Wednesday, February 24, 2010

Wednesday 2/24/10 Market Update

On low volume, prices rebounded in a choppy fashion retracing about 72% of the impulse lower that began 2/22. An impulsive count higher can be found but it is a bit doubtful. Because there has been no satisfying wave iv bottom if one did not occur yesterday and the push higher has been dominant in size, in my estimation wave v of (c) of [ii] is underway. This is not a much higher probability than a more bearish count however; both options are valid. The 1 minute chart above shows a few possibilities but highlights a possible impulsive count higher.

The labeled running flat wave [2] can be justified by the soaring rally that followed. That wave also looks like a 3rd and works well with this count. An impulsive wave count on the Dow Jones Industrial average is somewhat different as the 1 minute chart below shows.

The slide from the 2/19 peak does not look impulsive but the bounce on the Dow is also questionable. Perhaps wave iv is still underway although it would be quite wide.

Although there are impulsive labellings, the choppy waves today can easily be viewed as corrective. There are a variety of ways to label zigzag waves higher. The market has not delivered clear signals the past few days but the larger picture has remained the same. The intermediate term count can be seen in the below chart.

The longer term count can be seen here from yesterday's post.

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