Daily Analysis

By: TheWaveTrading | Thu, Dec 8, 2011
Print Email

Yesterday I mentioned that: "SPX choppy action may have left by eod a potential reversal pattern if today price confirms a potential Double Top by breaching the 1250 horizontal support. If confirmed the DT has a target at 1233, where we also have the 10 dsma. If lower then the next target is at the .382 retracement = 1225"

Well we got the drop below 1250 but it did not have enough follow through to the down side to reach the obvious target of the DT at 1233.

Instead after completing a shallower impulse which can be labelled as a wave (c), dip buyers stepped in with an aggressive move, although price did not manage to achieve an eod print above the 200 dsma = 1264 leaving another toppish candlestick = Spinning Top.

The short-term key levels remain the same:


Larger Image

The move off the lod is atm a 3-wave up leg hence if the correction is over price should not overlap today below 1258.89, although we should not rule out a 1 2; I II ..... Hence the line in the sand is at 1251.89

If a bottom is in place the next leg up will have an extension target in the range 1311 - 1352 and given the potential EWP off the October 4 low which calls for a Zig Zag then it should be the wave (3) of (C).


Larger Image

On the negative side we have the daily Stochastic in overbought territory. It is questionable that we have the kick off of a wave (3) with a stochastic at 92.


Larger Image

I would have preferred a deeper measured correction in order to increase the odds of a larger push into year-end. In any event this is not a normal market environment so we have to strictly follow the s/t price action.

The DAX should help us identify if the correction is over. It has a clear price structure with a potential completed (ABC) in addition to having almost reached the Double Top target.

Here as in the case of SPX we have a 3 -wave push off yesterday's low, hence if bulls achieve a fiver they will seal the deal.


Larger Image

Contrarian Indicators:


Larger Image


Larger Image


Larger Image

Today we have the ECB meeting, while tomorrow the EC summit and next week we have FED day on Tuesday and quarterly OPEX on Friday. It seems that no relax will be allowed until Christmas's dinner !!!!!

 


 

TheWaveTrading

Author: TheWaveTrading

TheWaveTrading

Contact: If you would like to contact the author, you can e-mail him at thewavetrading@gmail.com

The main objective of this project is to share my views on several markets and asset classes.

In the initial stage TWT website will be a free service.

My main focus will be the equity market with SPX being the leader but I will also follow US equity sectors, major European indices, fixed income, currencies and commodities markets.

My analysis is based upon traditional Technical Analysis, Elliot Wave guidelines and investor sentiment.

My goal is to establish the most likely path that the price of a particular asset will undertake and profit through ETF instruments both on the long and short side and mainly with leveraged ones (2 x & 3 x).

The advantage of ETF investments is that it allows getting involved in equity indices & sectors, currencies, fixed income, commodities etc.

Therefore the main purpose of TWT will be to establish investment strategies regardless if the market is in an up trend or in a down trend, leveraging the chosen scenario while managing the risk by establishing protective stop losses.

Hence I will always define the risk, I will try to let winners run the wave and I will cut the losses if my strategy is wrong.

Disclaimer: The content of this article is for educational purposes only, the information supplied is not a recommendation to buy or sell any security or financial instrument.

Thewavetrading.com nor the owner can not be held responsible for any loses occurred from the information provided within the website.

The Information supplied cannot be copied or reproduced without the permission from the owner.

Copyright 2011-2014 TheWaveTrading

All Images, XHTML Renderings, and Source Code Copyright © Safehaven.com

SEARCH





TRUE MONEY SUPPLY

Source: The Contrarian Take http://blogs.forbes.com/michaelpollaro/
austrian-money-supply/