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Jan 12th, 2010: Correction Day

Posted by pugsma on January 12, 2010

2:40pm:  So the 1030.38 level has held thus far.  Now we must decide if this correction was just a simple a-b-c for wave (4) of 3 of [5] and we head higher in a wave (5) of 3 of [5] or is this run up to 1149.74 complete for the end of wave (5) of 1 of [5].  It’s difficult to say.   However, since the trend is up, you have give the edge to the bulls in pushing this higher.  Good earnings later this week and grear bank earnings next week would do the trick.

If this run is over then this first leg down would be wave (1) of A of 2 of [5].   If we are headed lower, I have a 1115 target for the completion of A of 2 of [5]and I think the C of 2 of [5] is going back down to the 1075 area.  That would be 75 point (6.5%) correction.

If we head higher I have a target for (5) of 3 [5] at around 1170.  And I think 5 of [5] count take the SP-500 to near 1200.  That would be another 50 point (4.3%) advance.

15-min Chart (2:40 pm):

60-min Chart (2:50pm):

11:20am:  I apologize for not being able to update the SP-500 near term charts.  There is big glitch in the FreeStocksCharts.com data on the SP-500 showing a drop to 1044 and it has the 15-min and 5-min charts all screwed up and unreadable.  Below is the 60-min chart (you can see the glitch), but at least it’s readable.  The drop below 1138 tells me that this is not wave iv of (3), but rather we are in wave (4) now.  I’m still looking for the 1130 as the next key level to watch.  If 1130 holds, then wave (5) could begin soon.

60-min Chart (11:20am):

8:20am:  A correction day is upon us.  Now how much?  Futures are off about 7 points as I type, so about 1140 cash market.  Remember the key levels to watch early today are 1142, then 1138.  If support holds there, then this currnt move up could be resume quickly with some authority.  However, if the SP-500 falls below 1138 and approaches 1130 this could be a longer lasting (few days) correction.   I’ll post a chart once the cash market opens.

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