Tuesday's Market 06/11/2013

In Friday’s post I indicated my opinion was that the 1644.40 late afternoon high would be the extent of the move from 1598.23. The SPX did go on to make a slightly higher high at Monday’s open, rising to 1648.69 at the open, but it has been downhill ever since.

The SPX gapped down this morning, dropping to 1622.92, before starting to rally. That rally to reach yesterday’s close, stopping at 1640.13. From there the SPX stair stepped lower, until it reached 1636. After a small rebound, the selling accelerated, dropping the index back to 1626.99. After a seven point rally, the SPX fell again, this time falling to 1625.68 just before the close.

The wave action from the 1648.69 high has been fairly complex, but does not look like it has completed a 5 Wave sequence from that high. First support appears to be at 1617, followed by 1602. This entire sequence from 1648.69 should complete near 1561.

Thank you. 

Friday's Market 06/07/2013

It was one of those days for the market. The SPX gapped up to 1632 at the open, and after a five point pullback, moved virtually straight up to 1642.63. For the next few hours the market meandered lower, dropping first to 1636, and then to 1632.98 after a small bounce. Just as it looked like the market was ready to roll over, the bulls roared back, taking the index to a new high for the day at 1644.40.

In yesterday’s post I gave my count from the 1598.23 low as Wave 1 up to 1617.29, followed by an inverted corrective Wave 2. This indicated a further move to the upside, and I gave 1645 as a target. Working from that count, the gap up open to 1632.41 was Wave 3. Usually, if a wave 2 is a complex wave, such as an inverted corrective wave, wave 4 is a simple wave. Today was an exception, as Wave 4 appears to have been another inverted corrective wave that terminated at 1632.98. This was followed by a well defined 5 wave structure to 1644.40, completing the 5 Wave sequence from the 1598.23 low. The 1644.40 high was just shy of my 1645 target.

The double complex was interesting, as it seems the same structure occurred leading into the 1687.18 high.

Today’s high should be the end of the current move, and should also mark the end of a larger wave structure. I have an upper limit of around 1661 for this move, so it is possible that the SPX will move slightly higher. As I mentioned, I believe today’s high marks the end of a larger structure, and the market should now be ready to correct. I would have an initial target of 1593, and a secondary target of 1548. This wave does, however, have quite a large possible range, and so may be a surprise waiting to happen. It will certainly bear watching. At the moment, 1661 seems to be the critical level. Any move above that may signal a move quite a bit higher.

Thank you.

Thursday's Market 06/06/2013

The SPX moved lower at the open, falling to 1605.19, before rallying to 1614.64. This rally fell just short of the 1614.95 high I was looking for the index to surpass to initiate a further rally. After being turned back from that level, the SPX dropped to 1607, rallied back to 1614, then fell to 1598.23. At that point the SPX did stage a rally. It moved steadily higher, in a choppy uptrend, until it hit 1614.45, again, just shy of the critical 1614.95 level. After a small pullback the SPX finally broke through that level, rising to 1617.29. A small pullback followed, and the SPX moved to the high of the day at 1622.24.

The move to 1598.23 completes now completes a 5 wave sequence for this move lower. This is best counted from the 1674.21 high, as the SPX formed the sequence 1674.21-1640.05-1661.91-1622.72-1646.53-1598.23. This gives a model value of .9988.

From the 1598.23 low, the SPX has been forming a more complex sequence. Waves 1, 2, 3, and 4 of a sequence formed at 1598.23-1603.76-1599.41-1607.86-1603.56. Wave 5 of this sequence included a double extension, as Wave 1 of 5 broke down as 1603.56-1607.99-1606.52-1610.44-1606.82-1610.94. The rest of Wave 5 completed as 1606.82-1610.94-1608.86-1614.45-1611.89-1617.29. From there, it appears an inverted corrective wave is forming, which indicates that the SPX should move higher.

This move from the 1598.23 low should end near 1645. At that point the market should once again move lower.

Thank you.