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Wednesday, January 6, 2010

Wednesday updates

Click here for an updated look at the Fib fan chart, and please vote!!!
After the close, the trend is still up, with the SPX still making higher highs, but not with conviction. It traded in a very tight 6 point range today, ending right about in the middle. The minor counts are getting very close to having a full five waves up completed. And the indicators in almost every time range are diverging. Although the current trend is up, I am now going to a neutral stance and will start increasing my shorts in WWS. I am currently full short in RL.
Breadth for the day was only 1.50:1, a boring day it was.

9:12, After looking at the Renko chart below and all the other charts, I have settled on this as my perfered count for now. It is a count I have had, but was very uncomfortable with because wave 4 entered wave 1 at the close December 31st. But after looking at the trendlines and the Renko charts, and taking into account that spike down was made on extremely low volume, I decided that the rule of wave 4 entering wave 1 does not qualify as a broken rule in this case and should not affect the validity of the count. It is a decision I did not take lightly and after struggling over this issue for the last four days this seems to be the best possible solution to the problem of which count is most likely and valid.

8:41, Time for a different perspective on the SPX, a Renko chart. The reason I use them is because it smooths out the waves, cutting out the noise, and the indicators also work extremely good in this format.
To me, I am seeing a little more upside, but a very limited amount, there are two rising bearish wedges, one major and one minor wedge. The indicators are also still on a buy, but nearing the tops of their respected ranges, with long-term negative divergences. Also of note, is that we have five waves almost completed in the latest rally that started on December 7th.




8:14, Updated look at the Dollar, I have it most likely in the 4th wave, the RSI and the MACD normally will peak at iii of 3 then diverge for the 5th wave. There is support at $76.817 and Fib fan support a little higher. As long as it stays with-in the fan, the trend is up.

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