Tuesday, August 9, 2011

8/9/11 - EOD Update [9:32 PM Update]

[9:32 PM Update]

Tonight, while looking at stats for my blog, I noticed that traffic was being driven from Elliott Wave Predictions . I have never seen this blog before but I am impressed.

So much so because today's post of the INDU is so close to my most recent bullish count that was eliminated due to the sell off. However, Sid's version of the count keeps that count alive and simply has a very short and truncated wave 5 vs the 146x target I was looking for.

I have updated that count in TOS and will now add it to the current count options. Keep in mind, though this is long term bullish, it is intermediate term bearish.

A proper Fib retracement may drop the market to 1015 or 933 or the 50% and 62% Fib retracements respectively .

One thing to keep in mind is that so far the market has bounced at the 38% retracement level as well. So we'll have to keep watch of that.

[9:21 PM Update]

Some other weekly MAs I'm watching.

Here's an H/S setup to go with that death cross.

[8:52 PM Update Death Cross Watch]

Let's keep an eye on this one. The last death cross last July did not pan out and neither did the head and shoulders pattern.

Well, the H/S panned out this time so will a cross mean anything this time? We shall see.

EOD Update

What a wild ride today. This bounce was way overdue.

The bulls shouldn't get all excited at the moment. There is a lot of ground to make up but this is a start for them. I wanted to see the market close above 1150 to maintain the bullish options.

Price finally closed back into the daily Bollinger Band and I believe the VIX also closed back inside as well after closing outside. We should be watching for a follow through tomorrow if the VIX buy signal is to be confirmed. This will require the VIX to close below today's closing price of 35.06.

Should this week close green, a weekly hammer candle will form and potentially above the 200 week SMA. I will update you all on this at the end of the week.

5 Min

I think this leg down is complete. Looks like the bounce off that low is a clean five waves up.

Where does it fit into the bigger picture? See below.

From the ultra bullish option standpoint, either wave ii is complete or wave 3 of c of ii.

From the corrective option standpoint either:

1. Wave b of Y
2. Wave 3 of a new impulse wave down.
This is the larger view of option 2 from above.
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