Sunday, March 27, 2011
Okay already, I'm back to make an EW count. First off let me say that the bulls are really sticking it to the bears and the last week has been a perfect example. They have driven through resistance lines without even flinching. What value in the future they see, I have no idea, but there are enough of them that they are overwhelming all the sellers.
So, here are my counts:
#1 - We just completed an A-B-C-X and have an A-B-C to go.
#2 - We just completed an A-B-C and are going to take out new highs.
#3 - The market is very very wicked taking in all the buyers in an incredible wave 2 that fails tomorrow and continues to impulse down for weeks to come. I know, not likely, but someone has to put it on the table.
The market has already broken a weak channel resistance line and looks like it may be vulnerable at the 786 retracement zone. A gap down tomorrow is shortable.
Posted by Rich at 10:33 PM
Wednesday, March 9, 2011
Yesterday saw what appears to be the last test of the support line and an upward explosion. The momentum was so fierce that it eclipsed the momentum of what I'm labeling the 'b' wave of 'C' leg of the triangle. This will be confirmed with a close above yesterday's highs. Assuming we don't get a 5th wave extension out of the triangle, which I'm not as this rally is already over spent, I would expect the 5th wave to end in the 1354/1360 area based on the size of the triangle.
Posted by Rich at 4:46 AM
Monday, March 7, 2011
Wow, can you get both scenarios so wrong??? Today's move down leaves us pretty much where were over the weekend, except the count has expanded.
Primary Scenario: Triangle has now moved up to my primary count based on the futures movement after hours. An open below today's low would eliminate this count.
Secondary Scenario: Added another subdivision to the wind up today. Tomorrow will open below today's low.
There you have it. Today cost me....
Posted by Rich at 7:28 PM
Sunday, March 6, 2011
I realize there were some violent swings during the week, and I apologize for not chiming in with my views on market action. So, now that I've had some time to analyze the charts, here are my two scenarios:
Primary Count: Monday kicks off a 3rd of 3rd down. It starts with an acceleration gap below Friday's low and possibly below last week's low. This should be pretty easy to invalidate based on where the futures are trading tomorrow morning.
Secondary Count: Friday finished of a 4th wave triangle and began the 5th wave. It only matters that the market opens above 1315 and takes out 1320 within the first 15 min of trading.
The bearish count takes the primary count due to the VIX movement, the weekly reversal, Thursday's double top failure. We soon shall see...
Posted by Rich at 8:26 PM