Wednesday update

SHORT TERM: gap down opening then rebound, DOW +19

For the first three days of this holiday shortened week the Asian markets lost 0.9%, and the European markets gained 0.5%. The US market after doing two zigzags up from the SPX 2347 downtrend low, may have started the third zigzag at today’s SPX 2467 low. The previous zigzags were: [2367] 2414-2394-2468 and [2398] 2508-2473-2520. This third one could be: [2467] 2519-2495-xxxx. Had the first leg up of this potential zigzag exceeded SPX 2520 we would feel better that another one is underway.

A market maker in the making. Bernanke, Powell and Yellen get together on Friday morning for a round table discussion. Will Powell announce a QT freeze? Short term support remains at the 2479 and 2456 pivots, with resistance at the 2525 and 2575 pivots. Short term momentum ended the day around neutral. Best to your trading and Happy New Year!

MEDIUM TERM: downtrend

LONG TERM: downtrend probable


About tony caldaro

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396 Responses to Wednesday update

  1. If external noise doesn’t matter than AAPL is just a small nuisance. ZIGZAG would place the next move around 2575. EW predetermined path or allow the market to go where ever it likes and THEN redraw the map to fit reality. Since EW has infinite ways of interpretation it ALWAYS ends up being correct. Question: How can you play options or short term bets if Up becomes Down and it still validates EW.


  2. xEVAx says:

    NDX is testing it’s 200 here on the 10 minute chart on the futures….

    DOW can drop back to it’s 50 on the 60 minute….


  3. Good evening all. Apple’s disappointing guidance, really spooked the markets. I was reading an article on some currency market dislocations associated with Apples announcement. Don’t fully understand that intermarket relationship, perhaps others can chime in and add some color on that one.

    Tonight, /ES broke the 61.8% long @2478. There could be some type of a minor counter trend rally in the overnight session that will fail and lead /ES to the 50% long at 2460. Or, when Asia/Europe open, they may want to sell first and ask questions second…in that case, /ES testing 2460 tomorrow morning, is a real possibility.

    The decline continues as I write this post but in a snapshot in time, as in a ballpark level to watch, should /ES trade above the white dotted line,a pivot (not associated with Tony C.) that would invalidate this analysis.


    • tradingbot99 says:

      Concerning the market dislocation one possibility is the unwinding of the yen carry trade. A popular trade has investors borrowing cheap Yen and buying a safe asset in USD (ex.: AAPL shares). When AAPL tanked during after-hours these investors may have had to quickly unwind the trade (sell AAPL stock in USD and buy Yen). Due to low liquidity this may have flash crashed the currency pair.


  4. Thanks, Tony….I appreciate your pivots and based on today’s spike down and reversal…and most importantly the breaking of the steep recent decline (classic charting), I think a run past 2575 looks like a good short term target, I’m expecting 2600 to 2650 before another drop.


  5. Michael Wiseman says:

    Small H&S on the S&P futures points to a potential retest of the overnight low from yesterday near 2450.


  6. gtoptions says:

    Thanks Tony
    SPX ~ 2019 Pivot Swing Plan ~


  7. xEVAx says:

    The low could hold, DOW, NYSE, align with NDX in wave 4, Trader Sal’s count works for me for a C wave .) OR ELSE =) The other possibility is we do a huge wave 5 ED, all ABC’s and a nightmare for bulls and bears alike LOL


  8. OPEC cuts production last month by 530,000 bpd the most since January of 2016.


    • riderbobo says:

      There is a market technician in Canada named Don Vialoux whose focus is on sector seasonality. He has been around for decades.

      He said last week that oil often bottoms the third week of January.


      • One of his Top Picks in May of 2017 was the First Trust Biotech ETF (FBT). Was trading around $106 at the time and rallied to $160 in September of 2018.

        I will be heading over to the JP Morgan Healthcare Conference next week in SF.


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