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Tuesday, July 27, 2010

Tuesday updates

This is the chart I mentioned below, the 13/34 histo-gram of the 60 minute SPX, and is in blue near the bottom of the chart.
After the close, The SPX spent the day consolidating, and that normally means a 4th, or "B" wave. The best way to label this a 4th wave is in gray, but I am hesitant to make it my primary count because the indicators are not supporting the iii of 3 wave with the extreme readings commonly seen on most 3rd waves. Another count that is possible to label this rally from July 20th would be the double zig-zag, a-b-c-x-a-b-c, with today's triangle accounting for the last "b" wave, and one more wave up to finish it off. That is three different options, and personally, I do not like any of them for one reason or another, so, once again, the Technicals are providing better direction then the Elliott waves, and until we start making some important lower lows, the trend remains up.
Breadth for the day was only 1.26:1, decliners, on low volume, and these numbers are not out of the ordinary for a day of consolidation.
Support, and resistance levels are much the same as yesterday's so I wont repeat them today except for the fact the SPX closed beneath the 200 day MA which is at 1113.93, and is now short-term resistance. One of my short-term indicators did go bearish at the close, it is not part of the Trend finder system because of its whip-sawing effect, but is a good chart for catching smaller trends and day-trading (a 13/34 histo-gram on a 60 minute SPX chart). All of the indicators for the Trend finder do remain bullish.
10:56, The Bollinger Bands are getting tight on the SPX, normally a large move will occur soon after they tighten. With the way the indicators are looking, odds favor a break to the upside.

The Weekly chart of the SPX is very close to going 100% bullish with another cross-over of the MACD, and making a positive bar on the Histogram. Right now, the 20 Week Moving Average is acting as resistance at 1122.43, and it did stop the previous rally in its tracks, a close above the 20 MA, would put the 50 week MA back in play back up in the 1200 point range.

8:03, If the Ending Diagonal gets voided, here are some of the other likely spots for a top to a 2nd wave up. For a more bullish option, you can replace the blue, A-B, with a 1-2, up combination.

The Dollar is still respecting this bearish Fib fan I posted last month, but is finally coming close to support, to where a bounce should be expected, it still needs to breakout of the bearish fan before getting too excited about going long.

The VIX continues in its sell-off, making a lower low yesterday, the first sign that a trend change happening would be a break above that short-term trendline. There are gaps above, and below that are wanting to be filled.

Click here for a live, and updated chart!!!
Click here for a live, and updated chart!!!
7:24, The Ending Diagonal count is still valid this morning, and will stay valid unless the SPX breaks above 1121.51. The 1st wave measures out at 32.08 points, and the 3rd is 31.30, so as long as the 5th remains smaller then the 3rd, the count is OK. I do not have high confidence in this count, or any count at the moment, as there are some corrective, over-lapping waves in this rally that make a true impulse wave hard to count out without some serious rule bending. For now, following the trend is the best bet, and the trend remains bullish with all of the indicators still in buy territory.

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