12/2/10 -EOD Update - Target 1232? [Update 9:47 PM]

[Update 9:47 PM]
Remember this Fib fan chart? The market closed over the yellow 50% line. Interesting....

And a look at the daily chart I have maintained for some time.

[Update 4:19 PM]

3 min

We'll see if it's correct.

[Update 3:43 PM]

Option 1b

Option 1c

Here are options 1b and 1c again. As bullish as the past two days were, option 1c remains valid.

Option 1b is nearly identical in count to the /ES count presented below. I have it either completing minuette (iii) or minuette (iii) completed. MACD may be hinting at it's completion.

Option 1c, if completed, would complete minute [b] of Minor 4. Notice the Fib retrace level achieved? 90%. That is the minimum requirement for a flat and SPX has now achieved that minimum.

If option 1c is correct, we should see a drop back down towards minute [a] and a little beyond to complete the flat.

I will try to see if I can update my 3 min chart later to see if we can determine if this leg up is complete.

EOD Update

/ES

I have a feeling there are a few more points to go before we see the end of minute [i] for Minor 5. I made some adjustments to the ES count I posted this AM that may make sense.

As I posted on my 3 min chart last night I hinted at a possible nested 1-2 start to this wave up. I think that has a occurred and I believe at the moment /ES best represents this count. I'll post updates to my option 1b and 1c counts later. Option 1b best fits with /ES.

Reverse Fib Technique

Do you remember this chart? I posted this a few times in the past and was expecting the market to eventually hit the 1232 mark after it hit the 1183-1190 confluence area.

Notice that the previous confluence provided a level of support before this recent bounce?

Daily Bollinger Bands

The daily MACD and Bollinger Band looks bullish. MACD is on the verge of a buy signal and not to mention the bounce off the longer term trendline.

What is interesting here is the top of the Bollinger Band currently sits at 1232. I believe the large inverted head and shoulders target is also at this level.

12/2/10 Pre Market

Pre Market

/ES

Futures are sporting some pretty clean waves. I have adjusted my option 1b to reflect this.

Option 1b

I have included options 1c here again.

Option 1c

12/1/10 EOD Update [Edit 10:13 PM]

[Edit 10:13 PM]

SPX 3 Min

Here's an internal count to support both 1c and 1b. It is possible there is a nested 1-2 setup but I won't address that if it appears the market puts out multiple 3-4s.

[EOD Update]

I thought I would have more to share tonight but all I have are the updates for option 1b and 1c.

Option 1c

I didn't have to change anything here. Wave [c] of c/y accelerated out of the gate as anticipated. I still leave the option at the top as c/y because [A] and [B] could very well turn into a five wave impulse to complete wave c versus the [A]-[B]-[C] that would make up wave y.

I place this option first because it counts the easiest and for some reason I still remain cautious calling an end to Minor 4.

Wave form wise, it just doesn't "look" right nor does it look proportional compared to the size of the Minor 2. Please see the chart below.

When I created this chart, I drew the channels based on the 1-3 line (end points of waves 1 and 3). Generally EW channels allows one to predict where wave 4 may land based on this channel.

Though it is not a hard set rule it is a tendency that has been observed in the past. Looking at the channel that was previously created, Minor 4, if complete now, only travels a little more than halfway across.

It just looks a little too narrow especially if alternation were to be considered. Alternation of course is not a rule either.

But because there are tendencies for wave 4 that have not been met and the fact that option 1c remains a valid count, I remain cautious and will continue to monitor this as an option.

Option 1b

Now for option 1b. I removed the ending diagonal option from earlier. At this point I think it is moot because the ED or the double zigzag as I have it labeled ends with the same result.

Based on this count minute [i] of Minor 5 is underway. Now it is debatable how the squiggles may be counted. For now, because it appears that we only have three waves up, my wave i is at 1184.53.

Should a pullback occur and retrace into this level, I will most likely rule out the impulse wave count.

Another version of the count that I like a lot is one put out by Daneric.

Here is a look at the daily MAs and MACD that would support option 1b. I just wanted to highlight the trendline support for MACD.

As Minor 4 had been playing out, I was anticipating that Minor 4 would complete at this trendline. So far that seems to be the case. So it is possible we have seen the end of Minor 4.

But just looking at the chart above, price respected the center channel and MACD is looking bullish.
I'd like to see 1200 hold as support going forward and no more than 1190 to further confirm that Minor 4 is in. This would equate to a 38-62% retracement for wave iv to wave iii of Minor 5 based on the option 1b count above. And this all assumes wave iii is complete, which it may not be.

12/1/10 - 1:43 PM Update

1:43 PM Update

Looks like option 1b and 1c are front and center. I think I'm 50/50 on both counts with maybe a slight advantage to 1b since we closed above 1200.

The main problem I have with option 1b is trying to count a clear impulse off the 11/30 low. I came up with a possible squiggle count earlier in the chat room but that depends if an expanding leading diagonal is considered an EW pattern in the wave 1 position.

I'll post charts later


7:04 AM Update

Opt 1c

[C]=1.618*[A] marking a possible turn point.

Pre Market

Opt 1c

Though we are set to rally at the open, keep this count option in mind. 1200 is the key on the upside. I believe market participants want to see a close above this level. Let's see if she does.

Opt 1b

Here's an alternate version to this count last night that would support a reason to be cautious.

Cup and Handle

I posted this chart back on 11/5/10. Not sure if the handle needs to extend lower but if the market clears the top of the cup with decent volume, that may be the signal. Click on the link to the previous post if you want to read more on this formation.