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Tuesday, October 26, 2010

Elliott Wave Update ~ 26 October [Update 8:33PM]

[Update 8:33PM: Again an interesting interaction with my blue Super-cycle upper channel line http://3.bp.blogspot.com/_TwUS3GyHKsQ/TMZGINSjohI/AAAAAAAAH64/Q0ANV126N4E/s1600/2010-10-25-PROPHET.png. Note that so far this year 2010 there have been thee separate average of 1000 point  or more DOW sell-offs that originated from this line including the May 6th Flash Crash.

I am convinced that market feels this line and I think I have it in the right spot. I haven't moved it since I laid it down at January high. ]
[Update 7:55PM: When AMZN (and other stocks in a parabolic rises - i.e.-NFLX) rolls over, maybe the market will.  But AMZN is probably tracing some of the clearest waves as of late so why not see where it leads?

Note That Minor 5 = 1 at $176.
The second chart shows that within Minor 5, its shaping up to be Minute [v] = [i] at about....$176 roughly if things pan out.

So that is some good Fib confluence and a nice target ($175). There is no reason to expect Minor 5 to extend as Minor 3 of Intermediate (5) extended a near perfect Fibonacci 1.58 (just shy of 1.61)

Sorry for the late post, didn't have time today to look at much. But one thing is apparent: the market has a destination in mind and seems determined to get there.

The squiggles are some of the ugliest I have tried to count lately which could be good for bears.  Beautiful impulsing is a sight to behold. A struggling market produces ugly....

Ugly waves also tend to find themselves within triangles too....

With the continuance of both zigzags up and down the last few days, I would have to say the market is dealing with serious resistance. Namely the April DOW highs and the 200 week SPX moving average at 1195.
http://www.marketwatch.com/story/powerful-uptrend-meets-major-resistance-2010-10-26

Rather than try to nail down a squiggle count, stepping back the market may be triangulating in order to consolidate up at high support so it can attempt a breakout of 1195 and the big SPX gap at 1197-1202.  This is where the resistance is.

However, if the market "stabs" upward again to a new high tomorrow, it could smack of an exhaustive ending diagonal wave move. So the jury is out.
So far the market is best counted as 3 big waves from the July lows. If we correct a bit deeper here (say perhaps to 1150 SPX) but maintain above the August highs of 1129 SPX, it could be a Minor wave 4 and then a Minor 5 will come and take out the April highs. That is the best "bigger picture" alternate I can come up with.
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