Daily Analysis

By: TheWaveTrading | Tue, May 15, 2012
Print Email

Today only a short and brief update, it is holiday in Madrid so I will try to spend most of the day with my children.

Yesterday we had a gap down and go.

The 1340 SPX key pivot support level was breached. The Dow erased the positive divergence that was sustaining the "live on hopes" scenario of an immediate bullish resolution of the corrective pattern.

It is now a fact that SPX despite it is unfolding a corrective EWP now it has only "thin air" until a potential target box located in the range 1300-1285 where I expect price to establish an important bottom.

The overall picture in my opinion remains bearish. As I mentioned in my last weekend update my preferred scenario calls for a wave (B) pullback.


Larger Image

Sine we are dealing with a corrective EWP we have to be open minded, but so far, from the April 2 top price is unfolding a Zig Zag down (ABC correction) with the wave (C) in force since the May 1 peak. As a reminder the wave (C) has to unfold an impulsive 5-wave structure (or an ending diagonal).

For the immediate time frame, in my opinion, price has two options:


Larger Image

In my opinion the option of a relief rebound (countertrend move) is more likely since SPX is now oversold, we have yesterday's eod print below the lower BB and we have oversold readings of:


Larger Image

 


 

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/