Custom Search

Tuesday, January 19, 2010

Elliott Wave Update ~ 19 January [Update:6:00PM EST]

[Update 6 PM: I like the Wilshire because it always seems to makes nice waves. "true" waves because its 5000 stocks.  The Wilshire (and NASDAQ) has yet to make a new high since it peaked last week.  One can assume that it had its wave [iv] low and that it will make a new high soon. However check out the second chart....

The Wilshire squiggle count still shows that it might be in a massive Minute [ii] flat and that it won't confirm a new high.  One nice thing about the Wilshire is the "absolute" prices.  With firm lower lows and higher highs there is less ambiguity in interpretative counts.   So in that regard we have a key pivot at Friday's price low. A break of that is very very bearish.  And we have a high in place so any new "squeaker" high could be "it"

So things are not as rosy for the bulls under the surface.  If this is a Minute [ii] flat, a reversal is in short order.  If it squeaks to a new high, a reversal or retrace is imminent as it may likely be a wave [v] top. So no matter how you slice things, you have to be looking for the exit button if your a bull. It could of course take several days to fully trace out a Minute [v] so we await the evidence for tomorrow which will help reveal the market's hand.]

[Update 5:PM:  And here is the squiggle count on the DJIA.  I reconfigured the Ending Diagonal.  It follows the rules still.  If wave [v] takes on an "ABC" look about it, then that would be good.]

[Update 4:40PM EST: The DJIA still could count as an ending diagonal. The waves overlap so for now its still the best count]

Today's up move is not surprising.   As I showed Friday on the RUT, it may have been tracing a Minute [iv] triangle.  Today that followed through to the upside.   This is important as it lets us know that Minute [iv] is finally over and that its a triangle.  So the market is likely in Minute [v] higher.  So we have a key marker on one of the indexes.

The SPX probably traced a Minute [iv] flat of some kind.

Here is one of Apple. The other week I speculated that is needed one more wave up and today it finally broke upward toward that new high. Not quite there yet though.

Hey how about that piece of crap Bidu falling like it did?

Overall the market had no choice but to rally hard. Its too close to the rising bear trendline.  As I suggested, it will only break the rising trendline when most people are looking for higher prices. Today definitely got people to look toward higher prices for tomorrow.

The bullish extremes no doubt strengthened even more by today's results.  Don't be surprised if the market reverses for a 300 point DOW loss sometime this week. It had a nice reversal up day, now it needs follow though.

Bears were skewered today.  More capitulations. This is no doubt. I'll have some more charts later.
blog comments powered by Disqus