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.

Aug 5th, 2010: Update 5 – EOD

Posted by pugsma on August 5, 2010

 6:50 pm EST:  Some good news for the bullish primary count.  The AAII Sentiment Survey for Thurs Aug 5th shows the bulls drop from 40% last week to 30% this week.  And bears rose to 38% this week from 33% last week.  This is not too far off the 24% bulls vs 41% bears at the July 1st low of 1011.  So the sentiment is more bearish that bullish here at 1125 after the week long consolidation.   This should help the bulls climb the “wall of worry” higher.

Reported Date Bullish Neutral Bearish
August 5: 30.39% 31.37% 38.24%
July 29: 40.00% 26.67% 33.33%
July 23: 32.16% 22.81% 45.03%
July 15: 39.37% 22.83% 37.80%
July 8: 20.94% 21.99% 57.07%
July 1: 24.68% 33.33% 41.99%


6:40 pm EST:  After some early weakness, the SP-500 put a 3rd straight day of consolidation above the 200-day SMA of 1115.  For the primary count, I have labeled the last three days of consolidation a complex double Zig-Zag wave 2-(3) corrective.  I’m expecting a wave 3-(3) of 3-[1]-P3  move up towards 1170 to follow over the next couple of weeks.  So the SP-500 is right at the beginning of 3 of (3) of 3 move.   This move will break the 1131 neckline of the large head and shoulders pattern, signaling a move towards an ultimate target of 1248 for wave [1]-P3.  This is the same target area as the 1251 target for the Diamond Bottom Revesal Pattern should earlier today.

As the alternate count, I have the leading daigonal triangle for wave (5)-[1]-1-P3 completing tomorrow near 1131  to 1138.  The result of this count will be a severe sell-off back down to a target area of 1055 to 1169 over the next couple of weeks.  The A-leg of this wave [2]-1-P3 corrective should smash through the 1102 to 1107 gap support and the lower channel line, followed by a B-leg back-test of the broken channel, before the C-leg lands at the 1055 to 1069 area.  The large bearish rising wedge and the MACD triple negative divergence on the 60-min chart would support this alternate count.

So which count am I most confident in?  The primary count of course.   Let’s see what tomorrow’s jobs number brings.  It will certainly be viewed as a catalyst for either move, as the counts move in oppositve directions over the next couple of weeks.   The good news for bulls is that both counts will converge on new highs above 1220, with the alternate count requiring a signifcant drop first to produce some more bearish sentiment and bring in move buyers.

SP-500 15-min Chart (EOD):

SP-500 60-min Chart (EOD):

SP-500 60-min Chart with MACD (EOD):

Sorry, the comment form is closed at this time.

%d bloggers like this: