Monday, August 2, 2010

Monday 8/2/10 Market Update

The flat wave 2 count suggested in Friday's update has not changed. A continuation of today's rally should continue into the 1130s. The upper 1130s should stop the current rally if the count is correct. This is in line with the previous 1120-1140 target suggested earlier.

The gap higher and rally today are labeled best as a "3rd of a 3rd" wave of some degree. Given the expectation for an ending diagonal wave [c] of 2 in the larger context, the above labellings are the best estimate to describe recent market action.

A sideways correction of some kind should continue and will probably complete tomorrow. This correction will precede another move higher which will probably be wave [5] of a but may also be zigzag wave y of (v). The size of of the correction will help us determine to the correct count.

The larger view has not changed.

Wave (iv) labels provided in this chart yesterday were incorrect; the correct subminuette degree labellings are abc, not wxy.

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