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Dec 7th, 2010: Update 4 – EOD – Intermediate Top Nears

Posted by pugsma on December 7, 2010

5:00 pm EST:  I had been thinking the SP-500 was only in minute degree wave (1) or minor degree wave 5.  However in looking closely at the Russel-2000 and Nasdaq, I believe both are in minute degree wave (3).   So for the SP-500, today marked the end of minute degree wave (3) of minor 5-[1]-P3.  I’m looking for simple a-b-c pull-back [ i.e. the alternates with the running flat of minute degree wave (2)] of between 23% and 38% for wave (4).  The wave (4) targets are 1221 and then 1212.  There is a wave c=1.62*a target of 1220 for tomorrow to complete wave (4).   Once wave (4) complete, my targets for wave (5) are 1246 and then 1251.   The 1246 target is where minor W5=0.62*W1 and the 1251 is the large inverse head and shoulders (IHS) target set-up by this entire major degree wave [1]-P3.  This wave (5) should complete in the next week or two.  After this wave [1]-P3 intermediate term top at 1251, there will be a significant > 120 pionts (> 10%) drop in the SP-500 for major degree wave [2]-P3.  My first target is 1131, or a 50% retrace of [1]-P3.  I’m expecting this major wave [2]-P3 drop to last 2 to 3 months going into Feb 2011.

And to drive home to the point that major wave [1]-P3 is running it’s final course, I’m showing a potential alternate count (blue) where today’s high at 1235.05 was the completion of (5) of 5-[1]-P3.  Today’s high satisfies all necessary E-wave conditions for the completion of major wave [1]-P3.   Food for thought, if you are planning to hold significant long positions into the beginning of the new year…

SP-500 15-min chart (EOD):

 

SP-500 60-min chart (EOD):

SP-500 Daily Chart (EOD):

 

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