Feb 18th, 2010: Overdue for a Drop?
Posted by pugsma on February 18, 2010
5:40pm EST: Well, I called for one more pop up yesterday and today we got a 7 point (0.66%) pop to close at 1106.75. The intra-day high was 1108.24. The 50-day SMA was at 1108.56 today. And 1110 is a 62% re-trace of the fall from the 1150 peak to the 1045 low. Thus, there are several reasons besides the wave count for the market to start to pull-back from this area.
For the primary count, I see this1108 area as the peak of wave (3)-1-[5]-P1. I’m looking for a wave (4) drop back about 38% of wave (3) to the 1090/92 area. And I think if that area holds, wave (5) could reach the 1115 to 1125 area early next week. Wave 2-[5]-P2 should then pull-back to about 1085/95 area late Feb to early March. Notice the bearish rising wedge in yellow on the 5 and 15-min charts. This is signaling a drop is near.
For the alternate count, we have completed wave c-[B]-P2 at a 62% retracement point. Now wave [C]-P2 is about to get underway which would be very bearish and could take the SP-500 to new lows below 1045. There are three targets for [C]-P2: [C]=0.62[A]=>1043, [C]=[A]=>1003, and [C]=1.62[A]=>938.
5-min Chart (EOD):
15-min Chart (EOD):
60-min Chart (EOD):
Daily Chart (EOD):
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