Education
I admit that today’s strong market internals put the Bearish Count into question. On the NYSE,
Advancers/Decliners = 6.59 / 1 and UpVolume/DownVolume = 12.75 / 1
Who said this market would be easy? It felt like there was lots of short covering today, which might have been needed to alleviate some of the bearish sentiment. Here is what Bears are looking for on this 10-minute chart of the SPX. There are few catalysts next week until the Friday employment report, so a choppy triangle next week does make sense. Today’s rally makes a nice 3-wave pattern, which suits the a-wave of a triangle.
EWT Lesson: Today’s rally looks like a bearish wedge but those can only be found in fifth or C waves. It is not the c-wave of a flat because subminuette ii is already a flat, and you cannot have two flats in the same 5-wave pattern. Subminuette ii must be a flat for this bear count to work. Otherwise, subminuette iv would violate the price territory of subminuette i.
Notes
This is a rough road map for the market movement I expect based on the rules of Elliot Wave Theory (EWT). There may be several valid counts at any given time, but I am only presenting what I consider the most likely count based on my own objective analysis.
SPX Preferred Count
My preferred count continues to play out. I wouldn’t expect any meaningful bounce until we pass the Minor 1 low around 1010, but the large Head & Shoulders Neckline is a more likely target around 995. There are alternates, of course, but today’s gap lower looks like the 3rd of a 3rd. If the gap fills, it would put the preferred count in question. 3rd of 3rd waves generally create a price window that is not retraced until the next wave of higher degree, which would be Minute [ii] in this case.
Author Notes
- This is a rough road map for the market movement I expect based on the rules of Elliot Wave Theory (EWT).
- There may be several valid counts at any given time, but I am only presenting what I consider the most likely count based on my own objective analysis.
Where is everyone? Even the Yahoos don’t visit anymore… might be a contrarian indicator.
Remember our old friend Teddy? The TED spread (defined below) has been under 40 for the past 11 months, but today it reached its highest level since July 2009: 39.02 basis points
TED 3-year Chart
Lots of interesting things happening here. The market had the opportunity to form a triple zig-zag, and the Fibonacci Time Ratio was setting up perfectly as well. It’s failure is a sign of weakness. Minute [ii] has already lasted long enough in terms of time and has retraced 50% of [1] in classic ZZ fashion. The last half hour certainly felt and looked impulsive, but it does take some creativity to label a leading diagonal offthe high.
After a long hiatus, I’m back with another video, perhaps just in time for a 3rd of a 3rd of a 3rd wave down in the major indexes!
[youtube width="640" height="385"]http://www.youtube.com/watch?v=ysIGJ8beI10[/youtube]
We took a look at Gold on April 26th when it closed at $1,157. We’ve had a breakout and closed today at $1,165, the high was $1.175. Not bad for a start. Now let’s look at Spot Silver:
There are a couple of things I want you to notice. XAGUSDO is a weekly chart that goes back to the low in 2008. Notice the huge triangle I’ve drawn in. The target on a breakout is $30 an ounce on Silver. The Trade Triangles has us on a monthly sell in January, but a close this month over $18.45 would change that to a buy. The weekly is on a buy and the daily will shift to a buy shortly.
I believe the physical is in short supply and two big banks are massively short the metal. Fireworks could be just ahead.
Full disclosure: I own shares in GDXJ and GRS and the precious metals.
Two days before Christmas, Geely announced it had settled commercial terms with Ford on the acquisition of Volvo cars. It is only now, however, that the two sides actually have a deal. The Hangzhou-based manufacturer will not get its hands on the assets until the third quarter, two years after registering interest.
The crude oil market came under pressure on Monday. This oil market video was created on Sunday by Adam Hewison. Nonetheless, I think you will find it useful as it outlines his position in this market based on Market Club technology.
The video is short and to the point, nonetheless I think you’ll have a lot of good takeaway information. As always the video is free to watch and there are no registration requirements.
I would really like to hear back from you with regards to your thoughts on this video. All the best,
Hello, My name is Idan Koren I blog at www.stocktock.com, I have been trading the markets since April of 2000, and have acquired a lot of experience trading using technical analysis and market sentiment. Due to the high level of request, I have decided to tape a compilation of a videos to help new traders learn how to trade and not make mistakes. In this video I talk about drawing resistance and support trend-lines. As well as some topping and bottoming patterns, channel formations and the wedge formation that we have been seeing on the S&P recently.
