Wavaholic - Stock Market Analysis and Forecasts - Elliott Wave Theory - Elliott Waves

S&P 500 ~ Intraday Update 1 ~ 26 January 2012

2012-01-26T12:42:00.000-05:00

Since the bounce at the support area around 1200ish mid-late December the SPX has been in a solid uptrend. As long as we stay in this channel you shouldn't even think of going short. Rather stay long and enjoy the ride up... it's as simple as that.

As you can see in the chart I added a tentative wave [iii] so we could see a small correction late January/early February. The uptrend looks very strong though, so, I wouldn't short just because there is now a wave [iii] at 1335...

Maybe you remember the big picture post I wrote about three weeks ago. If not, shame on you! Go and read it again: http://www.wavaholic.com/2012/01/s-500-big-picture-4-january-2011.html. : )

Since the market just kept moving higher the bullish count looks now pretty good. And as long as the SPX stays above 1265 it's my preferred count. So, at worst if you went long around 1270 earlier this year you'd get stopped out at break even (but you probably went long earlier or you already sold some of your longs this week so you'd be up even if you get stopped out at 1265ish ; ))

Silver ~ Update ~ 20 January 2012

2012-01-20T09:19:00.002-05:00

It's been almost a month since my last post on silver. Late December silver hit the support level at 26 $. Since then it has moved back up and hit the resistance area around 31 $ yesterday. If we can break it the next target should be 33 $:

S&P 500 ~ EOD Update ~ 19 January 2012

2012-01-19T18:24:00.001-05:00

As said last week, as long as the SPX stays above 1265 the trend is up:

Support levels are at 1295ish and 1265ish. I'll post more tomorrow morning.

Gold ~ Update ~ 12 January 2012

2012-01-12T16:22:00.002-05:00

As pointed out in my last update three weeks ago that, despite the break of the orange trendline, I wouldn't short gold because there is huge support around 1550.

And that's what has happened since then:

We got a huge bounce at the support at 1550ish and are now back at the 1670ish resistance area. If gold can break this area we could see a rally towards the all-time highs at 1900+. A break below 1550 on the other hand should lead to a sell-off to 1420-30.

Just out of interest I had a look at the linear scale chart of gold:

And guess what... there was a perfect test of the orange trendline. So, I guess gold bulls will use the linear scale chart now... : )

S&P 500 ~ Pre-Market Warm-Up ~ 10 January 2012

2012-01-10T09:29:00.001-05:00

So far, the market hasn't moved anywhere this year as we're still trading around 1280.

The ES rallied overnight though so the SPX will open around the October highs this morning. If we can break it we could even see 1300 today.

As long as the SPX doesn't close below 1265 we should go higher.

S&P 500 ~ EOD Update ~ 5 January 2012

2012-01-05T17:43:00.001-05:00

The SPX retested the previous resistance at 1265 today which is now support:

If you have a look at the chart it looks like the market formed an inverse H&S with a neckline at around 1265. So, if the SPX stays above this level we might go a lot higher. The target for this H&S is at around 1370.

S&P 500 ~ Big Picture ~ 4 January 2012

2012-01-04T09:53:00.001-05:00

It's been a bit more than three months since my last long-term update for the SPX.

During these three months the market moved almost as expected: Early October we got a decline below 1100 to complete five waves down from 1370. Then, on October 5th, I turned bullish and expected a three wave move to 1260ish. At the moment we're a bit above the 1260 level but it looks like we're in the last wave of this correction:

Both counts are very similar, at least short- and medium-term. At the moment I don't really care which one is correct as we can assess the situation again once we are around SPX 1000.

1160 and 1200 are the important levels to watch. If we break below these then the next downwave is most likely underway i. e. a sell-off to ~1000 should occur. The SPX shouldn't rally much above 1310 though else these counts are very, very unlikely.

Although these two counts look pretty good I always like to be as objective as possible and the rally from the October low has already retraced more than the usual 62 % so the following count is an alternative you definitely have to consider:

What if the correction (wave [X]) already ended at 1075? Maybe we're already in wave [Y] up towards new all-time highs (I know the economy is in bad shape but after all we're only 300 handles away which isn't that much since the market has already rallied 600 handles from the lows (and the economy wasn't in better shape back then...)).

In my opinion the level which has to hold is 1200. In fact, we should see a quick rally back to 1370 during Q1 2012.

To sum up, the counts point in different directions so I suggest to use the 1200 (or 1160) level to make your decision. If we're below it = bearish and above = bullish.

I think we'll know within a few weeks which way the market will most likely go this year so check out my daily updates. ; )

Updates will resume tomorrow

2012-01-03T16:38:00.000-05:00

I hope you had a great Christmas and a good start into the new year : )

I wish you all the best in 2012!!

Daily updates will resume tomorrow morning before the open.

Merry Christmas!

2011-12-24T10:28:00.001-05:00

I hope you went long at the 1200ish support level and made yourself a Christmas present! : )

The SPX rallied to the resistance at 1256 on Thursday, went sideways for half a day, and then rallied to the strong resistance area at 1265-67 on Friday. We're up more than 60 handles since we hit the important medium-term support around 1200 earlier this week! ; )

I wish you a Merry Christmas!

Hugo

Silver ~ Update ~ 22 December 2011

2011-12-22T04:03:00.001-05:00

Silver broke the level which was important for the uptrend to continue already mid November (33$). Since then it's been declining and hit 28 $ a few days ago:

Supports and resistances are shown in the chart above. The trend is down as long as silver doesn't break 31ish. If it rallies above 33$ the trend is up again.

S&P 500 ~ Intraday Update 1 ~ 20 December 2011

2011-12-20T11:57:00.000-05:00

Worked like a charm! : )

The SPX hit the support at 1200ish yesterday and today we're up more than 30 handles!

Gold ~ Update ~ 20 December 2011

2011-12-20T09:47:00.000-05:00

The medium-term uptrend was broken when gold fell below my support level at 1680. A sharp sell-off followed and a few days ago we almost hit the September lows again:

As you can see also the long-term uptrend is in danger as gold broke below the orange support line. I won't short gold though. Generally, I prefer to go long if we hit support levels/trendlines (with a stop a few bucks below it) and not to go short if we break it because very often you get a false break below the trendline (especially now since we have a strong support level at 1550ish so the risk/reward isn't that good).

Support levels are at ~1550 and 1430ish. Resistance is at 1670-80.

S&P 500 ~ EOD Update ~ 19 December 2011

2011-12-19T17:25:00.001-05:00

Nothing has changed. The SPX hit the upper trendline again on Friday and sold off to the important support level around the 1200 level today:

As already said a few times last week the short-term trend is down as long as we stay in the channel.

S&P 500 ~ Pre-Market Warm-Up ~ 16 December 2011

2011-12-16T08:41:00.000-05:00

The SPX rallied to the resistance at 1226 yesterday and closed the open gap. From there it sold off a bit and then traded between 1215 and 1220 for the rest of the day.

Not much has changed. The short-term trend is still down and important support is at 1200ish.

The downtrend channel looks even better on the ES:

Bears have the upper hand as long as we stay in this channel.

S&P 500 ~ EOD Update ~ 14 December 2011

2011-12-14T17:03:00.000-05:00

The pullback continued today and the SPX has already retraced more than 50 % of the late November rally:

I labeled the 1200ish area as an important support area. If the market breaks below it the medium-term trend will be down. As long as it holds though I still think there could be one more rally late December/early 2012.

S&P 500 ~ EOD Update ~ 13 December 2011

2011-12-13T18:19:00.003-05:00

We got a pretty decent bounce from the 1227ish level and hit 1250 in the morning. From there the market sold off and hit 1219 shortly before the close:

The market continues to trade within a downward channel since early December. The waves from 1265 look corrective though so a rally later this month seems likely. But as long as there is no convincing break above 1245ish the short-term trend is down.

S&P 500 ~ Intraday Update 1 ~ 12 December 2011

2011-12-12T12:31:00.001-05:00

The SPX is down even more today than it was up on Friday.

