Elliott Wave Update ~ 27 June 2012

Wednesday, June 27, 2012

Elliott Wave Update ~ 27 June 2012

Primary count has not changed.

6 month rate. Working on a wave 5 of (1) up in yields.  This implies that the all-time low has been set.  If 3 month yields hit .5 to .6, the Fed will likely raise interest rates.  The FED don't control rates, the market does.  Greenspan has reiterated this many times. The FED is certainly a major player and a has an influence on prices, but ultimately they cannot control the interest rate market. Social mood ultimately wins out.

Current CPCE.  Certainly not at any kind of bearish extreme.

S&P 500 Analysis after closing bell

• First chart shows price moving in a narrow band which is inside a larger price range.
• Second chart shows price contraction which may result in a big move.
• Daily chart shows price near the Ichimoku cloud which may act as resistance. Last fall too started near the daily cloud.

SPT UPDATE

Friday, June 22, 2012

With this sell off I will change my bullish perspective to neutral! The principal reason isn't because this sell off but the choppy patern since the May lows.

Wednesday, June 27, 2012

Trend Average Resistance

I made a mistake yesterday in posting that 1324 was a 38.2% retrace. I moved one of the Fob retracement tools on the chart by mistake so that level was not the right one. The correct 38.2% retracement is 1330 and today we saw the market go into Fib retracement territory and almost tensing the Trend Average which is still 1336. So unless the market manages to close convincingly above it, we'll probably see a 30-40 point move to the downside once the bounce wave is over which would test the 1300-1310 support area. So the suspense continues.. I continue to be long but hedging on the overbought extremes. I am not sure what will do it but I get the feeling the market will continue to rally eventually to new highs before a any substantial bearish wave.

Wednesday, June 27, 2012

S&P 500 ~ EOD Update ~ 27 June 2012

The SPX hit the resistance area at ~1335-37 shortly before the market closed:

Today's rally might have completed wave [ii]. If we get a break of 1307-10, wave [iii] should be underway. The minimum target for this third wave is the early June low. I think wave [iii] will decline further though, probably down to 1230-50.