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Thursday, January 12, 2012

Elliott Wave Update ~ 12 January 2012

The premise of a Minor 2 count retrace is that its price should be stopped in the resistance zone of 1295-1307.  That doesn't mean prices won't pop higher than 1307, its just that this zone will not be successfully used for "support" again.   It should fail to re-conquer this zone and use it as a launch for higher prices. That is my firm opinion based on the wave count, technicals and sentiment measures. I am basically saying if this is Minor 2, then the price must stop in this general area.

So far the market keeps making stabs into the zone, even closing higher today.

The best squiggle count is probably something like this below. There are some nice Fibonacci relationships with this count.
The Industrials are starting to under-perform perhaps. That is probably required as they have retraced quite a bit more than the other indexes.

The Wilshire - the total market - shows a very long-term resistance line that is a bit different than the SPX and DJIA.  

I don't know if it can make it that high, but it should prove formidable if it does.

Wilshire hourly shows the long term resistance.

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