Monday, 1 October 2012

DOW and S&P intraday update

Last week I mentioned in my posts that bears should be very cautious as the decline from recent highs in the markets looks corrective and the upward trend will resume once again. Today's charts show us what we were expecting last week. The end of wave C down. In the S&P chart, the 5th wave down of corrective wave C ended higher than the wave 3 low in a truncation. This is the first signal that the downward move from 1474,51 is corrective. DJIA on the other hand managed to make a new low and finish wave C with 5 clear downward waves.  In both cases bears would start to count this decline as an impulsive wave (red wave count in first chart). However today's price action cancels any chance of an impulsive downward move since all waves are overlapping. So new highs are expected as mentioned many times before in this blog. The decline is corrective and found support at the previous 4th wave according to wave theory. If you need more help with trading this indices, don't hesitate to contact me.

Thank you for taking the time to read my thoughts.

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