I'm not too interested in reading the internals today since it was an options expiration day which can skew these numbers a bit. However, considering the fact that there's usually heavy volume on option expiration day, the fact that there were only 1.5 billion shares traded lends itself to a Minor wave 5 outlook that is finishing up most likely.
And make sure you keep the bigger picture in mind and what it might mean for your long term portfolio:
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The more conservative way of counting the subwaves of Minor wave 5 is above. I have 5 Minute waves almost complete which will wrap up Minor wave 5 very soon in the process. I know that these waves are small for Minute waves relative to the prior Minute waves in this decline, but 5th waves often unfold imperfectly from what I've seen, so I'm planning for the most conservative scenario, which is above.
I've removed most of my short positions to reduce risk. The market has moved in my favor big enough and fast enough to warrant some profit taking at these levels. Sure, Minor wave 5 can turn into an extended 5th wave and cascade downward to significantly lower levels. But at this point that would just be a guess since there's no evidence to support that here, and the risk of a very large Intermediate wave (2) starting at any moment is great. So the risk/reward for the bears here is not appealing to me. So I took profits today.
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The euro arguably completed a 5 waves down with a sharp corrective rally today. I didn't label the chart because I don't want it to be misinterpreted that I actually buy into the view that this proposed 5 wave decline is the start of a new downtrend, because I don't. The daily chart of the euro shows what is clearly a corrective downward move by EWP standards, meaning the next big move is up. Aside from the series of lower highs in place that keep me from getting long for now, the euro does look overall bullish to me here. Stocks have sold off drastically the past few weeks yet the euro has held firmly still, partly because gold has been in a blowoff top - or vice versa. So I don't see how the euro will all of a sudden tumble at the tail end of Intermediate wave (1) in stocks. Most likely the euro is waiting for Intermediate wave (2) in stocks for it to start declining, or it's going to rally with stocks' Intermediate wave (2), then decline hard with stocks' Intermediate wave (3). There are too many "ifs" and question marks here for me. So I'm standing aside for now.
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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.