4/30/12 - EOD Update [2:50 PM Update]

[2:50 PM Update]

DJI

DJI may be working a triangle for Minor 4. Again, Minor 4 has room to play out as either a flat, triangle or even a zigzag (tho rare).

EOD Update

I believe the market put in five waves down off the 4/27 higher and broke down out of the rising wedge.

Near term, all count options point to a quick bounce (maybe to 1400 or the bounce could already be complete) before one more leg down at minimum. If you are following the pink and bearish count, it would be more than that, however, all options may be looking for a test of the 20 day SMA at 1386.

1386 also represents a 38% retracement of the 4/23 leg up.

The alternate view near term is that the rally leg off 4/23 only completed a wave 4 today. See the 5 min chart below.

SPX - 15 Min

Lets see if the market wants to target 1388-1382.

SPX - 5 Min Alt

Maybe one more push higher first before a larger pull back.

SPX - Bear case

The bears are trying to build their case.

SPX - Daily Bollinger Bands

The bulls want to hold the 20 day SMA.

SPX - Hourly Bollinger Bands

A hold on the hourly 20 SMA may confirm the next leg down.

4/27/12 - EOD Update [5:15 PM Update]

[5:15 PM Update]

DJI

Perhaps the DJI is showing us what the SPX is going to do and follow the flat option I have under the SPX  bull count below.

Of course the same options also apply for the DJI as the SPX so we'll just have to see. One thing I do notice is that the DJI sports cleaner three wave structures off the 4/2 top.

The blue lines represent one path it may take if the Minor 4 flat option is in play. Lets see what happens in this range.

EOD Update 


No signs of the bears yet so all count options are still in play. I'm still primarily looking for the completion of five waves off the 4/23 low.

Once that leg completes, I'll be watching for either a corrective pullback to satisfy the black, green and blue corrective waves or the start of a much larger wave 3 down per the pink bearish option.

With the McClellan Breadth thrust just about in play and a confirmed daily MACD bull cross, the more bullish options (black, green and blue) should be favored here.

SPX - 15 Min

Pull back next or the beginning of minute [3] down?

SPX - BULLISH

Note the options for Minor 4. However, we are going to be more vigilant of Option 3 (2nd chart below) as well.

SPX - Mc Clellan Breadth Thrust

Pretty much a breadth thrust in play.

SPX - Option 3

Lets continue to watch this option.

SPX - W bottom

Target 1420?

SPX - Bear

This count is certainly not out yet but the bears are surely hibernating right now.

Could this just be one big bear flag?

4/26/12 - EOD Update [5:18 PM Update]

[5:18 PM Update]

SPX - Option 3

We all need to really start paying attention to this option I have posted a few times now. I don't think the most recent downdraft looks like a good Minor 4 so this would be the next best scenario should the market challenge 1422 and fail. It can even go as high as 1340.

So I will continue to post this option more to keep track of it.


EOD Update

The bears need to show up to the party here or the bulls are gonna take it all back.

SPX - 5 Min

This looks like five completed waves. 1384 - 1380 may be a good target to buy in if using EW to trade this here. This is not a recommendation or trading advice.

SPX - 15 Min

All four options are in play. Black and green taking charge and threatening pink.

SPX - W Bottom

So far price is back above the 20 day SMA and an imminent daily MACD bull cross on the horizon. This would lead me to believe that a challenge of the upper BB is imminent.

SPX - McClellan Breadth Thrust

Very close to a breadth thrust.

4/25/12 - EOD Update [7:53 PM Update]

[7:53 PM Update]

DJI

I keep forgetting to post my DJI chart. The last time I posted this.

EOD Update

Looks like AAPL gave the bulls a little pick me up. Shorter term, I have to favor the black and green counts, however, the pink count (tho adjusted again) still should make some bulls a little cautious.

SPX - 15 Min

If the bears really want this, their most bearish count should be coming to a close here. From here a sell off down to 1290-1300 needs to occur or else the bulls are going to either push for new highs over 1422 or keep the market range bound between 1422-1357 before launching to new highs.

SPX - W bottom

SPX closed above its 20 day SMA, which looks like an attempt to confirm the W bottom.

McClellan Breadth Thrust

Lets keep an eye for a potential breadth thrust. If so, there is a good chance that Minor 5 is in progress.

MINOR 4 - FLAT OPTION

Note the W bottom and a tag of the upper Bollinger band would coincide nicely with the Minor 4 flat option. Refer to the bullish 2 year chart below for the bigger picture.

SPX BULL OPTION

1. Minor 5 is in progress.
2. Minor 4 is working out a flat
2a. Minor 4 is working on a triangle
2c. Minor 4 may be working on a zigzag (low probability)

RUT appears to have completed a wave 4.

