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Oct 19th, 2010: Update 5 – EOD

Posted by pugsma on October 19, 2010

4:35 pm EST:  As I dicussed in the intra-day updates 1-4, if the SP-500 closed under the 1168 pivot support today, then this would confirm the top of minor degree wave 3-[1]-P3.  So with the drop to 1159.71 and the close at 1165.90, this means that wave 3-[1]-P3 ended yesterday afternoon at 1185.53.

The primary count is that there are 5 waves down for minute degree wave (a) of 4-[1]-P3 and thus it ended today at 1159.71.  Tomorrow I’m looking for wave (b) to bounce up and re-test the 1168 to 1177 pivot resistance and the broken lower channel line (blue).  Then wave (c) should drop down to the 1150 support area by the end of this week.  Notice on the 60-min chart that the middle channel line shows support in the 1150 area by then end of this week.  The 20-day SMA is also at 1156 and the 23% retrace target for wave 4-[1]-P3 is 1151.   Also, wave 4-[1]-P3 could evolve into a complex corrective wave (i.e. triangle) between 1150 support and 1177 resistance and last longer than the end of this week. (i.e. drag on into next week). 

The alternate count is that wave (a) of 4-[1]-P3 has only completed 4-waves down and there will be a 5th wave down tomorrow.  Wave v-(a) should test 1150; if wave v=i  then expect 1149.  From there I’d be looking for a wave (b) bounce to about the 1168 pivot resistance going into the end of this week.  Finally, wave (c) should find support near the 38% retrace target of 1131, which would be the (c)=(a) target.  This drop to 1131 would last into mid to late next week.  For this alternate count wave 4-[1]-P3 must remain above the 1129 level, which is the wave 1-[1]-P3 high.  A drop below 1129 would be a wave 4 into wave 1 violation and signal that a much deeper drop is in store.  But we’ll wait to concern ourselves with this if the SP-500 approaches the 1129 level.

Note, the target for wave 5-[1]-P3 remains at 1251 for the end of 2010.  This forecast remains valid as long as wave 4-[1]-P3 does not drop below 1129.  See the 60-min chart for the details.

SP-500 5-min chart (EOD):

 

SP-500 15-min chart (EOD):

SP-500 60-min chart (EOD):

SP-500 Daily Chart (EOD):

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