Friday, 20 August 2010

15:49 BST - SPX Update: 15 min pitchforks

This pink fork has been doing a good job, holding back the bounce yesterday at its median line and now providing support to the market at what may be the completion of wave [1] of iii down:

SPX 15 min pitchforks:

If we have completed wave [1] of iii, we could see a move back up towards the upper line of this fork and the upper line of the larger red fork - this is certainly possible bearing in mind the retracement levels shown on the chart I posted earlier.

Obviously, that would also take price back into that upward green fork, which is potentially bullish. If that happens, what we would want to see for the bear case would be a failure to get to the median line of that fork, preferably followed by a collapse back down out of it and back to the lower part of the pink fork - that would be bearish. Its what happened with the black fork shown in this post - and look what happened to the market when that fork failed.