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Monday, May 4, 2009

4 May Intraday Squiggle Chart

The point of this chart is that a sub wave correction is due. If pink (i) topped at 907 or will shortly top tomorrow slightly higher, than a pink (ii) pullback should go back to the previous subwave 4 which I think is obvious at 892-893ish. Thats also the 38% correction unless its goes a bit higher first thing tomorrow.

In all reality, it makes sense that key hard won support levels hold for now. 888 would be one of them.

Any retrace back to 866 is downright bearish for the entire rally. So if the market shows early weakness tomorrow, a pullback pink (ii) is likely tracing out. Pick a Fib. 38-50% would be normal.


  1. thanks so much for this. is it really a rule that you can't breach more than a 50% retracement or is it just rare? I understand that this is a [green] 3rd wave but it is still a 1st wave in (pink) and 1st waves are known for larger retracements.

  2. No th rule is you cannot retrace back under where you started which is 866.

  3. oh sorry, I knew that, I was looking at 886 not 866.

  4. Thanks, great chart for planning tomorrow's trades. Your brain must be in hyper drive.
    Levon Helm from The Band liked to say that someone that hot could sh*t fire !

  5. hey daneric..... I've been thinking about an old old chart of yours where you count the cycles on the rsi... if you did that with this never ending rally, how many cycles do you get? and how many should you? 21? or was it 19? I can't remember.....

    hope you know what I'm talking about.....

  6. Blessings unto thy spirit

    I have two questions:
    Gaps, have you lost interest in covering the gaps?
    Ending diagonal, Rising Wedge; do you see a large Ending Diagonal that has formed starting with the March SPX Low (marking the Bottom) and today 907 high is sitting atop of the Wedge?

    Thank you.

  7. Gaps will all be covered in either a pullback after wave C is over or a P3 wave down.

    It gets to the point where wave rules and guidelines do not allow you to cover gaps.

  8. Dan, any target on P3, Kenny has gotten much cooler on the idea of a major P3.