This is not the day the teddy bears have their picnic. Today’s NYSE a/d was 5.34/1 which is the strongest advance since July 15 2009, although on embarrassingly low volume.
My count for the Russell 2000 is already blown. I’ll do a new count for the SP500 over the weekend and the VIX count looks like it needs a complete refresh.
When it comes to Elliot Wave the Dow is still considered the master index, as it better reflects sentiment, so let us continue to look at the macro view that I have been publishing lately.
First the long term View
Long Term
Now the last few years
Then the last 60 days.
Notice how the Dow crossed the line today, the first time since Jan 19. This means that, for the bearish case to remain intact, the dow need to go down on Monday – back into the bear channel, and go down hard. Otherwise we could be looking at another uptrend.
[Update at 12.30pm - added the Long Term Industrial Chart at the end]
Okay if the dow goes much higher then it will jump out of my bear channel. If we are really in a bear market, with the rise from last march being a Bear Market Rally, then the market needs to start going down now. If it doesnt then i may have to buy some horns.
And a close up on the dow
As you can see, we hit the 78.6% retracement (from the Jan 19 decline) this morning.
And just in case you have not seen it before here is my Long term prediction.
[Update at 6.15pm - Added the primary channel, which we hit the underside of today.]
I take my dog for a walk every day. I tend to use the same route, going past Abercrombie and Fitch, The Gap, Brookstone, etc. In General they have been pretty empty for the past few months and always seem to have a sale on. This is why I am constantly amazed at the rise of the retailers stocks. Today the XRT (Retail Index) hit the 78.6% retracement of the 2007 to 2008 decline. Reality should come home to bite pretty soon. Chart below.
To get more info on this you should look over at this Slope of Hope Article.
Look at this pattern below and then superimpose it on the dow/ SP500 from Jan 19.
We have already hit D. If the pattern is true then we should be heading down tomorrow. This also fits in with my belief that traders are very complacent at the moment. CNBC spent the day saying that “If tom morrows unemployment numbers are bad, then it is priced in. If the number is good then the market should rally”. I think a rally is already priced in and selling will take place on the news- good or bad.
Here is the latest count. There is still a chance for an extension, upto 1,127, however there is no need for it. The market is so overbought right now that I am suprised that there are buyers at all. Of course the whole market could just be several HFT ‘puters trading with each other, with a couple of thousand momentum traders along for the ride – but what are the chances of that?. Anyways – the latest chart is:
The pattern is still valid. It looks like the market is waiting for tommorrow morning to make a move. If I am right then we should see it rocket higher in a fifth wave.
Well what a waste of a day. Tomorrow I am going to watch some paint dry and then prepare to watch some grass grow.
I thought I saw a pattern developing, with all the right technical queues, and then it gets severely challenged in the its-3.30pm-do-you-know-where-your-shorts-are daily ramp up. It will be interesting to see where we open tomorrow, though. Anyway to see a picture then look below.
We just had the retest of the trendline. Confirmation of the pattern will be a significant push thru the neckline.
Interesting little stock. An internet search engine in a country where they do not like you looking for too much truth. I think this stock is bashing against its ceiling.
[Update at 1.30pm after initial chart]
Price goes up, volume goes down.
[Update at 1.30pm Volume seem to have broken out from its contraction - lets see what happens now]
