Wednesday, June 30, 2010

S&P 500 ~ Elliott Wave Count 30 June 2010

Another tiny second wave? Seems so!

As I posted during the day I expected a rally to the 1060's today. When we completed a first a b c around midday I thought that was only wave w of a double zigzag second wave. We then declined in another a b c move to 1040 into the afternoon so I hoped for a late day rally.

But that did not happen. In the last trading hour the SPX broke 1040 and sold off to 1028! So I think wave (ii) already ended at 1048 and the big one is upon us. If you see other short term counts feel free to post them!

I'm really excited about tomorrow : )

Edit: Fractal Update: We should have seen a rally today from 1033 to 1068 according to the fractal. Either the rally was shorter than in 1987 OR the fractal is one day off and today was the low (1028 isn't that far away from 1033) and tomorrow will be the big rally. We will see.

Intraday Update 30 June 2010

Just a short fractal update:

I calculated the levels for day 34 (yesterday) low and day 35 high.

The level for the low is SPX 1033 (pretty much reached yesterday) and the high is SPX 1068 for today.

So far the SPX has reached only 1047 so we may rally a bit more today. But if the fractal is correct the crash should start tomorrow, so going long now is probably quite risky ; )

Tuesday, June 29, 2010

S&P 500 ~ Elliott Wave Count 29 June 2010

Wow! What a day.

Yesterday's sideways action was indeed the whole second wave:

Today's low was possibly the end of wave (i) and now we could get a wave (ii) rally. A rally tomorrow matches also my fractal (see earlier post today) and it's also the last day of the quarter aka window dressing.

Optical Illusions

For those that watched England-Germany.. : ))

SPX below 1040 by the way!

S&P 500 ~ Fractal 29 June 2010

I posted this fractal on Monday after the SPX almost hit my target of 1133. This is now an updated chart:

In 87 the double bottom got retested on the 34th day. On the 35th day we got a big one day rally.

Today is the 34th day and we also got that test of 1040. So, tomorrow we may get a rally before the big plunge.

If the fractal continues to correlate we should crash very soon. Just in case if this really happens I calculated the target for the crash using the same method as I calculated the 1133 rally target.

The result I got is even lower than all perma-bears together can dream of I think LOL

It's 622...

If we go that low within two weeks praise me if not forget what you've just read lol

Monday, June 28, 2010

S&P 500 ~ Elliott Wave Count 28 June 2010

Bad news: The SPX was stuck in a triangle all day long

Good news: Tomorrow we should get a breakout either way.

The triangle is either a part of wave (ii) (b or x), thus c of y of (ii) would follow tomorrow or it was the whole wave (ii). Yes, I know that triangles in the second wave position are very rare but didn't we have a second wave triangle just last Tuesday? Well, it was labeled differently afterwards but if we had expected a fourth and not a second wave everybody would have labeled it as a triangle...

So, if today's action proves to be a second wave I'm sure there will be a way to label it not as a triangle... ; )

The wave count hasn't changed. Already in (iii) or still in (ii) with the bullish options still valid.

A short note to the bearish fractal:

As you can see if the correlation continues this fractal leads to a big crash. This week we should see some more or less flat or slightly down days and then decline below 1040 end of week. The crash should occur early July (6th/7th?). So let's see how this unfolds this week.

S&P 500 ~ Elliott Wave Count 25 June 2010

May be I was right in the first place when I posted the following short term count that wave (i) ended at 1075.

Instead of the expected zigzag so far we got a flat. But since it didn't even retrace 38 % of wave (i) this was possibly only a part of wave (ii).

The bullish alternative is still possible though. So far, we just got a backtest of the broken downtrend line.

Also the two fractals I posted are both still valid:

I posted the fractal above one week ago and so far it keeps correlating with today.
=> We should decline below 1040 this week.

And the bullish fractal:

Thursday, June 24, 2010

S&P 500 ~ Elliott Wave Count 25 June 2010

Already the pre-market action indicated that we would see a new low today. When the unemployment claims beat the estimates the market started to rally though. But this lasted only for a few minutes until people realized that the numbers were actually just less worse than expected...

So, the SPX continued to decline and hit 1075 in the morning where it seemed to bottom out. A very nice impulse from 1131 was formed so I thought this could be a completed wave (i).

Just a few hours later the market proved me wrong though when it sold off below 1075.

