I just wanted to report that I'm starting to lean more towards the alternate count I put up in the last post. The market is bouncing as I expected but my top count from last post suggests a major bottom of Intermediate wave (1) which means Intermediate wave (2) up would theoretically be underway now. There are two major problems with thinking Intermediate wave (2) up has started though:
1) most major indices/sectors have not made new lows beneath their Minor wave 3 extremes; and
2) the bottom and rally has been anemic in price action and internals. I would expect a more violent move off the lows, or a much larger and internally stronger push higher to kickoff such a large wave that Intermediate wave (2) would be.
I don't see those two things here which tell me that most likely my alternate count is in play (see above chart). This means that this current bounce is simply a Minute wave ((ii)), and when it ends, Minute wave ((iii)) down within Minor wave 5 will be underway. This will be a pretty strong move to the downside that should have no problem taking most, or all, of the major indices/sectors to new lows. So, as long as the S&P cash index stays below the Minor wave 4 high at 1208.47, this market is still bearish in my view.
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The euro is still a mess and no wave count can be determined here with high confidence, so I'm not going to "guess" and put one up. It looks clearly corrective to me here which suggests a new high for the year is on the way. But the recent move higher so far is also a choppy mess, suggesting we may have a sharp decline first. Too many "ifs" and "buts" for this one so I'll avoid it for now.
My opinion is that the euro is experiencing a push/pull affect. One example is that behavior in gold relative to the stock market. Gold has been soaring to new all time highs and seems hell bent on getting to the $2,000 mark before exhausting. But stocks have been plummeting during this time. This push/pull of related forces on the euro has helped create the choppy price action you can see in the chart above. I'm not sure how this will resolve though since when gold finally tops and reverses down, stocks should be headed up. So which way will the euro go when that happens? I have no idea, and since I usually depend on the EWP count for direction, I'm stumped. I'm staying away.
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.