Market Remains Cautious !
2,424 has proven to be a strong resistance. Six weeks after the initial attempt, it is still unable to close above it ( only intraday penetration, not good enough ). Profit taking is likely to set in after two days of strong gains. If the pull back is shallow and thereafter it is able to make a new high, we may expect to see 2,600. If the pull back is hard, the last two days rally was probably a bull trap instead of a euphoria.
Wave 5 label has appeared in my Elliot Wave chart. Although this may not be the ultimate Wave 5 position due to possible recount, we ought to stay cautious because it can be ( the ultimate position ) if it wants to ( as a failed Wave 5 ). Now that Wave 5 label has appeared, the market is even more dangerous than few days ago before the strong rally ( where we were worried about the H&S ). The terminal of Wave 5 will be a vicious A, B, C correction which may bring the index back to near the onset of Wave 1. So this is really not the time to add new long....
Wave 5 label has appeared in my Elliot Wave chart. Although this may not be the ultimate Wave 5 position due to possible recount, we ought to stay cautious because it can be ( the ultimate position ) if it wants to ( as a failed Wave 5 ). Now that Wave 5 label has appeared, the market is even more dangerous than few days ago before the strong rally ( where we were worried about the H&S ). The terminal of Wave 5 will be a vicious A, B, C correction which may bring the index back to near the onset of Wave 1. So this is really not the time to add new long....
Labels: Market Direction
posted by Market Wizards @ July 16, 2009
Comments: 0
