Thursday, April 1, 2010

4/1/10 - SPX EOD




Well it looks like we got that triangle breakout as guesstimated last night. The very top chart is the main overview of the count. I like how price is contained within the channel. Minute [iv] looks like it is complete. Right on the lower channel line.

The second chart is the closeup of the triangle to complete minute [iv]. I made a slight adjustment from last night's post. I believe subwave (e) completed at the 1167.15 low. A subminuette i and ii wave have completed and iii began into the close.

The targets for minute [v] have not really changed. I'm watching for a 5 wave count up. The center channel line or top channel still look like great targets along with the thrust target near the 1208 area.

It is possible this formation may have more to go. If anything, this structure does look like an ascending triangle (see here for more), which is a continuation pattern. We have the minimum two equal tops and rising troughs. A chart of the SPY highlights this option below. Bottom line, that implies more upside to come.

Here again is an excerpt  from Elliott Wave Principle, 10th Ed., Pg 51, regarding triangles:

"In the stock market, when a triangle occurs in the fourth wave position, wave five is sometimes swift and travels approximately the distance of the widest part of the triangle. Elliott used the word "thrust" in referring to this swift, short motive wave following a triangle. The thrust is usually an impulse but can be an ending diagonal. In powerful markets, there is no thrust, but instead a prolonged fifth wave. So if a fifth wave following a triangle pushes past a normal thrust measurement, it is signaling a likely protracted wave."

Keying in on the red text, we should expect a swift 5th wave up targeting the thrust projection. I will also be keeping an eye on an ending diagonal formation as well.

If there is no thrust but the market pushes price up past the thrust target, hold on because it may be signaling a protracted 5th wave.

The third chart at the top is an alternate count that I'm looking at along with the fact that this entire leg up from 1044.50 may only be Minor A of (Z).

Happy Easter everyone!


  1. Hey Grand-- have been thinking about a count and was hoping to bounce it off you: the expanded flat. I have the orthodox bottom of P1 in Nov 2008, followed by an expanded flat, with c up starting at 666. In the most recent decline, i had that wave end Jan 29 at 1070, also followed by an expanded flat, with c starting at 1040. Could it be that the orthodox top of P2 was indeed Jan 19th, and we're in another expanded flat? I feel that would help explain why no on can figure out how to count this rally as impulsive since it is actually a B wave... Would love to discuss this with you, what do you think?

  2. (hey, sorry-- this is scw)