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Nov 10th, 2010: Update 3 – Mid-day

Posted by pugsma on November 10, 2010

1:00 pm EST:  I’m changing how I view this minor wave 4-[1]-P3 correction that we are currently in.  I don’t think it will be an ascending triangle.  I’m more inclined to view it at as a double Zig-Zag (ZZ) that will at a minimum test the 23% retrace target of 1184 over the course of the two weeks.

So far we have completed just the wave a-(w) of the first ZZ at 1204.  We are working on wave b-(w) up to 1214 to 1219 area.   Then wave c-(w) of the first ZZ should drop to a target area of 1192 to 1197 by the end of this week or early next week.   From this low at the mid-channel line, we should see an (x) wave going higher towards 1210 to 1215 in to OPEX week and finally a second ZZ corrective (y) of 4-[1]-P3 that finishes in the 1184 area by mid-Thanksgiving week.  I’m expecting support between the 1177 and 1187 pivots to stop this wave 4-[1]-P3.  This will also be near my lower channel line.

All this implies that the 1219 pivot will hold as resistance for the next couples weeks.  Any close back above 1219 changes my thinking.  But for now that is what I see.  The daily chart of the SPX is telling me that this wave 4-[1]-P3 correction will last longer and retrace deeper than most bulls expect.

SP-500 5-min chart: http://www.freestockcharts.com?emailChartID=c9af3b75-32b4-483c-86c0-31cffe8c1a5a

SP-500 15-min chart: http://www.freestockcharts.com?emailChartID=7ceb7469-f34c-431c-b77e-a0fafd9c3398

SP-500 5-min chart (12:35 pm):

SP-500 15-min chart (12:35 pm):

SP-500 60-min chart (12:35 pm):

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