Tuesday, November 10, 2009

Tuesday 11/10/09 Market Update

Above is a 1 minute chart of the S&P 500. Stocks closed nearly unchanged today but once again on low volume. Prices did move lower in the morning hours but in a corrective fashion. A rebound followed that appears to be the beginning of another gain that should be seen through at least part of tomorrow. So from a price standpoint, we are at a similar position as we were yesterday. But given the price action today, things are not looking bearish in the very short term.

Above is a daily chart of the S&P 500. If an expanding ending diagonal is unfolding, it is probably something similar to the one show. The best alternative I can think of is shown below but that implies considerably more time to complete [2] when it is already extended. It also has two rare running flats. So in my estimation, there will be one more high on the S&P 500 which will confirm the one on the Dow Jones Industrial Average. This should take a few more days to complete. Ending diagonals are 3-3-3-3-3 patterns, and an expanding diagonal should also be 3-3-3-3-3. This is a bit of a stretch for these upward waves, but a zigzag pattern up since 11/02/09 should be the pattern to look for. Of course this is far from clear.

Elliott Wave International published an interim short term update today, a followup to yesterdays update. FreeWeek is still underway so you can view these reports for free. They have a great price and time confluence chart of the Dow Jones Industrial Average that I would recommend checking out.

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