Monday, August 31, 2009

So much for Monday...

In my weekend post, I mentioned that today should clear up the ST count. Well, I guess I was wrong. After re-looking at the charts I realized that what I had previously labeled a-b-c or 1-2, 1-2 did not qualify as such based on my moving averages and other indicators. I have now put up a much better labeling of the move. Either a 1-2, 1-2 (see top chart) or a-b-c with c = a (bottom chart). Now, I for one lean toward the bearish count, but that likely doesn't come as a surprise to any of my readers. I realize that the big boys didn't want to give too much of their August gains back, and tomorrow starts a new month and more volume should be coming back into the market. However, it is also important to note that the last time we had a gap down and a near break of the trendline, the bulls recaptured the both. If they don't this time, then the charts are absolutely setup for a 3rd of 3rd wave and the beginning of primary wave 3!


  1. Not to be argumentative but I've been reading your blog for a while and though I agree with your bearish tilt I don't see how EW is actually predicting much of anything these days.

    The wave counts on your site and others are constantly being re-counted and then the next day everyone is scratching their heads.

    Perhaps EW really only works when the market is fairly left alone and thus human nature takes over and of course is predictable. Now, we have way too much intervention and changing of the rules. It's almost as if just when EW predicts the next big down leg, someone throws a switch to counter it.

    I guess at some point it will end but it doesn't look like the Fed and Treasury will go down without bankrupting the country first.

    Cheers and thanks for the blog!

  2. It has been quite a ride hasn't it. Well, I think EW has been able to pick points of pullback; I just haven't been able to ever reach a downside target ;-). Like any technical analysis sometimes the irrationality of the market can run you over. Best to your trading.