Sunday, March 9, 2014

Friday 3/7/14 Market Update

An impulse higher since the 10/4/11 low still appears to be unfolding where new all-time highs in the months ahead are very likely.

So far there are only 3 waves higher from the February low.  This wave can be the first wave of an ending diagonal, a zigzag, or an impulse wave higher developing.  A more complex option is a double zigzag developing but nearly complete.  The important thing to note is that all options point to a continuation of the bull market in the months ahead.

An ending diagonal higher is possible, but this is not a pattern typically seen.  As discussed in the last update, a zigzag higher (or the more complex double zigzag option) works best with the technical picture of the market; the market would need to put on quite a demonstration of strength for the next month if an impulse higher is underway and not even half-way complete to regain the momentum that has been lost during the last few weeks.  The catalyst of the jobs report on Friday was a chance at regaining some momentum higher, but instead the market put in its 3rd consecutive indecisive trading day in a row with price again closing nearly unchanged.

In the short-term, no matter the wave count, the market correction looks incomplete since the last all-time high on Friday.  The reason is the low, sideways action that is the rebound from the day's low.  A weaker option is the complex flat+zigzag double since the Tuesday high.

blog comments powered by Disqus