PUG Stock Market Analysis, LLC | Technical Analysis Blog

PUG Stock Market Analysis is here to help with SP500, QQQ, IWM, Gold technical analysis, stock analysis and more.

May 28th, 2010:

Posted by pugsma on May 28, 2010

5:20pm EST:  Well we got the down leg to 1090 and a little extra (1085) that I was expecting. I believe this was the wave (2) of a runnning flat off the wave (1) high of 1090. However, I’m willing to entertain some more downward price movement in wave (2). In which case wave (1) ended yesterday at 1103 and today’s drop from 1103 to 1085 was the a-leg of a 5-3-5, a-b-c, Zig-Zag. The ramp back up to 1100 this afternoon was the b-leg and we began the c-leg down at the close. For this variant of wave (2), the targets for the completion are from 1065 (62%) to 1079 (38%). A drop to 1065 would close the 1068 to 1074 gap left open by Thursday agressive push higher. The target for wave (3) of this count is the 1120 to 1130 area mid to late next week. And ultimately wave (5)-1-[1]-P3 has a target of 1140 to 1150.

The first altenate count is in sync with the primary count in that we are in wave (2)-A-[B]-P2 with a target for (5)-A-[B]-P2 at 1140 to 1150. And the second alternate count is that we are in wave iii-(5)-[C]-P2 down towards 1041.

Have a great Memorial 3-Day Weekend!

SP-500 15-min Chart (EOD):

SP-500 60-min Chart (EOD):

2:50pm EST:  Shake, shake, shake…”They” are trying to make the nervous longs think, “oh no, it is a failed inverse head and shoulders, get me out before the holiday”.

With the last drop to 1085, there are 5 waves down off the 1103 high. So, I’m forced to alter make primary count. I’m going to go with something I don’t use very often, and that is a 3-3-5 running flat for wave (2). A running flat ends up almost where it began so basically, so wave (2) ends were wave (1) ended or a little below it. And in between there is a big dip and big rise. Just what transpired after the wave (1) rise to 1090, then the fall to 1068, rise to 1103 and fall 1085.

So, my thinking is still the same in that wave (3) will be the wave that carries the SP-500 back above 1115 towards 1130 to 1140 by late next week.

Of the course the 2nd alternate (in red) is that we just had a waves i and ii of (5) off the 1103 peak and early next week will be a nasty iii-(5) drop to new lows below 1041. That is the count all the perma-bear E-wave blogs will be discussing this weekend, except they are going to call it a wave i and ii of the begining of the first big wave 3 of P3 down with targets towards 920. Next week will be a continuation of the test of who has the primary count correct. πŸ™‚

SP-500 15-min Chart (2:40pm):

1:00pm EST:  There was your retest of the 1090 neckline and potential “fake-out” below it to 1087, as I indicated below in my 10:45am update.  Also take a look at the SP-500 Daily Candle Chart showing the similarities of the Feb 5th and May 25th lows.  Today’s was supposed to be red bar down after the test of the 13-day EMA yesterday.  Tuesday should be an up day and by the end of next week the SP-500 should be above the key 1115 level if history is repeating.

SP-500 Daily Chandle Chart (12:31pm):

10:45am EST:  We have had the first successful back-test of the IHS neckline this morning at 1091.81.   I predicted a drop to 1090 in the primary count.  I’m looking for possible 2nd attempt to break this neckline and maybe even a head fake a few points below it to complete wave ii-(3) before wave iii-(3) gets underway.  But it’s also possible iii-(3) is getting underway already.  A close above the 1090 neckline keeps me bullish for early next week.

SP-500 15-min Chart (10:40am):

8:10am EST:  Overnight ES Futures were in tight range between 1097 (1100 cash) and 1105 (1108 cash). I’m still looking for this wave i-(3) to end here in the 1103 to 1108 area and a wave ii-(3) drop down to test the 1090 neckline before iii-(3) gets underway which should target the 1120 to 1130 area next week.  We need to get above 1115 in the cash market  over the next few trading days in order to confirm an intermediate term trend change.  The inverse head and shoulders target of 1140 is the final for the end of wave (5)-1-[1]-P3 or wave a-[B]-P2 of the 1st alternate count.  The 2nd alternate count has wave (4)-[C]-P2 ending here in the 1103 to 1108 area and a big drop down to end wave (5)-[C]-P2 below 1041.

SP-500 ES Futures 60-min Chart (8:24am):

Sorry, the comment form is closed at this time.

%d bloggers like this: