The S n P is likely to break out from 1310 and rally on from some time.. good stop loss is 1304-1305 .. so if this breaks we have a nice fall in store. .. but the top is not yet formed. .. so cant say yet thanks mishwar
Hi Mishwar, Yes it's a very close stop but it might hold. I'm looking for one more rally to complete these five waves up. SPX 1316 is a long term EW pivot created during the bear market. Seems like a likely spot to end this advance, especially since it is the first wave up on the NDX. Chart: all my charts are linked to my site: http://spaces.msn.com/caldaroEW/ under the chart link at the right good trading!
INTERMEDIATE TERM: The staggered lows of the DOW (Jan), SPX (Feb) and NAZ/NDX (Mar) continue to act as a burden on this market. The DOW completed its five wave sequence just as the NAZ/NDX were completing their first wave, and the SPX was completing its third wave up in this intermediate term advance. Since then, the NAZ/NDX have rallied again in their third wave, and the SPX has reluctantly edged up higher, while the DOW has gone sideways. This market needs the DOW to extend its advance, but the continued weakness in the Bond market, has definitely cut short any rally attempts thus far. The MMI reflects the current status of each of the four indices: NAZ/NDX rising, SPX flat and the DOW declining. The EW pivot points have worked well during this advance. The NDX exceeded 1735 this week and fell just 1% short of the targeted EW pivot 1767. The SPX finally broke through heavy resistance at 1310, rallied to 1314 on friday just two points shy of its targeted SPX 1316 EW pivot. The DOW topped recently within 15 points of its EW pivot of DOW 11350. And, the NAZ is approaching its targeted EW pivot 2385. The market is entering a crucial point in the wave structure. The SPX/NAZ/NDX all appear to be advancing in Intermediate wave v of Major wave 3. Upon completion, the entire advance from the late April 2005 lows will have completed five waves up: currently a 26% advance in the NAZ. It will then be vulnerable to a potentially steep correction, possibly similar to the early 2005 correction, where the NAZ declined 13%. If fridays decline started wave 4 for the NAZ/NDX, the next rally (wave 5) should put in the top. Especially if the SPX/DOW do not make any significant progress during this 5th wave rally in the NAZ/NDX. A more defensive investment posture would then be warranted. http://spaces.msn.com/caldaroew/
Tony: I think you've been fairly accurate overall on your wave counts. You definitely opened my eyes to a lot of things and I am using EWT a little more in my analysis. Occassionally, I may differ in the application or interpretation of various market signals than you, but I appreciate your perspective.
Ever since the October 2002 kickoff impulse wave and the subsequent powerful March 2003 impulse wave, the stock indices have been gradually working their way higher in a subdividing Primary wave five. This is clearly a bull market in technical terms and Elliott Wave terms: specifically Objective EW terms. A simple review of the SPX displays: Primary waves I and II (Oct '02 - Mar '03), and Primary waves III and IV (Mar '03 - Aug '04). Then a set of five intermediate term waves (i -v) and a correction: Major waves 1 and 2 (Aug '04 - Apr '05). And, it now appears the SPX just completed another set of five intermediate term waves: Major wave 3 (Apr '05 - Apr '06). Therefore, it should now correct in a Major wave 4, only to be followed by another five intermediate term wave advance to complete Major wave 5, Primary wave V and the bull market.
Thx for this. What are your downside targets for this wave 4 correction and if we are not yet in wave 4 and wave 3 extends further what are your upside targets for this "extended/ing wave 3? Thanks!
YW. Downside on the SPX is only around 1254. Anticipating a double bottom - flat formation - to alternate with major wave 2. If the SPX can take out 1300 on the upside, and bypass 1316, the next EW pivot is at 1337.
Interesting...you have such "shallow" i.e. relatively high SPX downside targets. Some other EWavers/Gann/cycle guys beleive the market has topped for its bull run and will make substantial declines - sub 1200 in the spx... Using your analysis/work, is there anything that makes you believe there is a possibility of a sub 1200 SPX level being reached from here and that we've already had an intermediate term top? Any alternate EW counts you see that supports this more bearish view? Thanks again.