Friday, 11 June 2010

10:39 BST SPX Count Options - Update

Yesterday I listed 5 possible counts for SPX (see here)

I've now seperated out the various counts (most of which I had on a single 60 min chart) into individual 60 min charts so that its easier to see the options listed. It might also be helpful to refer back to the longer term charts (very long term and daily) posted on individual pages (see the menu near the top of this page) in order to see the overall context.

Here are the 60 min charts:

Option 1 -  a) [i],[ii],(i),(ii),i,ii down; or b) [i],[ii],(i),(ii) down:

As noted on this chart, 1a) will be invalidated if we move above 1105.67 and I will then consider option 1b) to be in play. In turn, that would be invalidated above 1173.57 and one of the other more bullish counts may then be at work.

Option 2 - wave [i] down complete at 1040.78, now in wave [ii] up:

This is a little ugly with the way wave (iv) retraced, but it is valid. I'd be looking to somewhere near 1150 as the likely target for wave [ii], but there's reasonable resistance lower down (see chart) which might stall it out.

Option 3 - still in wave [iv] of a leading diagonal:

As long as wave [iv] can be counted as a zig zag (ie 5-3-5), this count seems to be viable. Also, the lines of the ld must converge. I've marked on the chart where they would be parallel.

As noted on the chart, some indices already count as complete leading diagonals. Only SPX and NDX do not. On SPX its because the last low did not go below the low of what would be wave [iii]. On NDX what would be wave [iii] didn't go below wave [i] and what would be wave [v] did not go below wave [iii] and it just doesn't look like a leading diagonal. All of these points on SPX and NDX are EW rule breaches.

Is it feasible that some indices are lds while SPX is still completing one and NDX is not one at all? Yes, its possible, but it would put them somewhat out of synch. The other indices would be in a sharp wave [ii], NDX would probably be in a more moderate wave (ii) and SPX would be in a wave [iv] which would also possibly mean a substantially weaker rally than in the indices that have complete lds. Or, on SPX we could disregard the ld altogether and assume its in one of the counts in option 1b or 2 above so it would still be in a wave [ii] along with the other indices. That would still leave NDX in a wave (ii) at best.

On the other hand, all of the indices are aligned (though on NDX it would have a truncated [v]) if counted as in option 1) above (either a) or b)) or 2. Maybe this is a good reason for maintaining those counts as the main bearish counts (though option 2 is somewhat more bullish near term). Just something to consider.

Option 4 - Intermediate [X] wave down in progress:

On this count, if we take out what is currently the wave [b] high within the second zig zag, it may just mean wave [b] is still in progress.  HighRev asked me on Daneric's blog whether [X] might already be complete at the 1042.17 low. Its very possible, but I think we'd have to take out 1173.57 (the X wave high) to be sure that wave Y and, therefore [X] has already completed.

Option 5 - Intermediate [X] wave complete at 1040.78. Now in minor A up:

This count would need to be revised with a drop below 1040.78