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Monday, August 16, 2010

Elliott Wave Update ~ 16 August [Update 8:15PM]

[Update 8:15PM: This one chart alone makes me wonder if there is a pretty decent upside corrective coming at the least because the best count on the NYAD would have us go into one more accumulative high. This really needs to breakdown in a hard way for bears. Yet so far it hasn't.

Objectively it needs a new high to fulfill a wave count and would then produce a double negative divergence with market prices. And looking at the last movement, it took about 27 SPX points to produce an equivalent move.  So using back-of-the-napkin math and intuition, if the SPX retraces 62% back toward the 1129 peak, it might only take 1105-1107 to perhaps trigger new highs on this NYAD. 1106.5 is the 62% retrace spot. 

So this chart alone suggests 1105-1107 on the SPX.  If they can close the 1090 gap, a squeeze to 1105 area seems doable.

Just a wild guess at the moment, this is one of those "will-it-work-and-pan-out?"-type charts. Well this is an EW blog and I like counting stuff....
A view showing the proposed entire Primary wave [5].
[Update 4:55PM: A bit of a hammer candle on the daily.
The dollar looks like its in wave [ii] mode.  I suppose Minor 1 of Intermediate (3) of P[3] in the dollar should try and finish the dollar higher in prices than (1). Therefore Minute [i] up seems an appropriate label for the dollar for now.
Notice in the gold chart I keep showing is that I did not have it labeled as I am less certain about gold at the moment.  It did hit my minimum retrace target band as I suspected it would. If its working on a wave 2 expanded flat peak, then I suspect a reversal should happen soon and might surprise a lot of people. After all it would be a Minor 3 down next or [iii] or even C]

Primary count is that wave (i) of [i] of Minor 3 finished at today's low. Working on wave (ii) is probably the best option.

SPX has that gap above at the 1090 area and an inverted H&S would project a high enough target to close it.  Some pretty decent positive divergences spanning the indicators and MACD on the hourly supports the count of a wave (ii).
Wishire shows the potential best squiggle count.  Working on an inverted H&S which would carry it past the 38.2% retrace (preferable if it does) for a wave (ii)
TBT is certainly like a falling knife.  It has an interesting chart in that today's candle gapped and traded under the lower BB on higher volume.  Will be interesting to see what kind of candle is produced tomorrow.

One interesting possibility would be a downside Tasuki gap to get it back in the BB for a day.   And then the knife continues to fall?

I still feel bonds are blowing their final bubble regardless. Its getting a bit surreal.  The last bond high came after a major panic decline (3) of P[1]. This bond high is coming right after a major rally P[2]

No signs yet of any kind of turn though. The piling into debt keeps coming at a record pace. Seems a fitting way to end a debt bubble perhaps....blowoff just like commodities in 2008.

Time will tell, there are lots of opinions on this. I'm just taking the least traveled projected route:  A rising rate deflationary collapse.

So due diligence is required.
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