Monday, February 1, 2010

2/1/10 - SPX Primary and Alternate Counts


Primary Count


Closeup of the Running Flat



Alternate Count2


A had to make some minor tweaks to my count. Overall, I show us still in minute [i]. I just can't get away from the sideways nature of the move so far. There are three sets of wave 4s by my count to go with the three sets of 1s and 2s.

Notice that each 1-2 count resulted in a sharp wave two reversal? Now look at the wave 4s; all are flats. This looks pretty good to me in terms of alternation between the wave 2s and 4s.

The last flat may be considered a running flat. According to EWP, Page 48, running flats are rare, however, "the forces in the direction of the larger trend are so powerful that the pattern is skewed in that direction. The result is akin to the truncation of an impulse."

Note that EWP states that this is a rare formation and 9 times out of 10 it is most likely not a running flat. Something to keep in mind.

Based on this count, I have the final wave c(green) completing with a wave five ending diagonal that appears to have throw-over. Wave c(green) =a(green at 1089 or price kisses the descending trendline below.

I have labeled my first alternate count on this chart. I have minute [i] in at 1071.59 and minute [ii] in progress. If this alternate plays out, minute [ii] may like the 1100 level +/- 5 points.

My second alternate count is still in play as well but it's not without problems.

The subwaves count well as 3-wave structures, however, subwave c is shorter than b. By rule, wave c, d and e each moves beyond the "end" of the preceding same-directional subwave. This is not the case in this structure.

I'll be watching the upper expanding trendline tomorrow and what subwave c (red) of e (green) does. subwave c(red) = .618x a (red) right at the upper expanding trendline. C achieves equality with a at approx 1099.

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