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Wednesday, August 31, 2011

Elliott Wave Update ~ 31 August 2011

The 15 minute SPX chart looks remarkable.  Wedge for (a) and now - perhaps - the same wedge developing  for (c).

At some point if prices get too high, wave [iv] does not work as a count. Officially that mark is the breach of wave [i] price range of 1256 SPX. But in practice, prices should not get that high.  However something in the mid-1230 range would be acceptable. Hence our count of Minute [iv] is intact.

Time is also a heavy consideration for any normal wave four. And time has now matured and developed nicely for [iv].

But even in the top alternate count of Minor 2 up, it still implies the same: prices will turn back down.
Another look at the daily. Some are insisting the 50 DMA, at the least, will need to be revisited on this rally. I make no presumptions.


Tuesday, August 30, 2011

Elliott Wave Update ~ 30 August 2011

Primary count is still Minute [iv] of Minor 1 of (1) of P[3] down. 1228 is a possible target.
A look at the daily shows that 1220-1227 SPX has been a resistance area twice.  Makes a good Minute [iv] target range although this market always seems to push things to the maximum in either direction. So upper range for Minute[iv] would be the underside pivot at 1235 SPX approximately.


The move sideways with an upward bias over the last few weeks looks counter-trend in the bigger picture.

Monday, August 29, 2011

Elliott Wave Update ~ 29 August 2011 [Update 8:40PM]

[Update 8:40PM: Here is the squiggle count for Minute [iv]. Call it a zigzag or upward 3-3-5 flat. They both imply the same.
Minute [iv] triangle is out of the top count. Market internals today were very robust. The best Minute [iv] count at this moment is a strong upward flat that may squeeze the markets back toward the base channel.

Here is Minute [iv] in terms of base, acceleration, and deceleration channeling technique. The proposed count would be a Minute [iv] upward flat.


Friday, August 26, 2011

Elliott Wave Update ~ 26 August 2011

The back and forth of the last week or more has really taken on the look of a sideways Minute [iv] corrective wave. So we'll go with that. The triangle is certainly a viable pattern.


Thursday, August 25, 2011

Elliott Wave Update ~ 25 August 2011

Our top counts have not changed. The Minute [iv] triangle is probably the most interesting option at the moment.


Wednesday, August 24, 2011

Elliott Wave Update ~ 24 August 2011 [Update 4:54PM]

[Update 4:54PM: Gold's count certainly has enough waves in place to consider it a finished wave pattern.
The 3 top competing counts:
Another look at Minor 2 count with P[2] ending in truncation.


Tuesday, August 23, 2011

Elliott Wave Update ~ 23 August 2011

We'll stick with the Minute [v] of Minor 1 count.  Rebound would be wave (ii) of [v].

The top alternate is a wave [iv] triangle with the (c) wave being the rebound.


Monday, August 22, 2011

Elliott Wave Update ~ 22 August 2011 [Update 5:20PM]

[Update 5:20PM: A closer look at gold from a daily perspective in log scale.
[Update 5PM: Impulsive down on XLF. Leading the way forward as usual.]
[Update 4:52PM: Gold weekly has indeed hit the upper channel line where (1) - (3) and now (5) connect.]

Primary count is that the market is Minute [v] of Minor 1 down. It could also be the market is tracing a wave [iv] triangle.  It'll take a few more squiggles to determine which it is. I'm leaning toward a triangle and the b of (b) of [iv] wave is playing out somehow

Today was a huge opening only to be completely reversed and retraced.  It shows there are interested buyers but sellers still have control. Minor 1 will not be finished until sellers are exhausted.


Friday, August 19, 2011

Elliott Wave Update ~19 August 2011

Going out of town tonight so an early update thread here. Primary count is Minute [v] of Minor 1 down.


A detailed look at proposed wave [C] of the dollar in reference to this chart
Futures really need to work hard to get lower than wave [iii] which was 1077 (approx 1080 SPX?).Continued overnight selling.
And somehow the dollar seems to have worked itself into perhaps a descending triangle.

Thursday, August 18, 2011

Elliott Wave Update ~ 18 August 2011 [Update 8:23PM]

[Update 8:23PM: Gold, Dollar, Bonds. My counts have each forming a long term extreme in each. The key is keeping an eye on sentiment data.

