With today's rally to a new swing high, the decline from last Thursday's high (as shown here in the Dow) is a 3 wave move. This means it's just a correction and suggests the market will charge higher in the coming days/weeks.
Not only is the decline in 3 waves, but the rally we're seeing now looks impulsive. So the EWP evidence is strong that the market will continue charging to new highs in the coming days/weeks and at least attempt to enter my 1173-1181 reversal zone I've mentioned in the past.
One thing to note is that this big rally is supposedly in reaction to the Bank of Japan lowering interest rates to zero, and some other positive US data. The move by the BoJ is more important to me. These rallies from government intervention are often short lived and completely reversed. So the action may have thrown a wrench into the wave count and make it difficult for wavers to get on board the short side. Just like I want to see follow-through for the bears on the short side, I also want to see it on the bull side on rallies. So tomorrow and Thursday will be more important than what happens today.
The euro made a nice 5 wave decline last night that I eluded to in yesterday's post. But the start of that 5 wave decline was exceeded early this morning so that count is invalidated. When the euro turns, so should stocks.
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:
Well it seems like what's happening a lot in this country, those who are foolish get the government bailouts who essentially use the money they received from the folks who did the right thing and played by the rules. Oh well.
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