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Thursday, July 28, 2011

Elliott Wave Update ~ 28 July 2011

Wave iv bounce today as expected http://4.bp.blogspot.com/-3vCzuoCwW4A/TjC2mjNR8BI/AAAAAAAAJlk/ZLhahc2_Cz4/s1600/wilshire1.png. Then a downturn in what could be a wave v of (c) of [e].

Triangle Minor 4 count is still the primary count and we are now coming into the ideal [e] wave target window. You can see on the Wilshire5000, it has made a lower low than 18 July low.   SPX is diverging at the moment. SPX target is 1286-1287 SPX for an ideal [e] wave.

SPX:
Wilshire 5000:

IF THE MARKET HAS 'TOPPED' AT 1370, AND IF THIS IS A THIRD WAVE OF SOME DEGREE, THEN THINGS ARE ABOUT TO GET UGLY SOON.
Lowest an [e] wave can go is 1259 SPX. Then it would violate the [c] wave.   If 1258 support were to break on storming downside breadth, than a triangle Minor 4 count is not whats happening but more likely a wave [iii] of Minor 1 down.

NYAD down breadth is starting to take a bearish hit.  At the least one can say it no longer is acting in a bullish manner with elevated levels versus prices.

BOTTOM LINE
The market may soon tip its hand one way or the other. I am not in love with the Minor 4 triangle count, however it is the best EW interpretation I feel at this moment.  I still can see one more "thrust" up in an attempt to squeeze its way to 1370.

I can also see the opposite happening as the rot underneath the system eats away ever more at the foundation of bull.
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