The wave count for the short term I posted yesterday does not appear valid anymore due to the depth of the correction that continued into today. Right now I'm not sure what the short term count is, but it appears to be part of a 5th wave, or maybe a "b" wave within a 4th wave flat correction. There are two things of note that occurred today, and both have bearish implications. The first is that the Dow and Nasdaqs all made new highs today but the S&P did not. Oftentimes this divergence will occur right before larger turns in the market. So we'll see if this holds true with a sell off tomorrow. Second, despite the market closing up today, the VIX also closed up and above the lower bollinger band which gives us a nice sell signal. With options expiration this Friday, we could be in for a wild ride, and the evidence points to the ride being to the downside. The market seems poised to turn lower at any moment.
The EUR/USD has not closed the gap from Sunday yet so I'm still holding short that pair in anticipation that it will be filled soon, and perhaps continue lower from there with the stock market's decline.
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.
1 comment:
Todd, I believe you are right. Market will open higher tomorrow because of good reports from INTC and CSX. Selling in to the opening strength might pull the market down and believe the correction begins. Moola Reddy
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