Thursday, September 29, 2011

EOD Update [2:09 PM Update: Introducing Blue2]

[2:09 PM Update: Introducing Blue2]

I believe I may have introduced this option about a month ago but dropped it for the time being since it was way too early to track.

However, 1 month later, we must once again be reminded of this potential option. I bring this back since there is still no impulse wave down to begin wave C yellow and since lower highs are being made.

As far as the triangle for wave (Y)/(C) goes, it is technically still early to call but now is a good time to start thinking about it.

Blue2 Count

EOD Update

Still no signs of a larger impulse wave down. But as you can see just because a wave is corrective in nature it does not mean it is not capable of moving great distances.

Anyway. Wave (x) retraced a little deeper than anticipated but in the chat room, while analyzing the wave structure, I was able to spot a mini pattern intraday that appeared to be repeating the larger pattern yesterday.

Sure enough the market sold off further and so far found support right at the 62% retracement level of wave (w), which is a very reasonable retracement. The market then  bounced out of what may be a bullish falling wedge  at least that's what it looks like at the moment.

1162 will be the next challenge as that is the near term TL (9/27 - 9/29 high) that may provide resistance.

Notice the "ALT" labels I have placed on the chart as well? It is very possible a much larger LD may be in the works.

Though wave ALT 4 is out of the wedge, it is still considered acceptable to a degree as a throw-over. Not sure how far it can go but I'd say it would be safe to assume if price can clear the blue TL, the ALT labels can be voided.

So once again, I believe the market may be working on wave (y) up. I have provided some Fib projection targets should this be the case.

If the market is not working on wave (y), I believe a 62% retracement of the falling wedge should not be unreasonable to expect. That would place the market right around 1175.

So for tomorrow, unless the 1162 area caps the bounce, 1175 would be the first target I'll be looking for this bounce to go and then followed by 1190 (will also keep an eye on the red TL above).

Something else to keep in mind. The market has attempted to break over the 20 day SMA now. It has made three daily attempts.

Based on the wave structure/pattern (a potential bullish falling wedge) at hand and the fact that it is still just sitting below it, there may be a good chance it finally breaks over it the next day or two.

10 Min

Daily Bollinger Bands
Three attempts at the 20 day SMA. Will the 4th time break thru?

Blue Count
(y) up may have started today.
Red2 Count
Wave y gray of ii red may have started today. Note that it is very possible that wave iii may already be in progress. Today would have completed the first leg down for iii and the bounce for the 2nd leg may have begun today. So either option is looking for a bounce.
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