Custom Search

Tuesday, January 26, 2010

Elliott Wave Update ~ 26 January [Update 7:50PM]

[Update 7:50PM: JUNK makes a very nice impulse pattern down.]

[Update 7PM: Not sure if the market has any down moves left in it for now or not and if it does, I suspect it won't be a long-winded one. The McClellan's is showing a smidgen of positive divergence and a small move today should mean a big move in the indicator is on tap. Combined with a potential VIX buy signal (market bullish) and a completed impulse Minute [i] count, there is a good chance the market moves from 1092 on close toward that 1115-1122 area tomorrow and/or Thursday. A 22 point SPX move to 1114 is a 2% market move which is pretty good.  A move toward 1122 is obviously above 2.5%.

The 50 DMA resides at 1114.45. The first order of business for bulls to repair technical damage is to close above the 50DMA. At least a backtest should be in the cards.  The second goal would be to close above the 50% market retrace at 1121.

I think I pointed out in the past that Minute [iii]'s tend to launch from just above the zero line on the McClellan's.

[Update 5:20PM: Apple at the top, record earnings, new product coming out tomorrow blah blah blah.  Things can get no better which is why the stock is likely to crash back to earth.

The chart paints a bleak picture, and combined with EW theory, I have a near side target on a break of the trendline of  $170.

I still think it should land in the target box

The RUT has now what can be called 13 waves down which qualifies as an impulse pattern.  The SPX and DJIA were just not ready to break over resistance today.

I think the best way to view the entire sideways motion of the past few days as a Minuette (iv) that alternates from theMinuette (ii) in corrective form.  We could still easily get a much lower low in the 1080's tomorrow to hit that trendline.  Or today's late low could be a (b) as I have marked. Keep an eye on the alts.

Still looking for a Minute [i] low for now as positive divergence is showing on the hourly chart and the VIX "trigger" is now set as it closed back inside its daily BB.  But we'll see.

blog comments powered by Disqus