Seems its heading for the upper trend-line as I suggested a few weeks back:
Mainly we are looking for an extreme in sentiment for Gold. This data is a few days old, but we can imagine it is starting to break higher. Charts via Sentiment Trader
Still tracking a narrow target range for the dollar:
Like, GOLD, the key I think is to keep an eye on dollar sentiment. This data is a few days old. Working toward a negative extreme.
30 Year yield still has not confirmed the low end of the yield curve.  I am betting it doesn't confirm. I may be wrong but its still my hunch.  Notice anything about yields?   Bonds are already reaching an extreme and P[3] has barely begun!  My prediction for when "all-the-the-same" market selling will kick in (bonds, commodities and stocks selling off) is in Minor 3 of (1) of [3] and particularly during (3) of [3].   We are still in (1) of [3] and bonds are being piled in to.  If bonds and stocks sell together in later phases of Primary [3] down, the dollar should be the winner.  But for now, its not the case. This was sort of expected at how the start of P[3] would behave.
And once again, we are looking for extremes in bond sentiment.  This is the bond put/call ratio 10 day average updated tonight.  Its hitting extremes.  I expect some fresh sentiment survey data tomorrow.   There has been a rash of 90% Daily sentiment on bonds lately including a recent 98% reading.  Again if everyone is piling into bonds now, what happens in Minor 3 down if stocks and bonds sell and there is no one left to buy?

After all, Bonds are a Ponzi scheme in my opinion. I have tried to stop using that word Ponzi lately as it is overused but it certainly is accurate in my opinion for bonds. You have Primary dealers flipping to each other in a game of hot potato with the FED having an expanded balance sheet bloated with them. There is simply an abundance of paper. The bond market gets it wrong is what I rather would say.  A debt crisis and people are buying debt? Doesn't make sense to me. And sooner, rather than later, the market will agree.
In my estimation, gold, the dollar, and bonds, are heading toward long term extremes such as how stocks seemed to have done so first.  For instance, Gold and the Dollar may reach extremes together and Bonds may hit their extreme at the bottom of Minor 1 of (1).   These are best guesses based on long-term sentiment and wave patterns and keeping in line with Prechter's theory of "all-the-same" market.

On Minor 3 of (1) down is when the dollar should finally be a winner.  Bonds and stocks should sell at key spots of panic together.  Again Minor 3 of (1) of P[3] down would be one likely such area.

The primary count is Minute [v] of Minor 1 of Intermediate (1) of Primary [3] wave down.

Wave fives should be less intense than wave threes.  On both charts below you can see the market internals were less so far then wave [iii]. That fits the wave [v] profile.
Squiggle chart shows five waves down from yesterday's peak. Could be a wave (ii) bounce coming then (iii) of (v) should work the market lower toward the 1100 or lower SPX goal.


The gap down supports both top counts at the moment: 1) Minute [v] to lower lows under 1100 SPX or [b] wave pullback of an [a]-[b]-[c] Minor 2 wave up.

I'm sticking with the Minute [v] count for now as primary because [iv] played out very nicely so far
Whats even more amazing is the II bull/bear ratio is still quite elevated.  This is yesterday's data that came out (via Sentiment Trader)

Wednesday, August 17, 2011

Elliott Wave Update ~ 17 August 2011

The market popped above 1200 SPX as I suspected it might. It made it to 1208 but that would be about an ideal price peak for a Minute [iv].  Any further upside stabs above the 1208 high today doesn't fit well with a continuing Minute [iv] count.
 Exploring the alternate Minor 2 count we likely had an [a] wave peak today in some form or another.

The upward tilt of "threes" over the last few days count well as an expanding ending diagonal which is why I labeled it the way I did.
SPX daily from the Minor 2 perspective and assuming an approx 62% retrace. Timing is a guess it could well take much longer.


Tuesday, August 16, 2011

Elliott Wave Update ~ 16 August 2011 [Update 5:24PM]

[Update 5:24PM: Another look at the Minor 2 count using the S&P daily.

You can see the 1220ish resistance and the 1173 support in the daily. These are 2 key levels in my opinion. A break below 1173 is bearish and may confirm a Minute [v] of Minor 1 down.  A break above 1220 likely confirms Minor 2 wave count.

And for now, prices are stuck in between and may be for a while.

Price action seemed constructive today for the bulls. Intraday, short term overbought conditions worked themselves out a bit yet prices maintained ok.

The Minute [iv] count is still in play but I admit I am losing faith in this count though we have room for a pop up to 1215 SPX or so. I'd prefer to see the market rollover in Minute [v] down, and it may still, yet the market "pause" after the mini-crash probably needs more time to play out.  1-2% price swings are a lot less violent than 4-6%!
We may as well explore the possibility this is Minor 2 wave up.  Specifically looking for the top of Minute [a]. Then pullback in [b] and a strong upside [c] - perhaps timed with Jackson hole.
Despite the 2 competing counts, the near term moves over the next day/week can support either count.  So we may not know until next week what the preferred count is but my gut is leaning toward Minor 2 up.  This thinking is mostly influenced by Sentiment Trader's intermediate-term sentiment data and charts.  Many are extremely oversold still, and if it takes a few weeks to work that out, then that means higher prices which points toward Minor 2.

Either way, I'm long term bearish as usual. Just trying to figure out the best entry points again.