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5:30 AM Pre Market Update

5:30 AM Pre Market Update

I'm maintaining watch on Dr. Copper who appears to be forming an ending diagonal. Either wave 4 is complete or one more push to the dotted TL is required since it appears as though wave b of 4 may be forming a tri.

HG

If 4 is complete, wave 5 should be expected to tag the lower TL and cannot exceed 2.848 or wave 5 will be greater than wave 3.

ES

ES has put in a  lower low beyond the 8/9 low. For cash I'll be watching the 1090-1080 zone for a bounce where v=i at 1085.

15 Min

EOD Update [10:00 PM Update- AAPL Done? Copper Bottom?]

[10:00 PM Update- AAPL]

AAPL may be done.

20 Year

5 Year - Close up

HG - 60 Min

Wave Y of HG may be wrapping up here with an ED. Keep an eye out for this. The bigger picture is just below.

HG - 5 Year

[4:50 PM Update]

Red Count1

Here's the original red count I'd been tracking before coming up with the ED count for C yellow. This is the same chart as the "A Pretty Bearish Chart" count at the bottom of the page.

It goes without saying that the bears are in control. From a trading range standpoint, the market is back to the lower end and at midpoint of a larger range. Can the bears push this further down into the bottom half of larger range towards the 1010 level?

Range

VIX

The last VIX equity buy signal failed. VIX closed outside of it's Bollinger Band today. Will this signal fail again? Let's keep an eye on that hanging man candlestick.

EOD Update

It should be obvious that the red count is now the primary at the moment. Based on my 15 min chart below, it is very possible wave iii of this ED is complete.

The alternate here is that wave ii may still be in progress as a very large expanded flat.

Red Count2

15 Min

Below, is an attempt at counting an impulse wave down starting from 9/27. If this is correct, see the very bearish count below it.

5 min

A Pretty Bearish Count

Weekend Thoughts [11:48 AM Update]

[11:48 AM Update]

I realize I didn't clean up this count in the Fri's EOD Update. This better represents what I'm thinking for this count.

For those who own  a copy of the "Elliott Wave Principle", Frost and Prechter, 10th Ed,  figure 3-12 on page 124, best represents this count.

You can also view page 124 here at Google Books.

So based on this, one more bounce is in store for wave (e), which at the moment would equal 1168 if it chooses to rally to the top of the trendline. Keep in mind though that wave Es in triangles do not necessarily have to tag the trendline.

Blue2 Count Updated

Weekend Thoughts 

Frequent readers of this blog should know by now that I consider the longer term counts more of an academic pursuit rather than a practical tool for the purposes of trading. However, if I had to choose, the Long Term Cycle chart below is considered my primary count for the long term which I have been tracking for some time now. .

Long Term Cycle

Notice at this much higher degree of the count there are still several possibilities and it will take years to rule them out. On a more bearish note, the monthly MACD closed with a sell signal last week and was completely rejected by the longer term trendline. This may be hinting that a move back to the lower purple trendline is in store.

For the moment, I have considered Cycle X of Grand Super Cycle 4 complete and Cycle Y has been in progress since the 5/2011.

Cycle Y may take on 2 patterns. Either a zigzag down to the blue trendline near 840 or it forms a large triangle that may take the next 7-8 years to form.

Guess what, this may be one exception to the academic pursuit of this longer term study. Should, and I stress should Cycle Y form a triangle, this may be the only useful count for longer term investors over the next 7-8 years. The green converging trendlines may serve as a guideline when to stay safe in cash (which would be now) and put money back to work.

Should one choose to take on a little more risk, investing the A-B-C subwaves of the triangle may also be a strategy. **This is not a recommendation but only an opinion should a triangle be playing out. 

Now for the alternates on the above:

It is possible only Primary wave W of Cycle X completed at the 5/2011 high and now Primary wave X of Cycle X back to the 1010 low.

5 Year

Here's a closer look at the Long Term Count above and what I have been tracking over the past several weeks. I have posted this chart more frequently and updated the labels a bit to match the much longer term count above.

Weekly

I'm still watching for a possible repeat of 2004.

Daily - 'W' Bottom

Shorter term I'll be watching for a potential 'W' bottom set up again on the daily chart. If a move below 1114 occurs over the next several days while maintaining above the lower band, step 3 may be considered in place.

Long Term Channels

Let's see if the market finds some support at the intersecting channels near term.

Long Term Channel Closeup

A weekly inverted hammer candle may be setting the market up for a reversal. Let's wait for a weekly confirmation via a gap up or long white candlestick next week.

HG - 5 year

Copper futures looks fairly consistent with the SPX 5 year chart above. This counts pretty clean so we should watch this since it is accepted that copper typically leads the market.

I have the pullback either complete as a wxy at the 50% retracement level. However, the initial degree wxy may represent a larger degree wave W. In any event, this would still imply a rally back to 50% retracement in a larger degree wave X. The 50% retracement target would be approximate 3.85.http://books.google.com/books?id=0fA-ItDgSQkC&lpg=PP1&dq=elliott%20wave%20principle%20key%20to%20market%20behavior&pg=PA124#v=onepage&q&f=true