Aug 9th, 2011: Update 2 – EOD
Posted by pugsma on August 9, 2011
6:05 pm EST: What a difference 24 hours makes. Last night at this time as I typed the EOD update from the LAX airport, the SP-500 closed down over -6% for the day at 1119 and ES Futures were dropping towards their eventual overnight low of ES 1077 (SPX 1080). Now 24 hours later the SP-500 closed up almost +5% and ES Futures are rising to 1177 (SPX 1180). That’s a 100 point swing to the positive in ES Folks ! Wow !
I’m tracking two counts tonight. Primary (red) count is that minor 3-[4]-PA ended at 1119 yesterday and is putting in an expanded flat (3-3-5) move for minor 4. Today’s reversal at 1101.54 was the start of a (c) of minor 4 that should carry toward the 38% retrace of 1194. From there I’m expecting minor 5-[3]-PA to drop to the rest the 1105 pivot or 1095, where minor 5 = 1.62*1. I’m expecting a major [4]-PA bounce to about 1194 again, then a major [5]-PA completion near the 1019 area.
The alternate count (blue) is that the entire Primary A (PA) move ended today at the Cycle 1, 38% retrace target of 1101. The rally off the 1101 low is minor A-[X]-PB headed for the 1194 area. From there a 50% retrace to about 1148 for minor B-[X]-PB, before C-[X]-PB reaches the retrace of PA targets or 1223 (50%) to 1254 (62%). I’m then looking for PC to drop down to test the 1019 area for a 50% retrace of Cycle 1 and the completion of Cycle 2.
So both counts are eventually headed to 1019. The difference is that the primary count will only be finishing PA of Cycle 2 at 1019, where the alternate count will complete all of Cycle 2 at 1019.
There of course is a 3rd count (call in 2nd alternate green) that is very bullish. It would assume that Cycle 2 ended to at 1101 or a 38% retrace of Cycle 1. Now Cycle 3 has begun and the market will begin making all-time new highs above 1575 in the next few years. In this very bullish scenario, you had you last great buying opportunity of the Super Cycle V secular bull market today at 1101.54. Next stop is somewhere around 2000 on the SP-500 by about 2018/2020. I trust you didn’t miss it? 🙂 This bullish count that Cycle 2 of SCV ended today is of low probability, but it is certainly within the spirit of the secular bull market that I’m forecasting in SCV. A shallow 38% retrace for Cycle 2 is certainly a possibility. The biggest issue with this count is the rather short 3 month Cycle 2 compared to the 26 month Cycle 1. But secular bull market corrections are often very fast and end quickly. I will not show this very bullish count on the charts until the 200-day SMA (1285) is breached back above for a few days.
Support is at the 1168 and then 1136 pivot. Resistance at the 1177/1187 pivot.
SP-500 5-min chart (EOD):
SP-500 15-min chart (EOD):
SP-500 60-min chart (EOD):
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