Friday 4/4/14 Market Update

There is no change to the wave count options in the long-term.  A impulse wave [5] underway since the 2/5/14 low seems difficult to imagine from a momentum perspective during this late stage of an impulse wave that began in 2011.

The action higher following the 2/5 low still resembles a 3-wave advance.  The sell-off following Friday's high was exactly what the wave count has been suggesting would happen with the short-term count proving to be exactly true.  This move improves the probability of the primary wave count of a complete zigzag higher since 2/5 and it will continue to strengthen as prices move lower.  While things are moving as expected, it is important to note that alternate' is still the best alternate count and not a poor option.

The action on Friday was a bit strange, but the wave down can be counted as an impulse wave, barely.  This wave can also be a double zigzag down (which might be used if alternate' is correct).

There was some momentum loss lower late in the day with a relatively large rally following what proved to be the day's low.  This is a signal that the wave down is complete and a corrective rally is beginning.

Wednesday 4/2/14 Market Update

In the long-term, the options remain unchanged from the last update.

The market has broken out to new all-time highs, rather than pulling back at 1885, which is a signal that the long, wide correction lasting weeks has ended.  Because of this development and the complexity required for a correction to still be underway, alternate'' is not a strong option.

The very shallow correction seen since Feburary can be a second wave, but a sideways correction like this is not typical of second waves.  The market will need to put on an amazing show of strength over the next few weeks if a third wave is underway, particularity because the bull market is so mature.

The problems with the alternate counts above make the primary wave count stand out by a good margin.

There are many ways to describe the movement higher since 3/27, but the best symmetry to the move so far is as labeled above.

Note: There is a jobs report at 8:30am EST on Friday.  These create volatility and can be catalysts for large moves.

Friday 3/28/14 Market Update

The market still appears to be drawing out an impulse wave higher since the 2011 low.  It should be at least a couple of months until completes.

There is clearly so far only a 3-wave advance higher since 2/5.  There is a very high probability of new all-time highs coming in the near future with the structure over the last month suggesting this will will be seen within the next few weeks.  A breakout is expected after a triangle X wave (primary) or flat X wave (alternate'') completes.  These are both good options with a more complex X wave underway also possible as a reasonable option.  The breakout will probably only be brief as a double zigzag higher since 2/5 seems to be developing.

An impulsive option is possible (alternate'), but its second wave correction seems a bit strange.  A complete double zigzag since 2/5 is also possible and perhaps better (alternate'' 3), but the 'b' waves between its zigzag legs seem out of proportion.  Even if this option is correct, there is still most likely a wave [4] sideways correction underway since the January high which is a bullish wave structure.

The bounce following either of the Thursday lows is best counted as a zigzag.  So if one of the upper resistance levels in the 1-minute chart above is tested, a deep pullback should ensue.  If prices move under the ~1835 support level this week, alternate'' 3 will become the best option.