Wednesday, 15 September 2010

16:06 BST - SPX Update: ones and twos down?

This is how I'd count today's move on the bearish case at the moment:

SPX 1 min - 1-2-i-ii down from 1127.36?:

If we take out the high at 1122.39 this is probably wrong, though the labelled count isn't invalidated unless we take out 1126.57. However, unless we see some decisive downward movement, that moves quickly and signifcantly below today's low, its more likely to be wrong. So, watch  price levels and the manner of any downward move. 

As shown on chart 3 in yesterday's end of day update, we could just be in wave [4] of v up. If today's low is that wave [4], we'd be on our way to a further high above 1127.36.

In favour of the bear case - 1122.39 was a 61.8% retrace of wave i and it was also a nice back test of the lower line of the ending diagonal shown  on chart 1 of yesterday's end of day update.