Monday, January 31, 2011

ES and Copper Update 9:05 PM


ES has so far bounced over the 62% retracement level and currently back-testing it.


They say copper is a good commodity to follow as an economic leading indicator. Above is the copper futures, which appears as though it is ready to make a new high.

The daily MACD bounced perfectly on trendline support and on the verge of a bull signal.

1/31/11 EOD Upate [1:58 PM Update]

[1:58 PM Update]

Just adding the squiggle count.

EOD Update
Main Count

Not much to report other than the fact that my primary count is still intact and the bounce so far is shaping up as expected.

There are a few things I'm looking at that leads me to believe that a wave 5 up is upon us.

60 min MACD is on the verge of a buy signal, price closed back above two key trendlines I'm watching as well as the 20 day SMA .

One thing that concerns me about the main count is the fact that the bounce may count more corrective than impulsive when counting at the lower degrees. However on the hourly chart it looks like tomorrow should be seeing a third wave up, whether it's a wave c or 3.

However, there are a few things going for the "more downside to come count too."

1291-1295 will be a key level to watch tomorrow. If there is more downside to come, this would be the level where this bounce should reverse since it represents an approximate 62 % retracement plus it would fill in the right shoulder of an inverted h/s.

So if the market drops after a potential bounce, wither either:

1. Either a wave c/y of a larger 4 plays out to the lower daily Bollinger Band at 1260ish. This level would make c/y = 1.681*a/w.

2 It's a third wave down of a larger trend change in store.

Daily Bolliner Bands

Some key trendlines holding.


Small caps may be hinting at a breakout towards the upside too.

Sunday, January 30, 2011

ES - Wave 4 Flat

If we just witnessed the conclusion of a wave 4 flat, this is how I would count it for ES.

One thing to note, the top of the range (pink) would equate to a 62% retracement of Friday's decline.

Corrective Count [6:38 PM Update]

[6:38 PM Update]

Something to potentially keep an eye out for.

SPX 1 Min - Corrective Count

This is a follow up to my EOD Update #2 on Friday.

Here's the 1 min corrective count I believe is more appropriate. Look at the little ED for wave c of wave a red's zigzag. That shouldn't be there in the heart of a wave 3.

Notice that wave y may have further to go possibly down to 1270, which would also align with the KISS post yesterday.

Saturday, January 29, 2011


1/29/11 - Impulsive vs Corrective Options

We all know there is no certainty in life. So why would Elliott Wave be any different?

Whether it be long term or short term, EW provides a multitude of options by way of wave counts but what many continue to forget, when applying EW, is that it is about "limiting the possibilities".

So below, I have cleaned up some of my corrective counts and placed all the most likely scenarios I believe to be in play onto one chart.

As for the impulsive count, I believe the cup and handle chart I have been posting is the most likely scenario at the moment. I have not gotten around to creating an impulsive chart like the corrective one below, but will do so hopefully by the end of the weekend.

Keep in mind things are subject to change, such as life. However, what is presented to us at the moment is what it is so that is how we should roll; for now.



Friday, January 28, 2011

1/28/11 - EOD Update #2

There was a lot of technical damage done today. The count and options I presented yesterday have been whittled down to two. Either a wave 4 flat completed today or is near completion or a short term/intermediate top is in.

I'm still on the fence as to what type of top.

Here is the main count with the bearish option. However, I have some reservations regarding today's drop. I posted that earlier today here.

MACD daily is right at trendline support. If the bull case is still in play, it needs to bounce next week. Price also dropped down into the lower channel.

Here is the cup n handle chart to give you one perspective. This matches with the main count above with the appropriate degree labels.

Look at this puppy. I initially posted this chart on Wednesday.

Almost like clockwork, the 8th day after the MACD topped, we saw a long red candle for the second time in the row. MACD was also rejected on the backtest.

The point drop for both were almost identical too. The 4/27 drop was approximately 26 points. Today we dropped 23. What would have been even more interesting is if the 4/27 drop had occurred on 4/28 since today is the 28th.

Here is a closeup of the drop today and why I question the impulsiveness of the drop. It is very similar to the 1/8/11 drop.

Any how, because of the technical damage done today, closing below the 13 day EMA and key trendlines I have been watching, we need to consider this as a possible new wave down.

So for next week, a wave 2 bounce would be in store. We'll have to look for a proper Fib retrace in the 38-62% range once the low is in.

Keep in mind only one wave down has completed. One must also give consideration to the fact that it may only be a wave 'a' because what if we did top but this is a top of a larger degree wave 3 and we just saw the first leg of a larger wave 4? Just something to think about.

That's just something one must do if analyzing Elliott Waves. Because waves 1,2, 3 is identical to a,b,c in a series. It is wave 4 that differentiates a impulse from a corrective wave.

1/28/11 EOD Update- Caution to the Bears again

Caution to the bears again. This is a quick glance and squiggle view of today's decline. I'll spend more time later to make sure of the count. But I'm seeing the same problems as I did with the 1/18 - 1/20 decline.

Check out the post for the last wave down below. Gotta head out. Will post more later.

Even though the chart below looks ominous, the main count is above. A key trendline is still holding along with the daily MACD trendline on the chart below.

The drop on the 8th day back in April was approximately 26 points.

Thursday, January 27, 2011

1/27/11 - EOD Update

EOD Update

The market broke through 1300 a few times today but could not close above it. I'm still watching the chart above with each of the 4 options in order of preference.



Here is the update to this chart posted yesterday. I'm not top calling here but just pointing out something of interest.

Well today was the 7th day from the last MACD spike high and MACD is curling up on the underside of it's signal line. Will be interesting to see if tomorrow fails like it did in Apr.

