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Friday, June 25, 2010

Elliott Wave Update ~ 25 June

Things generally behaved as expected for a Minuette (ii) expanded flat count I presented last night.  And not much has changed from the intraday posts or reasoning.

The problem is the rally stalled just when you looked for the "fifth" wave up from today's low. It never materialized.  So we have mixed results.

So stepping back, we can see the market has retraced back down well over 61.8% from the 1131 top which is deep. (Even if the market rallied relentlessly using the alternate [b] of 2 count in some massive bullish [c] move up, [c] = [a] at 1156.)  So you can see how the alternate bullish count that Minor 2 has not topped is not inspiring at this stage.

The best count would be a more bearish one in that any potential bullish up move Monday is just the positive divergences finishing out in a Minuette (ii) price peak expanded flat move. Then the heart of a (iii) of [i] of 3 down occurs. We have an open gap lower under 1060 and we "expect" Minute [i] to finish lower than 1042.

Bottom line: If this is Minor 3 of (1) of P[3], this is no time in getting cute on subwave retraces.

Indeed, again, if this is Minor 3 of Intermediate (1) down, and we expect (1) to finish either near or lower than the 666 low, then we have a lot of price to cover. So from that perspective, things can certainly "flash crash" a bit here and there to get to the required price move lows.  

Again, Monday is a key cog in this wheel for the near term.
But overall, we might see a bullish move Monday, at least the beginning,  just based on the e-mini channel line backtest seems successful so far. Note the double hammers testing this upper channel line on this 15 Minute chart.

Confused? Yeah me too. I'm leaning bullish open Monday with a potential nasty reversal down....or not... That about sums it up. But to be fair,...the bigger picture?  700 SPX or bust baby by January 2011.
I'll have more charts tonight or on the weekend to try and tie the whole picture together.

The big wild card is perhaps the dollar for the near term. Its the thing that keeps me pondering the short term squiggles.
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