Sunday, March 6, 2011

3/6/11

SPX Primary

I think I like this option for SPX. Look at the RUT chart below, which may also be confirming this (though I didn't update my RUT count to reflect the 1-2 up like SPX). Friday's retracement was sharp and approximately 62% of wave (1).

The RUT and INDU price action is also not tracing out an ascending tri like SPX options I presented last Thurs.. It is possible they may be tracing out a larger acending tri but that implies a test of the high put in at 2/18.


The ES chart is clearly forming a triangle.

It is very possible wave (e) may be complete or close to complete. The other obvious option is that wave (e) targets the lower trendline near 1303. Keep in mind wave (e) may also form a triangle itself.

We'll see how this translates into the options presented last Thurs for the cash market. However, ES may also be labeled to reflect the SPX count above as well.


RUT

A few things going on with the RUT that makes me believe a stab at the 2/18 started last Fri.

1. A higher low once again.
2. A clean bounce at the 50% retracement and descending trendline
3. MACD turning right at trendline support.
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