Thursday, October 28, 2010

10/28/10 11:20 AM Update

11:20 AM Update

Vodavi brought up a good point earlier this AM in comments regarding a complex wave [C] scenario. I certainly would not disagree with this possibility.

I still have as the preferred count at the moment that we are working on [D].

Until we get a decisive break above 1196.14 or below 1159.71 we should be whipsawing up and down to complete this triangle.

10:07 AM Update

Looks like we may have our break out of the falling wedge for wave b/x of [D].

Targets for this are c/y = a/w at 1195 and c/y=.618*a/w at 1189

9:42 AM Update

Had to step away for a sec. Looks like this may be a falling wedge. Consistent with a wave b or x of [D]

8:27 AM Update

An hourly MACD buy signal is imminent. The last time we had a cross from under zero was on 10/20. The market made two higher highs from there.

If this repeats, this may target the wave [B] high at 1195 and form the ascending triangle as I have mentioned a day or so ago.

8:05 AM Update


Here's the 5 min view without the trendlines. MACD is heading up.

8:00 AM Update


Here's a quick 1 min view to show the channel break on that retrace down. Either wave (x) is complete or wave a of (x) is complete.

7:35 AM Update


So far a pause at the 50% retracement level in a three wave down. If this is still an (x) wave of [D], keep in mind that this wave (x) may be a triangle itself so we could potentially bounce around before one more spurt to the upside to complete [D].

7:20 AM Update

Looks like wave [D] of the triangle may be in . Subwave c of [D] = 1.618*a of [D].

I did place a wave (w) at the top of [D] as an alternate because on the hourly chart, the move off [C] does not look like a clear three wave move up.

So we are either working on [E] down now or just (x) of [D].

Here is another example of an EW trade setup. Should we be working on [E] down, a move to 1180-1177 may be bought with a clearly defined stop (below wave [C] at 1171). If the count is correct, one may be able to ride a 20-25 pt move up when this thrusts out of the triangle.

6:50 AM EUR Update

EUR/USD appears to be working out a possible triangle as well. It should coincide with grinding it's way down towards the daily MACD trendline. It may not either and just create a higher low. We shall keep an eye on the histograms.

Pre Market

Here's a look at the futures market. So far the triangle is looking right on track. As I mentioned yesterday, it is possible that wave [D] travels as high as the end of [B] to form an ascending triangle.

The second chart is a closeup and shows the fib relationship of wave c to a of [D]. A .618 ratio gets up 1187 and 1193 if c=a.

Yesterday there was a discussion regarding my ED count in that wave 2 of the ED was not a zigzag (it was a flat), which per rule it should be. I mostly agreed with that argument and dropped the count.

However, I believe the market is still wedging higher and other indices may be sporting a legitimate ED. Ultimately if the market takes out wave [B] of the triangle, we may have to bring this option back to the table as a consideration.

GL today.
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