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Monday, June 21, 2010

Elliott Wave Update ~ 21 June [Update 6:37PM]

[Update 6:37PM: Well how about we check our other indicators and charts to help align us with the overall Minor 2 up count?  After looking over the charts, one can suppose that today was the top of Minute [a] of 2. and not 2 itself. At the least, the charts have met minimum target areas, but would look better if they all hit deeper. Here they are:

[Update: the TED spread also fell today.]

The dollar: This is a key chart. Wave "A" of (2) likely bottomed as I shown earlier on my post today

Again, B wave strength in the dollar could translate into further Minute [b] of 2 weakness in equities. I thought it might decouple a bit today but alas, it didn't really too much in the end. Green dollar, red markets.
Advancers chart really didn't take a hit much at all. It would still look better for a bit of a further down and then the [c] to peak.
I somehow missed the big gap up on the VIX chart, and now I suppose the market wishes to challenge that to  close it before Minor 2 is over. But before it is challenged, we could get some fear again in a VIX move up.
CPC moved into my target box but it could bounce around here and move lower eventually.
BPSPX has solidly retraced yet it hasn't yet been a 38% retrace. So again, even though today strengthened on this chart, ultimately more upside would look ideal.
So all in all, each indicator has reached expected minimums just as the market has reached expected 50% minimum. Yet, ideally each of these charts would look better if they moved a bit more. So that supports today as an SPX [a] wave peak of Minor 2.

[Original post]
The reversal nature of today's move could indicate Minor wave 2 is over. It did after all manage to obtain a solid 50%+ retrace on the SPX and Wilshire and actually higher on the DJIA.  Anything extra from here on out is bonus.

However, we don't yet have a solid 5 wave pattern down and have not yet closed under 1089 to confirm a more bearish reversal.   So rather then chart the squiggles, lets suppose that the 1131 peak was the top of Minute [a].

Another possible count is (i) of [c] of 2. But in this case, it will have to reverse hard up tomorrow and 1105 cannot be breached even on an intra-day basis.

A close under 1089 gap would be bad for any bullish count up. So one could suppose that if this is Minute [b] pullback, then 1089 gap should not be closed under as that would be a bearish reversal of the follow-through day.

The hourly chart's technicals support more of a down move ultimately from here. We have significant negative divergence at today's high and a solid reversal that could translate into further technical weakness on this chart as a minimum.
As far as the daily is concerned, we don't yet have an "[a][b][c]" move that shows up well on the daily chart. It doesn't have to of course , but something to consider.
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