Tuesday, March 6, 2012
Today's Weakness is a Good Opportunity for the Bears; Euro Trend is Firmly Down
Today's reversal was decent from a bearish perspective since the decline is unfolding impulsively after the market internals and momentum are beyond stretched and tired. This suggests more downside is to come. Also, down volume was 95.7% of total volume on the NYSE today, so it was all selling all the way today. Looks like a lot of profit taking of people who have done well on the recent rally and want to reduce risk here at these levels. So all it takes today or tomorrow is a small fear jolt and this delicate market will crumble as those who didn't exit yet but are thinking about it, will rush for the exits and take profits at the next sign of trouble. Total volume increased by 25% today compared to yesterday, which is good for the bears, but overall it's still a very light number so let's not do a cartwheel just yet. I doubt a major top like the one labled in EWP below will occur this easily, so be prepared for some fakeouts and disappointments. Always manage risk assuming you're wrong whenever you place a trade.
Learn Elliott Wave Principle now while EWI is offering a free online edition of Bob Prechter's Elliott Wave Principle - Key to Market Behavior.
R.N. Elliott Discovered the Wave Principle Over 70 Years Ago
The euro followed the wave count I put up yesterday as it continued lower it what is probably a wave v within wave (iii). As long as the euro continues following the basis of this wave count I will continue to use it and trade with it. 3rd waves tend to do whatever they want, and they often extend, especially within their 5th wave which the euro is in right now. I'm holding short, expecting lower levels for the euro in the days ahead.
Who's Going to be President? Ask the Stock Market.
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.