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The "old" upper trendline, now at Spx 1124 was not severely tested in weakness
late last week. That may be all of a retest we need.
The most important trendline on the attached graph is the thick blue line
running through spx 1124. This long term line runs from late April, and is
indicative of previous resistance. Now broken, this line should provide any
needed support. We remain quite close to this line and although the odds
suggest a good move up here, the further away we get from this danger area,
the better.
The largest "degree" labeled is the impulse move in purple. The 0 to 2 lower
black trendline remains in tact, and the wave action indicates that purple
wave 4 has not commenced. It is highly probable that if or when that black
line breaks, Purple wave 4 will be under way.
Moving to the smaller red impulse wave, we see that the 0 to 2 trendline in
red was broken, and it appears likely that wave 4 of this degree is underway
now, or may even be in the process of completing. A good break of the pale
blue, or turquoise red wave 4 upper trendline will be an excellent indication
red wave 4 is over.
Staying with the red impulse move, I have drawn the next important lower
trendline, the wave 2 to wave 4 lower trendline in green. We cannot be sure
that wave 4 is complete, so we may need to nudge this line slightly should the
price action "push it" over a bit. This line will become most useful after
we get the next move up (wave 5, if 4 is complete). On completion of red wave
5, this green line will be broken very quickly, to indicate the completion of
the entire red impulse wave (purple wave 3). This will give us an early
warning that purple wave 4 is underway, and it is at this point we "may" see
the purple 0- 2 lower trendline get broken as a double confirmation of the
start of purple wave 4.
Summary:. As long as Spx 1124 remains intact, a powerful move up is possible
at any time. We have completed a two and a half month correction, and should
head for Spx 1225 for a minor correction, and then continue up to the Spx 1300
area for a more complex correction. The Short Term page
(http://tiger.golden.net/laird/ShortTerm.htm) provides a graphical
representation of the expected path. We have just moved through pivot days
for the Dow and Spx. The resulting change in trend of the past two days of
weakness will be evident tomorrow Monday the 29th, as the mysterious effect of
the Fibonacci mathematical sequence takes hold upon the financial markets .
(http://tiger.golden.net/laird/TimeSPX.htm)
Peter
http://tiger.golden.net/laird/Comment.htm
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