Sunday, January 16, 2011

Friday 1/14/11 Market Update

There is no change to the count since Thursday's update. Impulse wave (v) of [v] should be in its final stages. The count above is one interpretation of the short term action.

Following the completion of (v) and [v], which appear to be clear impulse waves, an impulse that began in late November as described above should also complete. Since wave [iii] is shorter than wave [i], wave [v] will likely not extend. If the rally continues into next week, a much larger impulse wave still forming is possible. From a technical perspective, this market is well due for a correction however.

Stepping back a bit, there was likely an impulse from late August to early November that should be a 3rd wave or an 'a' wave. Supporting the 'a' wave option, on a larger scale proportionality and alternation were discussed in Thursday's update using this chart.

Regardless of the larger count, there is a very good chance a series of impulse waves are ending, perhaps Tuesday morning (the next trading day). This confluence alone should lead to a multi-week correction of some sort.

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