Friday, October 7, 2011

Market Timing Update (10/7/11)

[EOD] Stocks -
Higher high in DAX, which is bullish in terms of the larger picture - see 1145am and 945am entries.
No higher high in any of the key U.S. benchmark indexes, including Transports - leaving the immediately bearish option of the final leg of a potential expanding EDT alive (see Chart 1, small degree trend lines). Chart 2 (ES) refreshes the larger counts.

Consolidated squiggle count across indexes suggests the sell-off into the close being wave C-down of a flat retrace in futures (expanded flat in INDU and NDX) - see Chart 3 (SPX) and Chart 4 (ES).
On the bearish side, the proposed flat may be wave W of a deeper and complex retrace.
On the bullish side, since no lower low is made running into the close and we have a weekend ahead of the next session, keep an eye on the possibility of a triangle.
[1pm] ES, SPX update -

[1145am] DAX at the close -
[910am] DAX higher high -
DAX made a higher high above its Sept high, likely a bullish confirmation. Next pivot is the late Aug high.
[845am] ES and NQ update (post jobs report) -
approaching a higher high. Is it [iii] of 3 (green) or [v] of 5 (blue) or end of C (red) ?

[710am] DAX, ES update -
DAX is very close to a higher high, an upward breakout likely serves as a confirmation of a trend change.
ES, an (fully developed?) impulse wave or an ABC rebound from the orth. low as marked? The potential retrace will tell.