Wednesday, February 15, 2012

Market Timing Update (2/15/12)

[EOD] Stocks -
In yesterday's EOD update, we observed three options which is refreshed in Chart 1 below. Today's price action sheds more light on the relative likelihood. We list these in order below. Please disregard the inconsistency of the wave degree labels among different charts - will clean them up in the future.

[most likely] Wave four since the Nov-2011 low has already been in progress for a few days. See Chart 1 green and Chart 2 purple. Wave structures in the Transports appear to corroborate (See chart to the right).

[likely] The impulse wave from the Dec-2011 low is over. A major trend change is at hand. See Chart 1 blue and Chart 2 green alt. The problem with this count is that it is hard (while possible) to count the new high in SPX today.

[less likely] Wave [iii] of the impulse wave from the Dec-2011 low is itself extending. See Chart 1 and Chart 2 pink. The problem with this count is that it does not work for the Dow.

[1pm] SPX squiggles -
see 2nd chart below
[1125am] SPX squiggles -
primary tracking count - green

[710am] DAX, ES update -
It's easier to count DAX and map it into ES. Best counted as an extended fifth at the moment, but also see yesterday's EOD update for a more bullish alternative that is gaining attention. In either case, a near term pullback is likely not far off.