Ok, so if the March low of 1,340 holds then I agree with scenario 1 that the market would rally as a wave [V] for a retest of the highs.
If it doesn't, then one target for scenario 2 downtrend is the next fib level of the bigger 5 wave pattern, which happens to correspond very closely with the Wave 1 top of around 1,293.
Given that the 100day moving average and two large daily tails offer support on the SPX chart, it seems more likely that your scenario 1 will prevail. These corrective wave patterns are quite tricky, and definitely have more headfakes than the clearer Wave 3 pattern.
ScalperJoe - Good point! Yes, the 1340 is the wave-4 (the lower degree wave) where a corrective wave would stop. Thanks for summerizing those two scenarios. Today the market gaps up, we will need to see if the gap can hold or not. If the gap holds and market goes higher, then probably the wave-[V] is underway. If the market fails to move up, we need to be careful that it could be forming a wave-2 (corrective wave) in the scenario #2.
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today u said wave3-4 have finished.
how do you judge wave3-4 finish, by 30min macd crossing down?
could it be possible to have ABC, i.e. 1st leg SPX 1295 to 1328, then down to 1315, then tomorrow 2nd leg up to ~1340? thanks!
today u said wave3-4 have finished.
how do you judge wave3-4 finish, by 30min macd crossing down?
could it be possible to have ABC, i.e. 1st leg SPX 1295 to 1328, then down to 1315, then tomorrow 2nd leg up to ~1340? thanks!
hq1888 发表于 2012-5-22 22:12
hq1888 - Thanks for commenting. No, I don't use any indicator. Since the market has followed my purple line wave count the past two week (accurately to even each reversal day), I would rather believe that the market will continue following my purple line wave count until it says otherwise. Yes, it could be the ABC scenario if today's day high is penetrated. It could be anything. Since the current preferred count works pretty well, I would like to take your idea as an alternative count.