Tuesday, September 28, 2010

Market Timing Update (9/28/10 Close)

[1030PM] resuscitating the higher rate count
Against market mentality and actions of front running QE-2, a closer examination of the squiggles UST 10-year yield suggests that the count for higher rates (i.e. as discussed in The Bond Mania (8/20/10)) may just pan out, even with the threat of QE-2. We'll see.

[4PM] Stocks, Gold, Euro

Stocks -
The rally in stocks appear very tired. Expect a trend reversal or at least a deeper pullback in the near term.

Today's fresh high may even be deceptive unless the market spike up in a [3] of iii of (v) over the next one to two days per the blue-count in the following charts (RUT and SPX).

ED any one? It's probable that the top is within reach tomorrow if it is not already in. The pink-count in the following charts (RUT and SPX) highlight this possibility in the form of an ED. Yes, the pink-count is less orthodox and a bit forced, but I wouldn't discount it too much as fifth waves are sneaky creatures.

The alternative is that today's high is wave iii of an ED wave (v). But beware of the risk when one entertains the possibility.


Gold -
Gold appears toppy and ready to reverse for the intermediate term, against a potentially bullish background.

Euro -
So does Euro for the near term, against a potentially bullish background.