Sunday, March 14, 2010

Friday 3/12/10 Market Update

The ~1053 triangle target discussed Thursday was reached Friday morning. Prices reversed almost exactly on that mark following an extended 5th wave that began Thursday near the close; see the 1 minute chart above. It is possible that the impulse following the triangle is not yet complete as the alternate above suggests.

Because prices are so close to the lower channel line apparent since 2/25 (see above) and the S&P futures market is currently trading lower, the degrees of some of the waves have been updated to a likely option presented earlier this week. It is still possible that this line is broken in a continuing wave iv preceding wave v. Breaking below 1042 is a sign that wave (iv) is underway although this is not a rule.

It still appears that an impulse since 2/5 is unfolding. See the chart above. After spending several hours this weekend reviewing the price patterns since 2/5, the two charts above still present the best options, at least in my opinion. Note that 5 waves up can be identified and labeled as an impulse (the alternate count). If this is correct, expect a dramatic reversal this week. Extended 5th waves are retraced quickly.

The larger count has changed, see the new labellings above. This was found after a moment of enlightenment on Thursday evening around 1am. All the waves that look like 3s are labeled as 3s. Likewise, all the waves that look like 5s are labeled as 5s. There is also decent proportionality between the waves. X of (XX) is quite high, but (X) and (XX) look dis-similar as they should. Each zigzag pairing also has its own personality.

Wave [3] will likely be underway when the lower channel line is breached. This may happen sooner than later if the previous count of this degree suggested is correct. Wave (X) is a bit small however so it is not as desirable. For now, it looks like a final zigzag higher that began 2/5 should take S&P 500 prices beyond 1200, perhaps near 1230 to achieve 61.8% retracement of primary wave [1].

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