It even traded in a 7 point range very similar to the 9 point range in April. Makes you wanna go hmmmm.....

9:00 AM Update

9:00 AM Update

Sorry been busy updating charts in the chat room .

Here's the 10 min view of the primary. Below is an ED option that I am now watching as well.

Wednesday, January 26, 2011

A Top Tomorrow?

Did I get your attention again? I don't really have any thing substantial to say about it other than a small observation.

Many are saying the behavior up here is very similar to the Apr 2010 top. I figured I'd take a closer look again as well since my last post on this comparison two weeks ago.

I'm only basing this comparison using the behavior of MACD. Back in April, MACD dipped under it's signal line twice and then peaked before crossing back down. Once it had crossed back down, it failed to cross back right about where the market reversed.

Notice the long red candles that printed the day after MACD peaked (red lines)? By the 7th day after the MACD peaked, the market reversed.

If the market is repeating this pattern again, tomorrow is the 7th day since the latest MACD peak. Based on the last behavior, the market traded in an 8 point range that day.

We'll see if this is the case. I bring this up now because based on my wave count options, we are very close to printing the final fifth wave, which would be consistent with what may be happening here.

Keep in mind though, the are still a few options as to what this top may be. I also point your attention again to the fact that a multi-month trendline support is in play for MACD starting back in May.

1/26/11 EOD Update

EOD Update

Busy day at work today so I apologize for not posting any updates throughout the day. It appears I didn't miss too much anyway.

So far things continue to march up as expected. The channel in the chart above continues to be respected and the bullish leaning daily MACD that I have been tracking is starting to turn up right at trendline support as previously anticipated.

As the market stair steps higher along the channel, the top of the channel continues to push higher. The top now sits at approximately 1317. Wave 5 black = .618*1 at 1318 on my chart below. We also know there is a pivot resistance level at 1313 so something to be mindful of.


Here is the primary triangle chart I'm following along with the various options. The primary count I'm watching is that wave ii of 5 black completed today or is about to complete. A wave iii up is on tap.

The other options available are on the chart.

5 Min

Here's a 5 min view of the internals out of the triangle.


The INDU is sporting a possible ending diagonal. The maximum length for wave v of the ED is marked with the Fibs.

However, notice the alternate labels in blue. The alternate would keep INDU fairly consistent with SPX in terms of pushing for newer highs.


Here's a follow up to the RUT that was posted yesterday. A buy at the bottom there turned out to be a good move.

As I mentioned yesterday, the daily MACD trendline support may have been key. This was also applicable with SPX above as mentioned.

60 MIN

Here's the 60 min showing the projection for wave 5.


A 3 min showing the internal of the bounce off the bottom of the channel.

Tuesday, January 25, 2011

1/25/11 EOD Post [2:00 PM Update]

[2:00 PM Update]

Forgot to post this channel chart. 1313 sits right at the top of the channel, if that is the market's intention.

EOD Post

I would like to say with a pretty good degree of confidence, the triangle is playing out and it was completed today.

I have highlighted some targets for wave 5 black based on the tri thrust target, inverted head and shoulders pattern and 5th wave extension ratio to wave 1. They all point to approx 1320.

However, there are some other options on the chart above as well. They are:

1. 4 ended 1/7 and working on waves 1 and 2 blue of V
2. 4 triangle complete, labels in red.
3. 1/20's low just wave a green of a red of 4

***Until a high above wave b red is made, the tri and flat scenarios may still be in progress. ****

Here's that fib fan chart I have continued to watch. Notice the next pivot target is 1313? I must also mention that 1303 exist as well.

The next three charts are for the RUT. Do you buy here?

Like the SPX, a wave 4 most likely completed today and now a rally for a wave 5 is most likely in store.

12:09 PM Update

12:09 PM Update

Falling wedge for wave e??

11:24 AM Update

10:48 AM Update

Sorry. Been busy in the chat room. I think there is a good possibility wave e of the triangle may be complete.

Pre Market


Looks like a moderate drop at the open is setting up. If the bears want to come out of hibernation, this is going to be the time to do it since there is an initial five waves down (at least one may be counted as such, though it is a lil suspect) and the three wave bounce.

There are a few options on ES above, which is very similar to the cash counts I have been providing. Notice the triangle potential in there as well?

Below, I have labeled my top three options as A, B and C. I have been pushing the triangle for the past week or two now and that remains the top option. Until the count is invalidated, that is the one I'm primarily watching.

However, that does not mean charts B or C cannot run their counts parallel with A and all remain valid at the same time and at times all may indicate a move in the same direction.

For instance, this morning's potential opening drop is still acceptable for all counts. There are thresholds to watch to invalidate those counts. They are listed on the charts so keep an eye on those. Until those counts are invalidated, assume they are all in play.

Chart A

Chart B

Chart C

Monday, January 24, 2011

1/24/11 - EOD Update [4:47 PM Update]

[4:47 PM Update]

Here are some more internal counts to support the options on the main chart below (the one with the light green ascending trendline). This option here has wave 2 blue still in progress possibly forming a flat.

Here's the bear count.

All counts still look for a push higher to approximately 1295ish.

[1:57 PM Update]

Here's an update on the corrective count internals that would support the triangle option. The top on this chart would either represent subwave d among others. See below for the addtl options.

Vodavi in the chat room also presented an ED option we must be looking out for. I really like this option as well.

EOD Update

Here are the options on the chart above.

2. 4 ENDED 1/20

This 5 min chart supports option 1 on the chart above.

I'll try to post the internal counts for the other options later tonight.