Sunday, August 16, 2009

Friday 8/14/09 Market Update

The market continues trading sideways with low volume. The market is still in a corrective phase until proven otherwise.

A break above 1018 may occur but I would expect prices to turn lower shortly thereafter. The corrective pattern that is unfolding is still not certain, but a triangle or a flat are likely suspects for reasons discussed in previous posts.

Dan posted an alternative triangle count earlier but I do not believe this pattern is unfolding because it is not very satisfying. Consider the momentum on 7/30/09, it does not present itself as a 5th wave should, it works better as a 3rd wave. Following that is a very small 'a' wave then a huge 'b' wave with the resulting triangle correcting very little of the previous wave. For these reasons, I believe wave B is still underway.

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