The problem now is how to count the move from 1131? So far, I can count seven waves, i. e. corrective. Thus, it's possible that wave [b]/[ii] finished today.

But it's also very possible that the motive wave started on Monday is still underway. The possibilities are that we've seen either a series of 1-2's or that we'll get an extended fifth wave.

S&P 500 ~ Intraday Update 24 June 2010

We got a new low today thus the decline from 1131 can be counted as an impulse now. It seems that we are in the last waves of wave (i). A rally above 1085 should confirm that wave (ii) is underway with a target of 1100-1110.

Wednesday, June 23, 2010

S&P 500 ~ Elliott Wave Count 23 June 2010

The SPX declined a bit more today and reached the 1090 level where it found support. From the 1131 top I can count three waves to 1085, thus so far it's corrective. At 1087 is also the 50 % retracement level, a common target for b and second waves. A rally above 1115 should clear the way for at least 1150 or even 1220+ in the very bullish count.

For the bearish count we need one more new low tomorrow possibly around 1075 to complete wave (i) down from 1131.

Tuesday, June 22, 2010

S&P 500 ~ Elliott Wave Count 22 June 2010

The SPX was flat for most of the day until it broke out of a triangle in the afternoon. 1105 didn't hold and the market sold off into the close to end the day near the LOD at 1095.

The market continues its correction as expected. This is either an abc correction to the 1090 level or even a bit lower until the next rally starts or this is the beginning of wave 3 down.

Monday, June 21, 2010

S&P 500 ~ Elliott Wave Count 21 June 2010

It's time to reveal the fractal:

SPX 1133 and Dow 10567 were the targets for this rally according to this fractal. These targets were almost reached today (actually exceeded in the Dow), thus IF today's highs hold we should decline from here:

All Elliott Wave counts are still possible:

If a [b] or [ii] wave is underway 1090ish is a possible target.

The February comparison I posted earlier today continues to correlate:

In February the tenth day from the low finished the initial rally and a one week pullback followed. Today is the tenth day and likely finished an impulse from the low. Thus, the current decline should be a correction and be finished on Friday this week.

Pre-Market Warm-Up 21 June 2010

The ES is up 15! handles currently trading at 1127.

There are still many possible EW counts and at this point I can't prefer one of these:

All have their pros and cons, two are bearish and two are bullish, so everything is even steven here.

We do have the possible H&S supporting the bearish counts but I still like the 2007 comparison supporting the bullish case.

I also like to compare it to February. In February, the initial rally from the lows lasted 10 days followed by a four day correction and then a two month rally. Today is the tenth day from the lows, thus we could see some type of correction the whole week between 1100 and 1130 and then start a summer rally which should last until the end of August.

I have more charts for you later but first I'm gonna watch a football match ; )

Friday, June 18, 2010

ES ~ Fractal 18 June 2010

Fat Finger II ?

Possible fractal for today/Monday IF the ES doesn't exceed 1117.5

Thursday, June 17, 2010

S&P 500 ~ Elliott Wave Count 17 June 2010

No reason to change the count after today's exciting action. We'll probably get a sideways b wave but I don't think that wave [b] is already completed. So, we may test the 1100 area again tomorrow.

I actually promised to post a fractal today but it's a medium term fractal and I'd like to post it when it gets interesting because we should see another two or three more or less flat days. So, if it continues to correlate I'll post it early next week.

Just spotted a short term fractal which I'm gonna definitely post tomorrow morning unless we'd already have exceeded ES 1117.5 by then.

Wednesday, June 16, 2010

S&P 500 ~ Elliott Wave Count 16 June 2010

Today, the SPX almost got to that 1120 level missing it by only 1 point. So, I think wave [a] finished at 1119. A typical b wave retracement is between the 23-38 % retracement level and the previous wave (iv) area. 1100 should also provide some support so I think 1090 to 1100 is the target area for wave [b].

If this level holds we should get a [c] wave to 1130-1170.

Alternative counts are shown in the chart:

Where are we in the big picture?

The most popular count, which I, to be honest, don't like at all, is that a multi decade bear market began in 2000 when we completed a (grand?) super cycle wave. The low in 2002/3 completed cycle wave a, the top in 07 a cycle wave b of an expanded flat and cycle wave c now underway subdividing into five Primary waves. Primary [1] finished at 666 and Primary [2] possibly finished at 1220.

