The alternate count is shown above. Although over the medium term this suggest higher levels, in the short term it implies the same thing as my preferred count; a sharp move lower real soon. Under this interpretation the market will drop sharply in a wave C while holding below yesterday's high.
I'd like to hear your feedback in the comments section or in my Elliott Wave Forum where I posted both charts. Thanks!
Seeing as the attitude lately is "risk on" because the Fed is the backstop for the markets, and today's big rally occurred even though consumer sentiment dipped much more than expected, you can download free booklet, "Understanding the Fed" in order to get a better perspective on the affects of the Federal Reserve's actions.
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.
5 comments:
The drop and climb up is too sharp. A waveform similar to 8/18-8/19/2010 would have suggested a 5 count. At the moment, it 'seems' NDX could (excluding bullish scenarios) sketch an ED, or some other concoction.
I see what you mean. An ending diagonal would be sweet since it's so clearly toppish and sets up a great shorting opportunity. I'll be watching for that. The Nasdaqs, and especially financials, have been showing relative weakness to the blue chips. We'll see if that continues, especially if it continues with an ending diagonal forming.
I think taken on its own your count is the highest probability from here. Equities looked like they wanted to fall today before the dollar collapse. A break of the daily low is a failed retest of the high and would set off a bearish chain reaction IMO. However, the converse is also true, a break of SPX 1150 and we should see some short covering at this point, and it will be difficult for equities to collapse until dx catches a bid, which is shows no sign at all of doing just yet.
The euro was strong most of the day despite the equity selloff. That was a good signal that equities would follow higher. The key appears to be the dollar bottoming, or the euro topping. I see no signs of euro top yet......but I'm watching carefully.
Hey Scott, I posted some of your original comments to the forum and you have a response already. I thought you might be interested in their comments:
http://elliott-wave-forum.967614.n3.nabble.com/Elliott-Wave-Principle-and-Technical-Analysis-Discussion-tp1569495p1599351.html
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