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Monday, May 4, 2009

Elliott Wave Update ~ 4 May



Primary Count: SPX is tracing out a Minute wave [iii] up on a Minor Wave C
Alternate Count: SPX is topping out on a Minute [d] wave expanding triangle that consists of a double zig zag for the entire [d] wave. A big move down to an unknown [e] would be next. I showed this count on a post last Thursday:
The alternate count would be an unusual one and would account for any retrace below 866 if it were to suddenly happen . I do not favor a move at the moment below 866 which means this expanding triangle idea of mine is likely wrong. But its a valid count at the moment nontheless. Another series of wave moves up would invalidate this idea for good.
I think TA has definately some bearish elements to it for the moment. But it hasn't stopped the price gains. I think the attraction to the 200DMA is just like a magnet. A breakout of the upper trendline I show on my 2 charts would require some volume likely. And if that comes back into the market, it will be bullish and overrun any short term bearish technical indicators.
If April was indeed one big running triangle "correction", then the breakout C wave must play out to peak price. And that peak price resides somewhere higher.
I do expect a correction back to the previous wave iv apex which is around 896 SPX. It might retrace a tad lower perhaps to test 888 again as support but there is not a requirement for that.

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