Sunday, August 29, 2010

Friday 8/27/10 Market Update

A new impulsive labeling is suggested above. Because wave (i) is only slightly longer than [i], the above base channel's lower line was not breached Friday by (i), and prices have already retraced more than 38.2% of (i), the market may be winding up before a larger 3rd wave down within wave 3.

Note the zigzag-looking wave higher that appears to be nearly complete. The set of choppy waves following wave b with higher highs and higher lows looks like a completing ending diagonal. If there is an ending diagonal higher as marked, it is unlikely that a double zigzag higher is unfolding off the Friday low with a second zigzag to follow.

A zigzag as shown may be wave (ii) as suggested above, or wave a of triangle wave (iv). These are the two best options. A triangle is suggested because of the already near crossing of waves and substantial retracement of the last impulse as indicated in the first chart.

Prices should push lower in the following weeks and months.

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