So Scottrade modernized their data and charts so we have to adjust and get used to this new style here for the internals. Volume was fairly light today on the NYSE with just over 1 billion shares traded, but what’s really of note here is the large amount of up volume compared to down volume along with the solid amount of advancers to decliners. The Nasdaqs and small cap indices made some real nice gains today after slacking a bit yesterday, suggesting this market isn’t quite done running higher for the moment. I expect more floating to the upside in the short term.
Nothing’s really changed from yesterday in the wave count or momentum picture. As of right now, the RSI is diverging from the newest highs in price on the S&P. This is typical 5th wave behavior, so the count I have labeled remains likely, at least at the Minute degree. I see no signs of a reversal or top here, in fact it appears we still need some sideways or mild declining before we get at least one more last small surge to new highs to complete the smaller degree wave pattern. So a float higher in the short term still seems to be the likely scenario from here.
The XLF has been making strong gains the past few weeks, along with stocks. But it still remains shy of its April 2010 high while the stock market has well exceed that high. So a slight divergence is in play here. A turn lower in the stock market real soon would confirm this divergence and suggest a larger decline was underway, perhaps the 100 point S&P decline I mentioned yesterday.
So for stocks, I’m still waiting. I don’t see a desirable risk/reward ratio on the bullish side right now, yet I see no signs of a top and reversal for the bears either. So I have to just sit and wait patiently for an opportunity to present itself. And I’m looking mainly for shorting opportunities at the moment.
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The euro declined nicely as I thought it would after seeing that daily reversal candle yesterday. The wave count from the Primary wave C high is still unclear but there is no reason to abandon the bearish view right now in my opinion. Rallies have a tough time sustaining themselves, and the euro is trading very heavy overall. I remain cautiously bearish the euro and bullish the US dollar. A break below 1.2968 EUR/USD will open the door for a test of 1.2600 soon after.
December 30, 2010
Prechter on CNBC - "Not a bear among them"
Robert Prechter of Elliott Wave International and Don Luskin of Trend Macro share their opposing market views with CNBC host Larry Kudlow. (Note: Prechter's interview starts about four minutes into the interview). Get Up to Speed on Robert Prechter's Latest Perspective — Download this Special FREE Report Now.
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
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