Market Timing Update (10/8/13)

[EOD] Stocks -
Going back to basics, one observes a 7-wave decline based on lower lows (and lower highs) in SPX and ES. In addition, the decline has channeled well so far. Thus, odds remain favorable for recent weakness in stocks being corrective. See charts.
With a bit of speculation, the pending low might be the overthrow of a skewed triangle dating back to the May peak - see the ES chart and this chart and Shutdown(10/4/13).

[1115am] SPX/ES update -
At the moment,
ES counts as an EDT within EDT at the green line 1, or the blue ABC-ABC.
SPX counts as ABC or 1-down.

[810am] ES update -
Day 8. Q3 earnings after market close.
A slight lower low in the ES overnight satisfies the minimum requirement of the proposed A-B(triangle)-C(EDT) structure (Chart 2, blue AB and green C). If so, expect a budget deal.
Other possibilities remain, include the blue ABC-X-EDT and the red bearish triangle if one overlooks the slight lower wave d low. 

Market Timing Update (10/7/13)

[EOD] Stocks -
The A-B triangle-C EDT structure in ES discussed this morning continues to appeal. See charts.

[810am] ES update -
 Day 7 - see Shutdown(10/4/13) for discussion. In ES, the A-B triangle-C EDT structure looks appealing (Chart 1 blue A & B and green C). Chart 2 shows how it can fit into the larger structure.

MTU Weekend Ed. - Shutdown (10/4/13)

The U.S. government commenced its latest shutdown at the beginning of the month over funding disagreement.  The issue remained unresolved by the end of the week.

Stocks have remained dislocated. Nasdaq indexes, SP400 midcap and Russell 2000 smallcap made new highs while senior indexes broke their September retrace lows, filling SP500's last remaining gap since the August low.

 In SP500, the sell-off from its September high presents a potential wedge or triple three, which could count as an ending or leading diagonal triangle (Chart 1). If so, a near term rebound target around 1710 appears reasonable. With respect to the big picture, new highs in SP500 are probable, potentially fuel by the reopening of the government.  On the other hand,  a break of the August low is likely bearish.

In Monthly Outlook Update (9/27/13), we discussed four potential long term structures of the rally since 2009 in SP500.

At this juncture, those that accommodate an EDT (which will deliver the anticipated overthrow) look particularly appealing. Chart 2 and Chart 3 illustrate how a near term EDT fits into both bullish and bearish counts.

The upside risk to the proposed EDT is a skewed triangle discussed before.  If SP500 does made a new high but continue to extend higher, the advance is likely a potential wave five out of a skewed triangle dating back to the May high (see Chart 4-blue).

Market Timing Update (10/4/13)

[810am] ES update -
new moon. day 4. see charts.

Market Timing Update (10/3/13)

[12pm] SPX update -
SP500 fills its remaining gap since the Aug low.

[8am] ES update -
New moon tomorrow. So far during the current rebound, ES has retested prior trendline (Line 1) twice and the potential new support line (Line 2) twice. See chart.

Market Timing Update (10/2/13)

[EOD] Stocks -
Stocks attempted to rebound further but the market appears tired for the moment. Chart 1 and 2 tracks SP500 and its squiggles.

Budget related event risks (both up and down) are becoming more important as partial government shut-down drags on. A resolution would likely provide fuel for an upward extension, lack of which would likely test the market's patience.

A new high in NDX today meets the minimum requirement for a top from a wave structure perspective (Chart 3 and 4). However, MID and RUT are not confirming. Let's see if NDX (as well as other benchmark indexes) can manage extension.

[1035am] SPX update -
support at the gray trend line for now. see charts.

[640am] ES update -
Overnight reaction is likely a reaction at the prior neckline once again and at fib (Chart 1). Squiggles (Chart 2) tracking a double three up (red) or "impulse (LD)" up with retrace as 2/B.

Market Timing Update (10/1/13)

[EOD] Stocks -
New highs for MID, RUT, NDX/COMPQ.

[1105am] SPX update -
0.382 retrace and prior neckline overhead (Chart 1). Tracking squiggles (Chart 2).

[850am] ES update -
First day of the month. New moon in 3 days (US EST). Partial shutdown of U.S. government.

Overnight advance in ES met the prior neckline resistance (Chart 1).