Monday, May 3, 2010

5/3/10 - SPX EOD


 Elliott Wave International

 Elliott Wave International
It's certainly nice when the market goes your way after making a call . Last night's post called for a move to 1205 and today we got it.

The market was able to close above the key moving averages once again. So what is now in store? The market continues to slosh sideways within a rectangular pattern.

I have provided two  figures from Elliott Wave which are called double three formations. This formation is called a combination since there are a combination of EW patterns stacked together separated by an "any wave" or "X" wave.

I hope these figures/formation will help you understand what my current thoughts are for this Minor B wave that appears to be taking on a rectangular pattern.  These are but two examples of a combination that I believe we may be witnessing for Minor B.

Compare the two figures above with my 60 minute chart below and you will see something similar is developing. I drew in red lines of some possible paths the market may take. In my example below, I drew in red lines for the second (or double) "three" as another a-b-c resembling a flat. 

The figures above provide two different options, a triangle and a zigzag as the second (or double) "three". So these are final patterns to be looking for as well over the next week or so. So keep an eye for another flat, triangle or zigzag. 

But first we have to complete what I believe is a minute [x] wave or as the figures above labels as "any three". I consider today's rise as part of minuette (c) of minute [x] of Minor B. Targets for this (c) are:

if (c) = (a) = 1215
or if (c) = 1.618*(a) = 1231

**Note: I just thought of something. On the 60 min chart below, my minute [x] wave may also have completed on 4/29 and we may be working on the second "three" now. If there is more evidence of this occurring, I'll update my charts to reflect that should the need arise.**

** One more thing. I normally do not post about Fibonacci time ratios but for those who believe in it, Minor B would complete at .382 time of A at approximately 5/12. We'll see**


I also have a few other options on the table as well. The alternate counts are labeled in gray (notice that the alternate counts are stacked in order of preference). The following is a summary :

... today's rise was minuette (iii) of [v].
...or: we are working on a larger minuette (c) wave down towards 1150
...or: we are working on minuette (iii) down

I posted a 5 minute chart this morning using TOS (since I'm still having problems on my Strategydesk) and highlighted some channels as potential paths for the market. It appears the red center channel was breached to the upside and capped at the upper blue channel. The market pulled back and so far has found support back at the red center channel.

Based on the wave count, I believe it most likely will take out the upper blue channel again but we will have to see if it holds.

So there is work to be done on both the bull and bear camps. We have key support (1180) and resistance (1220) levels to watch as a break in either direction will dictate what we ultimately have. 



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