IBEX Short-Term EWP Update

By: TheWaveTrading | Thu, Jul 5, 2012
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While investors are wavering weather the corrective rebound off the June 4 low is over or if this move belongs to the initial stage of a new uptrend, I am in the camp of considering that price is unfolding a Double Zig Zag, hence if my short term scenario plays out there is one more pending impulsive or ending diagonal wave (c) that will establish the top of the countertrend rally wave (B). Hence once the wave (B) is in place I expect the resumption of the intermediate down trend with a wave (C) down. This assumed down leg that should extend into August may be the candidate to establish an important bottom.

The good news is that the majority of European & US indices are synchronized as they are unfolding the same EWP from the June 4 low; hence we have a wave (B) in progress across the board.

Lets go to the IBEX chart and the Double Zig Zag option.

Bearish Rising Wedge
Larger Image

If price is unfolding a Double ZZ then we need a 7 -wave up leg = (ABC=W; X; ABC=Y) then price is now involved in establishing the wave (B) of the second Zig Zag

The wave (B) has to establish a bottom in the range 6895 - 6770 or it MUST not breach the rising trend line support.

Once the wave (B) is in place I expect the last wave (C) up that will complete the corrective rebound off the June 4 low.

The equality target for the wave (Y) is at 7484 but since the internal structure of the rebound could be shaping a bearish rising wedge probably the pending wave (C) could top in the range 7305 - 7373

The April 18 gap down at 7373,3 where we also have the 100 d MA could be the "sweet spot" for the top.

 


 

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).

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