.
          Now Bud if we don’t mean to attend the latest in the sagas of royal weddings by bus, we had better do well…..xx

  26. gary61b says:

    ES, today marks the 11th day for minor 4, minor 2 was 12 days. Minor 4 so far 59.25, minor 2 was 103. Where is Tommy the fat finger, it could be over today and by Monday, no one would remember that we just had a correction.

  27. emuntrader says:

    Yesterday’s down move did look impulsive, but I do not believe it sold off far enough to the downside to be considered the completion of wave 4. Looking for a shorter wave 3 around to end around the 2869 area (.618 ratio of “wave i”). Then a small pull back and a final wave down to low 1960’s.

    Best of luck

  28. fxaprendiz says:

    SPX update: my 2917 short position still open and in good shape. The half-position hedge opened at 2884 closed at a 20 points profit at 2904 a few minutes after the NFP release.
    Still looking at a touch of the 2872-69 area today or early next week, then a reaction bounce then a second leg down to under 2864.
    After having said that, I’ll mention again that I recently switched my medium and long term view to bullish, therefore I’m treating this downward move now as a pullback within an ongoing uptrend. If so, 2800 shouldn’t be ever breached.
    Will maybe post a chart later with my bullish count for 2019.

    • mcgcapital says:

      If it goes under 2864 that would be the first time since April we’ve had lower lows. Still think it’s been coming and the rally up has been extremely odd in terms of its structure and at a time when everything else looks in bear market mode. Let’s see what happens if that happens. In terms of today’s action, looks like early strength which will be followed by later selling, just like some other days this week. Yesterday we gapped down and then rallied into close.. seems like it always fades one way or the other during these corrective moves, can’t remember the last time it opened lower, went lower and closed on the lows

      • fxaprendiz says:

        I totally agree that the rally up from the 25xx lows was really odd, hence my reluctance to treat it as an impulsive wave 5. It took me a while to come around and start working from the view of an impulse. My current main count for next 8-9 months, I just posted it in this thread. If SPX goes under 2864 I expect it to end somewhere between 2845-15, if it goes lower then that then I’ll start to lean bearish again.

  29. phil1247 says:

    BONDS spike to new lows !

    rogues should exit almost all short bond positions now

    keep a few lotto tickets just in case

    Tore .
    .. i know i know ,,,,,,,,,
    its just the beginning
    profit targets hit …. gotta do it

    • torehund says:

      I always attempt to find the monumental turns, for that surf forever slam dunk. But I have yet to experience it..Its living the dream or waiting for that sunset that never came. Thats me, up like a Lion and down like piece of nothing. Devoid of hope life is nothing, I have learned to love the threnches, thats my home….Never loose the stoke😝🤖😝

  30. gary61b says:

    ES, looks as though the 38 special was possibly c1, c2 2915.5 retrace and then possibly c3 to finish near 2965 level. My best guess at the moment. you gotta love it.

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