I also added a Primary [A] [B] [C] count because I actually think that this super cycle wave finished at the 07 top. The reason I label it like that is because the European indices clearly made a five wave impulse from their 03 low to the 07 top. Well, the US and the EU counts don't have to concur but I think it's likely that both have the same count.

Below an exotic long term count I think ; )

So, if we exceed 1220 we could rally to 1600(!) and then crash to 500 completing an Expanding Triangle. It's the same pattern we saw in the 70's:

Ok, gotta get some sleep now... I have a fractal for you tomorrow morning but for now that's it ; )

Switzerland 1 - Spain 0

I'll post an update in about one hour. I'm in the perfect mood right now to write a big fat update so I'll post some long term and other charts as well lol : )

S&P 500 ~ Elliott Wave Count 15 June 2010

The SPX finally broke out of the trading range between 1040 and 1105 and closed at 1115. A backtest of 1105ish would be nice followed by another rally to 1150.

I don't know how you're feeling but this feels like Feb 2010, doesn't it?

First, most had the 1-2-1-2-1-2 count which got changed to a 1-2-1-2 count later and then to a 1-2 count. Then, in late February the market declined a bit and it felt like the confirmation of wave 3 down. As we know now this was only a correction and the market rallied another 130 points before it topped.

Thus, the next decline should help to determine whether we go down or up in June and July. A three wave move down would be bullish while a five wave impulse down would be bearish.

Preferred EW count is that we're in a wave [a] which should top around 1120 followed by a wave [b] to 1100 and then a wave [c] to 1150-75. Anything below 1040 is bearish and would confirm that wave 3 is underway.

Monday, June 14, 2010

S&P 500 ~ Elliott Wave Count 14 June 2010

At least fractals work if you can't use Elliott Waves : )

And updated:

As I posted before the open I thought that a diagonal was forming. Whether an Ending Diagonal or a Leading Diagonal we don't know yet. If it's an LD we should retrace to ES 1070 +/- 10 and then continue to rally. But if it's an ED we've seen the high for the next few months today and should decline from here. Confirmation that a third wave is underway below 1040ish.

So, nothing changed, 1040 and 1105 are still the levels to break.

S&P 500 ~ Fractal 14 June 2010

Possible fractal for today:

ES ~ Elliott Wave Count 11 June 2010

Sorry for the late update. The World Cup began so I had to watch the matches. ; )

On Friday we got the expected decline. Well, the market closed up but was down for most of the day.

The situation hasn't changed at all since last week. We're still in this 65 point range between 1040 and 1105. It's been a mess to count the moves in the past three weeks. There are many possibilities: a completed a b c at 1040 and new highs in a few weeks time? wave [ii] finishes today or tomorrow and we'll decline below 1040 very soon? wave 1 ended at 1040 and we'll rally to 1150 first and then decline below 1040?

These are just a few possibilities, so, imo, the best thing is to trade a convincing break of either 1040 or 1105.

Thursday, June 10, 2010

S&P 500 ~ Elliott Wave Count 10 June

Oops! They did it again:

Yesterday's late day sell off got completely erased overnight and the market opened with a big gap up. We went sideways then for quite some time and afterwards rallied into the close.

This is very similar to what we saw about two weeks ago. The day after we closed slightly lower so that's what we possibly can expect of tomorrow. May be down to today's low to test it again?

The short term wave counts remains unclear. I labeled today's high as wave (ii) since wave w equals wave y. I'm still waiting for a break out of the trading range we've been in for three weeks now.

Wednesday, June 9, 2010

S&P 500 ~ Elliott Wave Count 9 June 2010

The SPX tried to break the strong resistance in the 1070's but the EUR/JPY never confirmed this rally as it couldn't breach the 110 resistance.

I labeled today's high as wave (ii) of [iii] even though we need a break of 1040 to get the confirmation for that. If we break that level I think we'll quickly sell off to the 1020's or even lower to 1000ish, get a backtest of 1040 and then begin the third of a third next week.

grrrrrr! I shouldn't have discarded the fractal I posted yesterday so fast:

We got a move to 1070-80...:

If this continues to correlate we should see a decline to the 1020's followed by a rally to 1040 and then another sell off much lower.

