Friday, October 29, 2010

10/29/10 EOD Update

EOD Update
SPX - 15 Min

Another boring day in the market. All I'm waiting for at the moment is to see which green horizontal line breaks first. That is it.

In the mean time, this triangle is done or is playing out and may take some more time if it needs to. Per EWP, pg 52, "Many analysts are fooled into labeling a completed triangle way too early. Triangles take time and go sideways."

The chart above lays out three options that I'm watching for this triangle. Hopefully it's not too confusing.

Option 1: Labels in black.

The market completed the triangle today. In order to avoid being labeled a fool, see options 2 and 3 below

Option 2: Labels in black.

The market is still working on subwave [D] of the triangle and subwave (x) of [D] completed today. Next week, we may get a pop but not break above 1195.35. The range for (y) of [D] could be anywhere from the blue trendline to the green horizontal line above.

Option 3: Labels in pink.

The market is still working on subwave [C] with waves A and B of (y) completing today. A selloff next week would drop the market anywhere below so long as it is not below 1159.71.

The triangle will be deemed complete or voided should any of the two horizontal lines get breached; complete if breached to the upside and voided if breached to the downside.

I'm working on my bear count (related to option 3)and will post some more over the weekend. Until then, this is the focus.

12:50 PM Update

Perfect touch and rejection by the upper descending trendline. We may have just completed wave [D]. One more chance to go long IMHO when we dip for [E].

However, I will lay out an alternate option based on the 12:44 post.

12:44 PM Update

I still like the 11:48 AM count but wanted to put this one out there too. Need to see the horizontal resistance line break to invalidate that count.

Correction: Need to see 1189.53, the wave a high to invalidate this count.

11:48 AM Update

Remember this pattern? If it's a repeat, I think [D] may still be in progress and turns this triangle into an ascending triangle.

1o:00 AM Update

Triangles everywhere...

8:50 AM Update

I like this option. Looking for that 1177 target.
8:44 AM Update


That 8:18 idea was good while it lasted. C can't retrace a. The other scenario is a flat for y.

8:18 AM Update

I believe we are working on subwave [E] of the triangle and this is a very likely count. Whether we are seeing an a-b-c or w-x-y for [E], c or y is forming a triangle to end the corrective pattern for [E].

This would certainly explain the massive chop we are seeing.

7:05 AM Update


I think [E] is in. However, I would like to see a much larger thrust here.

7:03 AM Update

1180 looks like good support here too and though a little difficult to tell, but c/y of [E] could be counted as complete.

6:58 AM Update

Let's see if c of [E] extends .618*a at 1177. Watching a bounce there and [E] may be deemed complete.

6:45 AM Update

Here are my thoughts on the 5 min.

Pre Market

It appears subwave [E] of the triangle may be in. Now to confirm we need to see a thrust up and out over the upper ascending trendline. Subwave [B] must also be taken out.

1222 looks to be the thrust target for /ES. But keep in mind the alternate is that [C] may still be in progress. As long as [A] is not taken out, [C] may turn into a complex subwave with more whipsawing in store and make for yet another boring day.
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