Wednesday, June 9, 2010

Wave 2 over, where do we go from here...

The market pushed prices over my target by several points (1072 was my high target and today's high was 1078), but was unable to hit my upside target of 1085. Prices reversed from there and is now setting up for our next move. The problem lies in where we are in the count. Here are my alternatives:

Super Bearish (Primary Count): We are about to begin the massive 3rd of 3rd of 3rd. Looking for a minute wave 3 low around 920.

Bearish with a retracement coming (Alternate Count): We are about to finish a leading diagonal with a 5th wave target at 1000. This will also backtest the multimonth trendline that was originally taken out. The reversal from here should be significant.

I'm looking for a minor wave 3 low at the 786 retracement from the March 2009 low.

Best of luck!
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