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July 21st, 2010: Update 5 – Afternoon 2

Posted by pugsma on July 21, 2010

3:10 pm EST:  One other interesting item on the 15-min chart is the symmetrical contracting triangle pattern formed by the lower up trend line in blue and the upper down trend line in purple.   Although is is unintentional on my 15-min chart, it is interesting.   If you labeled the 1057 as A, 1089 as B, and now 1064 as C, then there would be a D up to 1075 and  E down to 1070 before a break-out to the upside.  I don’t have this a count, but it could be a wave (4) of 1-[1] up.  Wave (4) was never really significant in size on the move up from 1011 to 1099 and seemed missing.   That would make 1099 as the wave (3) of 1-[1] and this triangle as wave (4), with wave (5) of 1-[1] up yet to come.   Hmmm…intertesting.

3:05 pm EST:  With the cross below 1070, the wave-iv into wave-i violation elminates the continuation of wave (1) higher.   I have marked wave (1) at 1089.  The retrace thus far is marked as wave (2), however it must hold above 1057 to maintain that count.  There 78% retrace from 1089 is at 1064 and that is were the upward channel line resides this afternoon.  So we are looking for the 1064 area to hold as support.  The 20-day SMA is at 1068.   Below 1057, we will have an entirely different (alternate count) that will likely test the 62% retrace (off 1099 high) area of 1044.  This alternate count will show that the wave 2-[1] low has not be put in yet.  I will show this count on the chart after the close, if necessary.

SP-500 15-min chart (3:00 pm):

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