Wednesday, June 16, 2010

Wednesday 6/16/10 Market Update

The count has not changed since yesterday's update. Although the waves were very unclear today, a wave v of (v) completion to wrap up impulse wave [c] of flat wave 2 is the best guess. A move beneath wave [c]'s Elliott channel seems to be near. The more wave crossing that occurs, the more likely it is that a new decline is underway.

A set of choppy zigzag waves appear to have unfolded completing a triangle or ending diagonal. The latter option works best when considering the nearby wave proportionality and form (i.e. wave ii compared to the very wide suggested triangle wave iv, and the first few waves before the sell-off). An ending diagonal wave v works well from a Fibonacci perspective when compared in price to wave i. Its sub-waves also make sense in the context of the pattern although there is probably not much wedging.

The 1120 level was nearly reached today and prices did break down following this. This is not a surprise. What will be surprising is a continuation beyond today's highs, even if slightly, because it is very difficult to justify this move in the content of the short term count; the rally since 6/8 has been charted here. If 1120 is broken however, this does not necessarily invalidate the larger count.

Wave 2 has now retraced between 50% and 61.8% of 1. This is a perfect retracement level for a second wave.

The larger view has not changed. Wave 3 should take prices into the June 2009 resistance zone.

Volume continues to be quite low as seen here.

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