Monday Night Chart Dump

Let's start out tonight with the daily chart. Opinion among Elliotticians is, to say the least, divided, but this really looks like five waves up from the March low to me. Five waves up at this juncture can mean two different things.

1. It's the A wave of an A-B-C zigzag correction that will pull back soon and then go considerably higher.
2. It's the C wave of an A-B-C irregular flat, and we will head to new lows or a double bottom.

Note that irregular flats are, well, irregular and don't occur very often. Option 1 is the most likely occurrence, but I give option 2 some weight because the pattern matches up well with a more common flat pattern on the Nasdaq.

Either way, this means that a pullback based on the entire move up since May is in order soon.


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Here's an hourly chart. It shows an expanding triangle. We're getting close to the top trendline.

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Sorry about this one -- I'm doing this on a laptop and I was using MS paint to save my screen grabs. Note the major turns that happen when we hit the trendline drawn on the RSI(14) -- I'm not sure that it's valid TA, but it's worked well for the last year.

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It's a little early to say how all of this is going to end, but I'm seeing us rising in three-wave patterns. The shape is indicative of a possible ending diagonal. I'm watching the 38.1% Fib of the entire move up at 1013 and a gap from 1001-1005 on the S&P cash that has partially filled. Regardless of what shape it takes, there will be considerable resistance from the major fib at 1013.
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Now a few sentiment-oriented charts. Whenever the public gets too bullish, it means that more and more people are fully invested. We're near levels (the red lines) where the market has traditionally turned in the past.

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Here's the ratio of a three-month VIX index to the regular one month index. It has telegraphed turns in the past and is now diverging down.

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Note that the last few days of up moves were reflected in the Advance-Decline (breadth) line, but the past week or so still shows the divergence.

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The 10 day TICK moving average is still diverging down after hitting a very high level.

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The McClellan Oscillator tends to bunch up before heading down. The signal is confirmed once it crosses the zero line.

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The next chart is the same McClellan Oscillator shown above, only with a 10 day moving average applied to it. I use this because the moving average creates a curve that tends to fit into a range (shown by the horizontal lines.)

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This is the percentage of stocks over the 50 day moving average, and it's looking toppy.

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The percentage of stocks over the 150 day MA looks similarly high.

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One last chart: The McSum. Pointing up (and it is) is bullish. Pointing down is bearish. This is a great chart to confirm an intermediate term trend once it happens. Note that this indicator tends to lag the market.


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