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Apr 14th, 2011: Update 2 – EOD

Posted by pugsma on April 14, 2011

5:15 pm EST:   McClellan Oscillator ($NYMO) is showing positive divergence wrt to SP-500 price from and over-sold condition of under -50.

SP-500 Daily Candles (EOD):

4:55 pm EST:   Looks like maybe the third time is a charm for finding the minor 2 of major [5]-P3 bottom.  I was calling for the 1305 area as a 38% retrace for minor 2, but jumped the gun at 1309.51, then 1309.19, and now finally 1302.42.  The reaction off the 1302.42 low this morning looked very impulsive in the initial move up to 1311.92, then faded into overlapping waves this afternoon.  There are several bullish indicators for  trend change from down to back up today:  1) the down channel (purple) on the 5-min and 15-min charts was busted to the upside late in the day, 2) there is positive divergence on the 15-min and 60-min MACD with the new price low today, and 3) the SP-500 close with a bullish daily hammer candle right at the 50-day SMA of 1315.

For the primary count (white) on the 5-min chart I’m going to label this initial move up as a Leading Diagonal (LD) Triangle for wave i-(1) of minor 3 ending at 1316.79.  Typically a LD will retrace 62% to 78% of the initial move, so a retrace back down to the 1306/1308 area tomorrow is possible, before wave iii-(1)  would target 1332, where iii=1.62*i, by the middle of next week.

For an alternate count (blue), the move up off 1302.42 today could be a series of i-ii, 1-2 waves, in which case the SP-500 should immediately challenge the 1322/1324 gap tomorrow, where iii=1.62*i.

On the 60-min chart we have  a very clear large Inverse Head and Shoulders (IHS) that measured 90 points (i.e. 1339-1249) and targets 1429 (i.e. 1339 + 90).  So the major [5]-P3 wave target is 1429 by mid-May to mid-June.

Support is at the 1315 pivot and then the 1303 pivot.  Resistance is at the 1322/1324 gap.

SP-500 5-min chart (EOD):

SP-500 15-min chart (EOD):

SP-500 60-min chart (EOD):

SP-500 4-hr chart (EOD):

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