Daily Analysis

By: TheWaveTrading | Tue, Jan 31, 2012
Print Email

Last Thursday's bearish "short term" reversal is still "in force", but it needs an end of week print below 1306.06; recall last week's SPX Spinning Top.

The structure of the current pull back is clearly corrective, strengthening the scenario that I am following of being the wave (4) of (C), but it needs confirmation of a lower high/low.

Daily Momentum, with the RSI breaching the steep December TL & the Stochastic sell signal, is suggesting that the SPX up leg off the December 19 low should be completed.

Larger Image

The McClellan oscillator has finally breached its December TL and broken down from a bearish rising wedge suggesting "distribution":

SPX has broken the TL1 but, yesterday it recovered above the weekly pivot bearish # = 1306.06 and it even managed an eod print back above the 10dsma.

If the assumed wave (4) is in progress we cannot rule out that price may unfold a Flat or a Triangle (Alternation Guideline), hence price could retest last Thursday's high. Also the "last trading day of a month + first trading day of a new month" bullish bias could delay another down leg.

But Friday`s NFP should soon regain the market attention.

If this scenario plays out then:

Once the wave (C) is completed, a potential multi month top should be in place.

Larger Image




Author: 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 2011-2016 TheWaveTrading

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