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Monday, August 16, 2010

Monday updates

Yields on US Treasuries had another ugly day!!!
The Summation Index continues to print red bars, suggesting the longer-term trend remains down. I am adding a link to this chart, along with some others in my spare time to the upper-right hand corner of the blog, thank-you for the suggestion!!!
On the weekly chart of the SPX, the 20 week, and 50 week Moving averages are very close to crossing over, this is a sign that long-term investors use in determining the long-term trend, and is one of the most basic forms of Technical Analysis.
An important update on the Hindenburg Omen, the 10 week moving average has now shifted to a down-trend, and as long as it stays in that down-trend we can have no more signals. Currently the MA is at 6855.56, this morning the reading was at 6855.64, see note on chart.
After the close, the SPX looks to have finished its 5th wave down right after the open, and is currently tracing out a 2nd wave correction, which if it stays simple would be a sharp a-b-c, but things have not been so simple lately so I half expect this 2nd wave to morph into a complex correction, maybe a double zig-zag, a-b-c-x-a-b-c. The first point for a target would be that open gap between 1087-89 which also happens to be where the first point of resistance lays in the form of the 50 day MA, currently at 1087.49, and surprisingly, if it does turn into a simple correction, wave "C" would equal the length of wave "A", at 1088.29. 1092.28 is the 38% retracement level for the sell-off, and at 1104.45 the SPX hits resistance of the 20 day MA, which is approaching the 61% level, and when odds start declining the correct count is a 2nd wave up.
The SPX did make a minor lower low today, so the larger trend does remain down with 1065.25 the next previous low that would signal the trend continues downward.
Breadth for the day closed at 1.72:1, advancers, on really low volume.
7:59, The Russell breached the long-term trendline of support this morning, opening the doors for a test of the recent low at 587.67.
7:27, TNX, which tracks the yield of the 10 year treasury is getting hammered this morning, and has moved down into the most bearish part of the Fib fan (those blue lines).
Click here for a live, and updated chart!!!
7:17, The SPX remains with-in the bearish Fib fan, with upside resistance around 1080-1085.
Click here for a live, and updated chart!!!
6:49, The SPX opened gap down, and filled that open gap as expected, before reversing higher. A second wave retrace should take the SPX back up to the 1090-1100 range, with first resistance at 1087.43 from the 50 day moving average. It would not be surprising for this 2nd wave to have a smaller then normal retrace, that is less then 38%, but more then 23%.
6:45, The Trend finder moved from 100% bearish to 50% bearish.


  1. Hello everyone. The SP500 is breathing a little face to current depreciation. But the corrections occurred in both periods as a bull market in bear market, the average is superior to current correction, so there is still room to correct.
    Support zone between 1150-1162

    Review on:

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