Wednesday, October 21, 2009

10/21: SPX and TRANS

SPX 10/21/09


SPX 10/21/09




It looks like that 9 wave count came to fruition. Nine waves completed with 13 total from 1019.
It should be noted that the (A)-(B) ascending trendline (March - July lows) capped off prices as anticipated.

I think it is safe to say that we have reached a top of some degree. At the moment, I am leaning towards a P2 top with an alternate view being that we have reached the top of minor 3 of Intermediate (C).

Because there are still a few bullish counts out there are two levels I will be keeping an eye on to invalidate those counts.

A break below 1080.15 would invalidate the alternate count on this current chart. A break below 1039.47 would more than likely confirm a true trend change has occurred.

The case for a double top on the transports continues to build. Six attempts were made to break above 4053 unsuccessfully. Volume on the selling was much heavier today.

What is very interesting is the large price swing which occurred today. Nearly 200 points on the Dow and 20 on the SPX. It reminded me of those price swings during the heart of the collapse. Could that scenario return?

Momentum has certainly waned. The market continues to sell off on the "good" news.

Tomorrow will be interesting to see if there is some follow through to the sell off.

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