The market closed higher again today but volume has been lower the past two days. The rally since 7/8/09 is getting long in the tooth and will be topping very soon completing wave [v] of A.
Although the top of [iii] is debatable, large triangle pattern was completed today. A triangle is also an indicator of the near end of the wave of next largest degree, wave A. This correction is likely wave [iv] because of its size. During this rally, there has been no correction this large.
Technical divergence on a variety of levels should be seen as wave [v] tops. This would be negative divergence on the RSI, MACD, ROC, etc. from the peak of [iii] to the peak of [v].
Some targets are shown on the above chart. The triangle apex is shown and can occur at a time of inflection in the market. Some Fibonacci targets are shown in blue (length of wave [i] extended from (e)) and pink (length of the widest part of the triangle [iv] wave from (e)). If these are passed, 161.8% targets are around 1004-1008 (not shown).
Problems:
Sill difficult to identify wave counts on the waves in the rally. But it does look impulsive with a gaping wave [iii]. There have been zigzag waves for some time now, these do not look impulsive but part of a triangle.
Alternatives:
Not a triangle but another correction or other waves forming.
This is the wave (iv) triangle, not wave [iv].
The triangle is not yet complete.
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