Monday, July 6, 2009

Monday 7/6/09 1m Chart

The bounce is under way as expected. The market hit the strong support in 880s and the 200 day moving average with positive divergence on the 1m indicators as shown. Volume was higher than the previous two trading days but last week was a shortened holiday week.

A zigzag (w) wave appears to have been completed with another zigzag or other correction under way. (y) could be one of many patterns if [b] is a corrective 3 or it will be another zigzag (y) wave giving a double zigzag. This pattern does not look impulsive, it looks to be the [b] wave of W of the WXY double zigzag.

More than 23.6% of the [a] wave was retraced with 38.2% retracement around 904. The bounce has not entered the territory of what appears to be the 4th wave of [a] (see previous post from earlier today).

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