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Dec 4th, 2009: Bullish Ending Diagonal?

Posted by pugsma on December 4, 2009

Update 9:00 pm:  I decided to take quick look at the Russel-2000 tonight since it made a big jump up of 2.4% today while the other indices struggled.  The small caps were the first to show signs of weakness in September and have been struggling while the SP-500 and DOW-30 were making fresh new highs in October through December.  Well this past week as seen the Russel-2000 come back to life.  The Russel is up 34 points (6%) for this week !!!  I just did a a new count on Russel and I think it may be setting up as an ending diagonal for the wave [5] of P1.  Target is about 650 bout December 21st.

So there’s the end of 2009 bullish scenario.  I still think we are headed down from here, but we need to watch this ending diagonal count closely early next week to see it’s confirmed by a break-out and close over 1113 on the SP-500.  Have a great weekend !

Russel-2000 60-min Chart:

Russel-2000 Daily Chart:

Well since the bears could not close (below 1098) the deal today, I can’t leave off the possibility of a count that will produce a new high.  So here it is.   As seen on the 60-min chart below, we could be in the final throws of a large Ending Diagonal for wave [5] of P1.  If this is indeed the scenario that plays out, look for a slow upward grind towards 1125 over the next week or two.  This could even climb to 1130 with some overthrow at the end of OPEX week Oct 18th.  It would put a pretty red bow on a bullish 2009 SP-500 and make a nice Christams present for the bulls.  And quite honestly, it would make a lot more sense than a nose dive into the end of year.  P2 down could then start in early 2010.

SP-500 60-min Chart:

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