Monday's Market

On Friday the market was up, completing a 5 wave sequence from the 1392 low late in the day at 1411, and then fading into the close. We said a 5 wave sequence down from that high had not been completed, and we expected the market to move lower at the open on Monday. From there we were watching for a break above 1411 as a signal of another 5 wave sequence higher. The market did open lower today, hitting 1404.46, and completing the 5 wave sequence from 1411. From there the market moved higher, breaking above 1411, and continuing up from there. A 5 wave sequence from 1392 was completed at 1420 and continuing higher still, completing another 5 wave sequence at 1422.38, the high of the day. From there the market fell to 1417, before rising and closing at 1419.04

While the market broke into new higher ground, our feeling that we are still experiencing a market top remains intact. We are still within our target range of 1378-1422 for that top, and the market has not been convincing in moving higher since it hit 1378.We are now, however at the top of that range, and a break above the 1422 would most likely signal a move higher from here. At the moment we will stand by our call of a market top, and look for a move lower from these levels.