Friday, October 22, 2010

10/22/10 EOD Update- Trade Setup

EOD Update- Trade Setup

Well she sure took long enough. I believe we saw our pop out of the triangle into the close.

Targets that I have for this thrust all depend on what count is working out.

If wave y=.618 * w, I see 1188 as a good spot for wave (D) of the larger triangle.

If we are working on a wave 5 ending diagonal, y=w at 1193ish for wave (3) of the ED.

That is all I have for now. I'll take a look at the other charts I have (EW Oscillator and 60 min) to see what may be in play or not play there.

Have a great weekend!

12:20 PM Update- Trade Setup

She sure is taking her sweet ole time. I made some adjustments to the subwaves if this is still a triangle. EWP does state that triangles do need to take time and many analyst (yours truly included) often times draws them out too quickly.

My bet, which I still have, is that we pop into the close. Stop at 1178.

11:40 AM Update- Trade Setup

There is a remote possibility that we were only in a complex wave c corrective down to 1179.90, which is to be expected. Working on d up now and then a final little e.

Either way, we are close to finding out.

11:00 AM Update- Trade Setup

We are awfully close to violating the triangle. A break below 1178.99 would violate the triangle. However, this still counts as a corrective combination that still implies there should be a leg higher from here.

10:07 AM Update- Trade Setup

Looks like subwave e will end as a falling wedge/ending diagonal.

9:45 AM Update- Trade Setup

Here's an updated look. Sorry. Had to ditch StrategyDesk for now.

And the bigger picture.

9:15 AM Update- Trade Setup

Added long. I believe wave e is in or just about complete.

Sorry. The only chart I can post

8:48 AM Update- Trade Setup

Wave c of the tri may still be in progress or it is wave e. A break above wave b blue confirms the tri is done.

I think 1180 will hold before heading higher. Just keep an eye on waves a and b blue. Which one breaks first will be confirming the move.

Above b blue we go up. Below a and the tri is out.

I gotta run. Won't be posting for the next 1/2 hour or so.

8:37 AM Update- Trade Setup

SPX - 5 Min

Here's a potential trade setup for approximately 8-10 SPX points. I believe the x wave is forming a triangle.

The blue Fibs represent the projection for wave y of either (D) of the larger triangle or (3) of the ED option.

To confirm, let's make sure the waves continue to subdivide within the converging trendlines. A break below a blue and this scenario is out.

8:15 AM Update


Here's a 5 min view

8:00 AM Update


Here's an update to a few options I keep an eye on to keep things in perspective. I think we all agree this rally may be a little extended.

I don't want folks to think I'm all bull. The above chart is the best count I have going for the bear case. I speculated that a flat (possible expanded if we take out the April highs) may be developing.

So far, the structure fits the bill. Three waves down from the April high and three waves up since the July low.

Until we see a fourth and fifth wave print on this rally since July, this bear count remains very valid.

On the bulls side, however, that structure looks like another inverted head and shoulders with the neckline sitting at the April highs. I'm not sure how this fits into William O'neill's cup-and-handle formation either but that would be another bullish formation that may be forming.

The handle would be the pullback for wave 4 before the 5th wave breaks out above the 1200 resistance level.

7:05 AM Update


This is what the cash count would look like if this were a wave 5 ending diagonal. Keep in mind again, it is way too early to tell.


Looks like futures is sporting a very similar structure to the cash market. The following options are below:

1. A wave 4 triangle with either wave (D) in progress or wave b of (C).
2. 1-2 up of 5 of a possible ending diagonal. This is too early to tell but something to keep in mind given the steady ascent of the market in a choppy three wave structure.

We will find out more shortly.
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