Monday, 18 October 2010

21:17 BST - SPX End of Day Update

With no significant level to the downside being breached, the trend remains up. 
Here's a close up of the most bullish count, the bigger picture for which you can see on Chart 3 on the 60 min counts page: 
Chart 1: SPX 1 min - bullish count:

Here, I'm assuming we've started wave [3] of v up. I've put us in wave (3) of [3]. If this labelling is correct, the next decline will be wave 4 of (3) of [3] and will have to stay above the wave 1 high at 1177.32. If it takes that out, then the count will need to be reviewed.

Here's the other bullish count I mentioned on Friday:

Chart 2 - SPX 60 min moderately bullish count:

As I said on Friday, I think I'm starting to prefer this count over the one shown in Chart 1 above simply because its more likely to produce a wave (v) that's in proportion to wave (i). As mentioned, because wave iii is shorter than wave i on this alternate count, wave v would be limited by the size of wave iii, which is 28.67 points. So, if wave iv ended at the low of 1171.17, for example, wave v couldn't exceed 1199.84. If wave iv ended where I've labelled at at 1172.38 then the limit for wave v is 1201.05 (I mentioned in my post earlier today that either of those lows could be counted as the wave iv low).

Here's the close up:

Chart 3: SPX 1 min - close up of moderately bullish count:

If we drop below the wave [1] high at 1181.80 on the next decline, I'd start to think that we may have topped on this count at today's high. However, better confirmation would, in my view, come if we drop below the wave iv low either at 1172.38 or 1171.17.

Here's a revised 60 min chart for an ending diagonal from the August low:

Chart 4: SPX 60 min ending diagonal from August low:

And here's a close up:

Chart 5 : SPX 1 min - ending diagonal from the August low close up:

This shows a potentially complete count for the diagonal, but be aware that wave (v) could go higher as long as it doesn't exceed 1219.22.

Taking out the low at 1171.17, where I have labelled wave b of (v), would suggest that we'd seen a top, but I'd rather see the wave (iv) low at 1166.71 get taken out.

So, following today's action the main levels I'm watching are: 1181.80, 1177.32, 1172.38, 1171.17 and 1166.71.

15:51 BST - SPX Update on the bullish, moderately bullish and bearish counts

Here's the bullish count from Chart 1 in Friday's end of day update:

SPX 1 min - bullish count:

If the labelling is right and we're in wave iii of 3 of (3), we first have to stay above 1176.12 which is the wave i high.  Take that out in an assumed wave iv and this count will look unlikely. Even if we stay above it and make a new high, subsequently taking out 1171.17 will invalidate this count.

Here's the moderatley bullish count mentioned in that Friday update:

SPX 1 min - moderately bullish count:

Here, we have to stay above the wave iv low at 1172.38. However, that low may be at 1171.17, depending on how you label the triangle, so really, I'd like to see that low taken out before I'd think this count may no longer be viable.

Here's the bearish count from Chart 2 in Friday's end of day update:

SPX 1 min - bearish count:

Pretty straightwforward here - we have to stay below 1184.38 and take out the low of wave [1] which is at 1166.71, but taking out 1171.17 would be a start.