Intraday Update 9 June 2010

Pre-Market Warm-Up 9 June 2010

Pre-market the ES has entered the 1070 resistance area and has been moving sideways in the past hour. Also the EUR/JPY is at a strong resistance at 110. A convincing break of these levels could lead to a nice rally today.

Elliott Wave Count 8 June 2010

Yesterday our national bank (the SNB, Swiss National Bank) decided once again to buy some EUR and sell CHF. That resulted in a big spike in the EUR/CHF:

With all these euros the SNB has bought over the past months I think we could buy some of the bankrupt EU countries very soon LOL

The SPX bottomed shortly after this spike near the May lows at 1042 and finished the day 20 handles higher at 1062.

I label the low today as wave (i) of [iii] and (ii) now underway. A likely target is the ES 1070 area. There is the low of wave (x) of [ii] and the high of wave iv of (i) of [iii]. If the ES declines below 1040 wave (iii) of [iii] is very likely underway.

update coming soon....

sorry guys for the late update. I'll post one in about one or two hours.

Tuesday, June 8, 2010

S&P 500 ~ Intraday Update 8 June 2010

What a boring day...

May be we get some action into the close...

The condition for a rally to 1070-80 wasn't fulfilled by the way since the market didn't rally right after the open.

Pre-Market Warm-Up 8 June 2010

Overnight the ES rallied to 1060 first and then sold off to 1045. Right now we're trading at 1052, a few handles above yesterday's close.

The ES is either in a diagonal or made a series of 1-2s. Waiting for a break either way.

And a fractal for the SPX with a target of 1070-80 if we begin to rally shortly after the open:

Monday, June 7, 2010

ES ~ Elliott Wave Count 7 June 2010

Early afternoon the bulls tried to break 1070ish again but failed miserably. When 1058 was breached selling accelerated and did not stop until we hit the overnight lows at 1052ish. A tiny bounce was all the bulls got, the market continued to sell off and closed at the lows of the day.

Next support is the May low which may get tested overnight and then if that's breached we could sell off to 1020 or even to 1000.

It's quite hard to label the short term waves but the downmove to 1052 was possibly wave i followed by a very short second wave and now wave iii is underway with a target of 990-1020.

ES ~ Intraday Update 7 June 2010

Overnight the ES declined to 1052. From there it rallied up to the 1070 resistance area and got rejected there. I labeled this as wave [A] of ii, it's possible though that this was the whole wave ii.

We haven't had any retrace in the SPX though so I think we have to rally a bit more first before the decline can continue.

Targets for wave [C] are 1070 and if that's breached we could go up to the 1085-90 area. If the ES breaks below 1058 again we should test the overnight lows at 1052 and then the May lows.

Sunday, June 6, 2010

Elliott Wave Count 6 June 2010

What one single day can change! As bullish as everybody was on Thursday as bearish is everybody now...

As we know Mondays are usually bullish so we may see some bounce early Monday to 1080 or even to 1090:

It's quite hard to count the squiggles, so the wave i labeling at Friday's low is just assuming that we get the usual Monday ramp.

I'm sure many of you have already compared today with the crash in 08. I did that about two weeks ago and since it keeps correlating I'm gonna post this fractal now:

Now and two years ago the first decline (f1) was followed by a huge (bailout) rally (f2) which did not exceed the previous high. Surprisingly (NOT), the problem wasn't solved with all that money so the sell off resumed and made a new low (f3) just a few days later. A last desperate attempt (f4) of the bulls to prevent the crash failed and so we plunged hundreds of points within just a few days.

In 08 the support line connecting the lows of the previous first waves was first breached late September. The market immediately bounced but breached it again a few days later. A backtest followed and then we crashed.
I also added the trendline connecting both second waves. It looks now like a Leading Diagonal, doesn't it?

Now compare it to today...

Huh? Right! The same LD and I bet that many will be counting it as an LD if we sell off to 1020 or even a bit lower to 1000 and then get a strong rally. If we then get another, unexpected for many, sell off below 1020 and backtest it a crash is very likely.

I'm not a fan of crash predictions but being careful these days could be the right thing to do.

The bigger picture looks as follows:

Assuming that Primary [C] has started Intermediate (1) should bottom near the 09 lows. Possible target for Primary [C] at 300 ([A]=[C]) and at 500 ([A]=[C] (in %)).

Interesting week ahead!

All the best to your trading,