Wednesday, October 7, 2009

Why 1120?

SPX: As I've already said yesterday, at 1121 lies the 50% retracement of Primary A/1. Moreover, A equals C at 1128 and the target of a possible H&S is at 1120ish (see chart below)

The only issue is, that an Expanding Ending Diagonal (p. 37 in our bible) is very very rare... Furthermore the upwaves ([i],[iii],[v]) are supposed to be zigzags, and it's quite hard to count them in that way.

A move above 1070 should confirm this scenario, whereas a drop below 1020 indicates that we might be in a very bearish 1-2-i-ii scenario.