Beginning of multi-month correction?

The Rising Wedge was completed today with a slightly higher high but not an all time high on the SP500 (The DOW put in an all time high). And this could possibly be signalling the end of the rally for this year. The only thing that could favor the bullish side is if the market is actually putting in an ABC move for its W4 (the one I have at 1752) so we have to see if the wave I have labeled as a bearish W3 continues or we see a sudden bullish reversal.

I was going to buy back VXX at a new all time high for the SP500 and the index came within less than 1 point of that. But since it reversed, I ended up backing back at the break of the Rising Wedge which still made it a profitable move. So now we'll see if the TA turns red tomorrow so I can better project downside targets.

Short Term Trend = Neautral Leaning Bearish
Medium Term Trend = Bullish

Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors. 

Rising Wedge?

The market came within couple of points of making a new all time high on the SP500 but then retreated quite a bit and now it looks like there is a chance a Rising Wedge or an Ending Diagonal (in Elliott Wave terms) might be playing out, which would support a 5th wave in the count. If the pattern does turn out to be a rising wedge then the new high might just be marginally higher (if W5=W1 then 1780) and we will then see a correction. I will buy back the VXX at a new high hopefully.

Short Term Trend = Bullish
Medium Term Trend = Bullish

Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors. 

Break out coming?

The market gapped down in the morning today but it failed to put in a lower low and instead put in the right shoulder for the IHS I wrote about yesterday. Obviously this pattern can fail but looking at the number of successful IHS this year, odds favor a break out as soon as tomorrow and the target is 1785 as I mentioned yesterday. However, looking at the micro waves I have 1790-1800 as a target so don't be surprised if we get another all time high this week.

I sold the VXX hedge given the bullish pattern so will be buying back if the pattern plays out as expected as that should complete the entire structure from 1646.

Short Term Trend = Bullish
Medium Term Trend = Bullish

Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors. 

Market Update

The market moved up a bit today but not enough to give us an idea of what will come next. I had been expecting a W4 correction and this is looking like one but the lack of selling might mean we will see just a correction in time and not much in price. I see a potential for an IHS that targets 1785, if a lower low is not made in the next few sessions then we will see another all time high fairly soon. I will continue to hold both of my positions until I see a definitely break either way.

Short Term Trend = Bullish
Medium Term Trend = Bullish

Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors. 

Market Update

The correction continued today and the market put in a lower low, so perhaps the market is getting closer to a bottom and a stronger rebound. Ideally, I'd like to see 1740 tested but since this is a profit taking "sell off", downside might be limited given all the bullishness in the market. Hard to say without a good a proportionate count in place, so I am staying put with both my longs and my VXX position until I see a clearer picture. As it is, I welcome more upside or downside as I am confident I will exit both positions profitably. It is already November (this year flew by!) and given how much the market has rallied already this year, I wonder if there will be a Santa rally this year, that would probably put the market at 1800+ .

Have a great weekend!

Short Term Trend = Bullish
Medium Term Trend = Bullish

Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors. 

TA being tested

The market tested the Trend Average as I had been expecting and bounced right off and I suspect the low today at 1755 was the end of the micro 5 count I had been tracking. So if we don't see another counter rally high tomorrow and today's lows break then I expect 1747 to provide support and then 1740 if that level fails. My plan was to sell VXX at the TA test but I was asleep, so I'll wait for the C wave to come to test the levels I mentioned to pick up some profit. I just hope the micro 5 to 1755 was "the" correction as I've seen several 5 wave W4's this year already.

Short Term Trend = Bullish
Medium Term Trend = Bullish

Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors. 

 

Correction

The correction I had been expecting started today and obviously we now need to see what degree of a correction this will be. But as you know I enjoy projecting targets so if what we saw today was part of a micro 5 wave count, then I have 1750-55 as the target for the first leg which I will label "a". I am looking for 1740 as support for the entire correction, so perhaps that will get tested on the "c" wave. I'll probably take some VXX profit at around the TA and will be buying back on the bounce.

Short Term Trend = Bullish
Medium Term Trend = Bullish

Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors.