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Monday, March 7, 2011

Elliott Wave Update ~ 7 March 2011 [Update 9:28PM]

[Update 9:28PM: MUB
[Update 9:06PM:...Though I can respect e-minis triangle price action....on the other hand, IYR wedge and post-wedge moves are still intact. A nice downdraft on IYR would fit the bill here.
[Update 6:35PM:  I have to respect this triangle for now.  Here is an example of a similar-looking ascending triangle back at the end of 2008. It happened to be the [c] wave of  Minor 4.

1352 SPX and 14350 Wilshire5000 is the Fibonacci targets of (C) = .618 (A). Although we have come close, if the market breaks higher, those price points would be a powerful target to be met and then sold.  It would only require a nominal new high to reach this key Fib target.
[Update 6:02PM: CRB. (C) = (A) in log scale channeling
[Update 5:45PM: Here is another look at the top bearish count. I corrected my SPX chart at the bottom to reflect this Wilshire. A wave three down (presumably tomorrow) would not be the "third of a third" as some have supposed, but merely a portion of a subwave one of three.

Why are my wave degree labels so small? Because I would expect that DJIA 1000 is a long way down if this is Primary wave [3]. But the degrees are not so important at this juncture. We can tweak them later if need be.

A strong guideline of the first subwave one of a wave three of any degree is to advance prices (in this case lower).  And yeah, the triangle doesn't work very well on the Wilshire.
A triangle has traced out on the e-minis. There is still a valid triangle on the SPX and DJIA.

The bear count supposes a series of ones and twos down and its a bit of a stretch. But it is a possible setup for a hard down to occur tomorrow so I have it listed on the chart. But again, the count is certainly less than ideal. If futures are up big in the morning then I suppose you can quickly junk that count.

If there is to be a wave three down, then it needs to happen tomorrow. We had a good reversal today but we need follow through tomorrow.

The bull count is the obvious triangle. And yes further sideways is an option too - if we do head further sideways for a number of days/week(s) that greatly strengthens the Minor 4 wave count.

Who cannot see that triangle price action?  And will that render it a failure?
The triangle is more sneaky on the cash index, but its still valid nonetheless.

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