Elliott Wave - S&P500 Cash Index - 11 Nov 10

Choosing Between Options

Why choose the A-B-C scenario from the April high instead of ending the correction at the July low? One of my reasons is the RSI (shown above the price chart). When it dropped below about 40 in 2008 it signaled a bear market was underway. Until the RSI moves back above the red zone in the chart I will prefer to view the current action as a corrective wave.

Elliott Wave - S&P500 Cash Index - 9 Nov 10

Over the last few postings I have reviewed the larger wave structure using the DJIA. Turning back to the cash SP500, we have the same structure that the DJIA does from the April 2010 high. An "A" wave down which ended on July 1 followed by the approaching end of a "B" wave.

The area from 1222-1228 is a fibonacci cluster area which also contains the TD Trend Factor target from the August 27 low. If my impulse interpretation from August 27 is correct then it must end before 1236 is breached since wave iii can not be the shortest when compared to i and v.

DeMark D-Wave Analysis (Part 3)

Following on from the last post .... Tom DeMark's objective wave counting routine counts out an impulse (1-2-3-4-5) pattern from the March 2009 low. I always try to make an A-B-C count after an impulse so I am expecting that from the April high.

Note the possible RSI divergence developing. We also have a perfected TD Sell Setup on the weekly chart now. So, possible exhaustion here but certainly not confirmed yet. If so we could be ending wave B of an Expanded Flat or Triangle.

DeMark D-Wave Analysis (Part 2)

Here is the wave count when the monthly and weekly time frames are taken into account. Instead of where the quarterly and yearly charts want to end Primary wave three (see previous post), Primary wave three of Cycle wave three ends at the 2000 high and is followed by a large expanded flat pattern.

At the 2009 low the question becomes: "Is the corrective move from 2000 over, or will the pattern extend or become an expanding triangle?"