Hope you all had a great Thanksgiving holiday like I did. I'm sure I've put on a couple thousand pounds this past week seeing as that I have to basically just "roll" myself around from point A to point B instead of walking. Apparently I'm not the only one, market participants must have also still been recovering from the Thanksgiving holiday today because volume was quite light as it was well under 1 billion shares traded on the NYSE. The market rallied back in the late day trading but the S&P decliners still closed quite heavy for the day. Looking at just internals and market behavior alone, this market looks weak and should continue lower beneath the support level of 1174 in the S&P this week. But looking at the wave count, it suggests just the opposite for the short term, and today's strength in financials MAY be a sign of a big rally tomorrow.
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If the stock market is in a Minute wave ((iv)) triangle then it is certainly testing our patience. A break below the Minuette wave (a) low today would have made the triangle very unlikely. But the decline today stopped just short of that level before mounting a nice rally into the close. According to the wave count I'm projecting, we should get a push up to the 1210-1220 area for Minuette wave (b) of the triangle. From there we'll get a modest decline for Minuette (c). A strong decline below the Minuette wave (a) low at 1173 would make the overall decline look more like a combination correction (WXY) than a triangle, and that we'll get more weakness into at least the 1150-1160 area quite soon. Only a decline below 1129.24 would remove the corrective decline scenarios from the table and suggest that something much bigger to the downside is occurring.
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The euro continues to fulfill the bearish forecast I've been mentioning here for a while now. The typical Thanksgiving weakness did not fail to disappoint this year as the euro has pretty much declined the entire week. I'm posting the daily chart above to keep focus on the bigger picture which has the euro setup for a Minor wave 3 down right now. If correct, the trend is firmly down and getting caught up in the short term fluctuations would be foolish in my view. The euro is heading lower and the dollar is heading higher. Only a break above the Minor wave 2 high at 1.3785 in the euro would sound the caution alarms for the bears.
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PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.