SPX - BEAR CASE

The game is not over for the bears yet but the bulls are trying to put an end to this count and to the head and shoulders pattern.

BEAR CASE

The bulls need to make a new high above 1422.

4/24/12 EOD Update [4:00 PM Update]

[4:00 PM Update]

RUT

SPX - Channel

EOD Update

SPX - 15 Min

As I mentioned yesterday, green and black were top contenders. I had to adjust the pink count and am starting to question whether it will play out.

SPX is still below its 20 and 50 day SMA and any quick pop tomorrow may just be a back test of the bear flag. I have that somewhere near 1382.

However, if black and green are playing out, it is possible to consider five waves up in the works off yesterday's low. So if there is a quick pop tomorrow  towards 1382, that would complete five waves up. A pullback within the buy zone may offer such an opportunity should black and green be in the works. The logical stop would be below 1357.

This is not a recommendation to trade but yet an example of how to use EW to setup a trade given the various count scenarios.

ES

So far it appears the market may like AAPL's ER and as mentioned last night, ES may be hinting at the green option, which would also apply to the black option.

4/23/12 - EOD Update [5:55 PM Update]

[5:55 PM Update]

ES

ES may be hinting that the green option for SPX is in play. Its currently backtesting the bear flag so we'll see.


EOD Update
As I posted over the weekend, I strongly suspected another leg lower. The market surely provided that today. My initial target range was the 1357-1340 zone and the market came really close to it at 1358.79

The bears brought the market down to the head and shoulders neckline and the bulls fought to close it above. The 15 min count option below shows the various options still in play.

SPX - 15 Min

Pink is still the top option with green and black as top contenders. Blue is hanging on by a thread.

Note the potential 'W' bottom setup forming. This may bode well for green, black and blue.

SPX - Daily 'W' Bottom?

SPX - H/S

RUT - Daily

RUT may also be supporting the green, black and blue options above.

4/21/12 - EOD and EOW Update

With the completion of OPEX I hope to see some clarity by next week since there are still several options on the table.

As I have posted over the past several days, I still give an edge to the bears or at least the case for one more leg down. Where this next leg down targets depends on the longer term count options.

I would guess at least a minimum test between 1357-1340 and of course more if the bearish head and shoulders is in play along with the 2 year bear option count.

The bear case:

1. Since the April 2 top, I can actually provide a legitimate five wave count down. As many of you know I always try to look at the squiggles and tend to dispute a five wave move down.
2. A bear flag is still in play
3. Price action has been range bound the past 10 days and was rejected at the upper end again.
4. SPX continues to close below the 20 day SMA after 4 back test attempts.
5. A bearish head and shoulders pattern
6. Weekly MACD is pointing down
7. RUT may be presenting a case for one more little push down (unless 822.72 is cleared)
8. A close below the 50 day SMA for a second day

The bull case:

1. Price is still contained within the rising channel
2. Since the 4/10 low, there are still higher highs and higher lows (to challenge the bear flag).
3. The daily MACD is trying to cross up
4. Still above the 13 week EMA

So I'd say at the moment, the bears may have this until the bulls can recapture the 20 day SMA and break out of the bear flag to the upside. But even then, as you will see in my bull option chart below, the bulls may still be consolidating in a larger range for Minor 4, should a flat be playing out.

SPX - 15 Min

SPX - BEAR OPTION

SPX - DAILY BBs

SPX - H/S

SPX - WEEKLY MACD

SPX - BULL OPTION

SPX - OPTION 3

RUT

4/19/12 - EOD Update [8:15 PM Update]

[8:15 PM Update]

SPX - 5 Min

I tweeted near the EOD today. This is the internal count for the bearish pink option.


EOD Update

As I mentioned yesterday, I favor the pink count due to the bear flag pattern and potential h/s setup here.

The market revealed a tad more but continues to leave us hanging. It has also presented a new green option, which I have highlighted below on the 15 min chart.

SPX - 15 Min

Pink, Green and Blue. That is the order in which I'm watching these options. The blue count from yesterday was removed and now the only bullish stance left for the bulls is a nested 1-2 i-ii up. I believe that is a very low probability setup but with OPEX, anything is game.

The Pink options has a nested 1-2 i-ii set up in the works. And if a larger five wave move off the 4/17 is in the works, the EOD bounce may be wave 4.

The green option has the market working a complex corrective down for either all of Minor 4 or possibly just minute [w] of minor 4. See this chart for reference to the bigger picture.

Blue is hanging on by a thread.

Daily BB

20 SMA rejection and a close below the 50 day.

SPX - 60 Min 

Channel watch.

HS

Watching the neckline. The bulls managed to put in an hourly hammer candle with confirmation into the close right at the lower end of the channel.