Sunday, October 10, 2010

Weekend Update

Last week, the market thwarted several attempts to get anything going on the downside. At the end of the week, price left us on the edge of a potential bear channel ready to break out. Through all of this though, the market has been making several 3 patterns, which led me to attempt different triangle patterns. I first mentioned a potential ED pattern, although it didn't quite look right. Then I mentioned a wave 4 triangle, but the reversal pattern did play out right.

Where does that leave me now? I'm back to another ED count with the 786 retracement and a potential overthrow of the channel coming in to play tomorrow. In addition, we have a time relationship coming in on Tuesday where minor wave 2 = minor wave 1 * 1.5. This is the last of the minor wave 2 bear counts we've been tracking. If the bulls close this above 1175, then primary wave 2 is VERY likely not over. So this is a very critical juncture.

Best of luck!
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