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Friday, October 5, 2012

Elliott Wave Update ~ 6 October 2012

The leading diagonal did not pan out.  Yet prices are still overlapping in a non-impulsive action since the late September pullback low. The DJIA made a new high today and new closing weekly high. The SPX and NASDAQ did not confirm.

Lets take a look again at the DJIA. We can label it a double zigzag since the 2009 low.  Momentum is waning on a weekly basis.  We have triple negative divergence for instance on the RSI. Volume is again receding.
So the best count is that Minor 5 of Intermediate wave (C) of Primary [Y] is playing out.

It may not be finished. For now the waves overlap and are arguably wedging on small scale (and large over the last 2 years).
We haven't forgotten the big wedge. Yes prices rose again over the wedgeline but since it was over 2 years in the making, it could be acceptable. After all, all that momentum takes time to dissipate. The 1474 September high is still intact on the S&P500.

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