Elliott Wave Update ~ 16 July 2012

Monday, July 16, 2012

Elliott Wave Update ~ 16 July 2012

The 30 minute SPX chart shows the best count possibilties. Either Minor 2 ended at 1374.81 or the market will trace a double zigzag which would take prices higher toward the 1390 level.

There is room however a modest push toward forming a wave (ii) of minute [i] of Minor 3 down which takes prices higher than Friday's 1357.7 yet keep them beneath the 1374.7 Minor 2 peak is one we need to watch.

The double zigzag scenario will require that the market expend a lot of effort to get above the previous 1374 mark. The SPX daily below shows the resistance that the market would have to deal with in getting above that price and holding it as support.  Its a tough nut to crack and one would expect that Minor 2 will have trouble doing so. After all, Minor 2 is perfectly expected to die in this resistance area or else it wouldn't be Minor 2.

A close under 1335 SPX would strongly put price action back in the bears' hands.

The NYAD count would count better with another new cumulative high. That supports one more push up in either forming a wave (ii) of [i] of 3 peak (between 1357 and 1374)) or else a new Minor 2 high itself (likely 1390ish).  So it should be interesting to see how prices play out over the next few days to a week.

S&P 500 Analysis after closing bell

• First chart shows trend lines and support lines which must be taken out for a bigger move to happen.
• Second chart shows the range 1325 - 1374 which must be broken for a bigger move.
• Last chart shows rising support levels with the up move of 200 Day SMA. For bears closing belwo 200 SMA will result in a bigger correction.