Earlier today I tweeted two key levels of support that I am watching... 1537.25 and 1533.25. On the 4 hr chart, notice the support level created by the .618 extension lies just below the level where the market found support during Monday's sell-off. Just below that, the .618 retracement has been tested and provided support ( 2 ellipse indicating tests ).
At the daily chart level, 1533.25 lies 2 points below the .618 retracement. From a technical perspective, if a significant breach occurs (on a closing basis), that break would create a lower low and IMO needs to be respected. In addition, the break of the Trendline and the subsequent pullback that tested the underside (now resistance) bodes well for the bearish case.
Before attempting to publish a preferred wave count, it's important to note that I'm not trying to call a top here. I believe the current bull cycle is over extended through the FED's policy. Therefore, so long as extraordinary monetary policy prevails and absent any clear signal of a trend reversal I will not be arrogant and attempt to call a top. As many others have found out .... doing so have been futile, time and time again!
However, I am personally very focused on identifying any key reversal patterns that develop. When the evidence is overwhelming that the advance from 2009 had ended, which also includes a clear five wave impulsive decline, only then will I label the final subdivisions.
Until then, let's continue to put the pieces together... one wave at a time.
Best of Trading
======================================================================
ElliottwaveLive is not an investment advisory service or broker dealer. None of its contributors are registered investment advisors, licensed stock brokers or CTA's. The author may hold short term and long term positions in the futures, stocks and ETF's discussed herein. The author may also trade around those positions which may be in direct conflict with your positions. Complete trade disclosures of the contributor’s holdings are posted at www.elliottwavelive.blogspot.com. See Trader Disclosure.
Trade at your own risk. The blog site, Newsletter and all other information, material and content accessible from this Site (collectively, the "Content") provided herein provides the context for market analysis with respect to a market's, a security or a commodity's general position utilizing the Elliott Wave Principle. The Content contained herein are the opinion and general comments of the author and is based upon information that Mr. Sinibaldi considers reliable but neither ElliottWaveLive nor he warrants it's completeness or accuracy and it should not be relied upon as such. Mr. Sinibaldi or ElliottWaveLive (collectively, referred to as “EWL”) are not under any obligation to update or correct any content provided on this website. Any statements and or opinions are subject to change without notice. The content and comments contained herein neither purports nor intends to be, specific trading advice. It has been prepared without regard to any particular person's investment objectives, financial situation and particular needs. Information should not be considered as an offer or enticement to buy, sell or trade.
A more and comprehensive Risk Disclaimer and Disclosure Statements is available within the left margin of this blogsite.
======================================================================
Fair Disclosure Notice: I do not have a position in any of the aforementioned futures markets or securities related to this article.
No comments:
Post a Comment