Tuesday, 3 August 2010

22:37 BST - SPX Update

Here's the close up of today's action that I've updated from my earlier post:

SPX 1 min - count from 1127.30:

The main count shows the (1)-(2)-1-2 down from 1127.30 on the assumption that we had a complete zig zag (single, double or triple) at that high.

The black dotted lines show the potential triangle that is forming if the single or double zig zag isn't complete (I explained in tonight's update that for the triple zig zag, a continuing 4th wave in the last  leg of the third zig zag probably wouldn't look right). Obviously, if its a triangle, the drop from 1127.30 to today's low, which would be wave a, must be counted as a zig zag, probably a double zig zag.

If the triangle is playing out, we've probably only had waves a, b and c, so there would be a bit more sideway's action to come tomorrow. The other possibilities for a continuing 4th wave correction from the 1127.30 high and the levels to watch that would invalidate them are explained on the chart and in tonight's update, in case the triangle is invalidated by a drop below today's low at 1116.76.