Stocks tanked today and the internals suggest it was broad based and ugly. The bears were in full control today and the bulls didn't even really attempt to enter this market after this morning's mild push higher failed miserably. News headlines suggest Libya's unrest is the cause for stocks falling but as extreme and overbought this market has been the past few weeks, it could have been knocked over by Paris Hilton announcing a new BFF.
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The count from the high is ugly if it's an impulsive decline, but imperfection this early in a trend change is not unusual. I'm unsure where Submicro wave (5) should be placed, but at this point any meaningful rally would get me on the short side with a stop above last week's high. Sure this could be another fakeout, we've seen plenty, but the risk/reward here is way too desirable. Whether it's Primary wave ((3)), or just a correction in a bull market, an S&P move of 100-150 points lower is likely in my view once we can confirm a top is in fact in. So whether it's Primary ((3)) or not, there's money to be made on the short side. A close beneath 1275.10 would confirm that a top is in.
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My forex software is not cooperating with me today but nothing has really changed from yesterday's post. Things looked good for the bears last night but this morning we saw most of those bearish gains taken back by the bulls. The wave structure is unclear but with the long term trend still down, I favor the short side as long as it trades beneath 1.3743.
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.