We're below the 1233ish support level now and there isn't much support until 1200ish. The two support areas in between are only highly speculative as they were perfect areas for a potential inverse H&S:

S&P 500 ~ Pre-Market Warm-Up ~ 9 December 2011

2011-12-09T08:40:00.001-05:00

We got a break out of the tight range yesterday: the SPX broke below 1245 and then sold off to 1232:

Supports/resistances and possible short-term counts are shown in the chart above.

There isn't a lot of support below 1233ish. 1215 or 1230 could be supports as these levels were perfect candidates for a potential right shoulder of a big inverse H&S. Many "if"s though.. so one step at a time. If we break below 1233ish I'll post a new chart with updated support levels.

S&P 500 ~ Elliott Wave Count ~ 7 December 2011

2011-12-07T17:49:00.001-05:00

And we hit the resistance at 1265ish once again:

So far, so good. There is our sideways consolidation early December and we may have already completed it today (as shown in the chart above). We've been trading in a narrow range since early this month though so I'd prefer a break out before going long (or short).

If we break above 1265ish the next target should be 1292ish.

S&P 500 ~ EOD Update ~ 5 December 2011

2011-12-05T16:56:00.001-05:00

The SPX opened higher, rallied to the resistance area around 1265, which I mentioned as a possible target for wave [a]/[i], and then sold off:

Nothing has changed: I still think that we could see a (sideways?) correction early December. If 1265ish breaks though then we could go much higher.

ES ~ Pre-Market Warm-Up ~ 5 December 2011

2011-12-05T09:17:00.001-05:00

The SPX opened higher on Friday and then sold off. So, as pointed out on Friday morning we may have completed five waves from the low at around 1160.

This morning though we're back near the Friday highs so we have to watch what happens after the open today. If we break above 1260/65 we might go much higher, else this could be just a retest of the recent highs followed by another sell-off to ~1240 (i.e. something similar to what happend in mid October). As said last week, we might see only a small correction followed by another move up into end of year (similar to October).

S&P 500 ~ Elliott Wave Count ~ 1 December 2011

2011-12-02T03:00:00.001-05:00

We got the expected fourth wave sideways consolidation yesterday. The SPX corrected to the support level at 1240 and then moved sideways for the rest of the day:

Wave (iv) is probably finished so we could see one more push higher. A possible target is the resistance around 1265. After that I think a bigger correction is due which should retrace a part of the most recent rally from 1159. If bulls get out of control and we get break above 1265ish next targets are 1275ish and 1292ish.

S&P 500 ~ EOD Update ~ 30 November 2011

2011-11-30T17:07:00.001-05:00

The SPX closed almost unchanged for November. Who would have thought that three days ago?

After rallying 88 handles within three days (!) we might get some kind of a consolidation early December (probably after one new high as shown in the chart). As we saw in October these consolidations can be mostly sideways so be careful if you're short (which I hope you aren't ; ) (or at least not since yesterday ; ))).

Below you can see my medium-term count. It looks like we completed wave B last Friday and are now in wave C. Possible targets are the October high at around 1293 or even the yearly high at 1370ish:

S&P 500 ~ Intraday Update 1 ~ 30 November 2011

2011-11-30T09:55:00.001-05:00

Wow! I hope you took my advice not to short seriously... : )

After all it looks like the a-b-c count was still the right one... I'll post more about the possible wave count today after the close.

S&P 500 ~ EOD Update ~ 29 November 2011

2011-11-29T16:47:00.001-05:00

The bounce from the sub 1160 area continued today. We hit 1204 early in the morning and then pulled back a bit and tested yesterday's high around the 1195-97 area:

As mentioned yesterday I think the rally should stop between ~1195 and 1210. So, if you went long around 1160 you might want to cover a part of your position.

The move from 1160 looks quite strong though so I wouldn't just blindly short around these levels. There is a pretty nice inverse H&S with a target of about 1235-40 so as long as the neckline at 1195ish holds we could go (much) higher.

Trade what you see, not what you think. ; )