Monday, November 28, 2011

Rally or Rebound?

"this sideways move resembles a W4 of a W5 so I am going to assume it is going set itself up for a final sub-wave down to perhaps 1157 to finalize the correction and start a rally from there.".. This was posted about a week ago and the market ended up going down to 1158 on Friday and today we saw the rally I had been expecting. The market should test the TA and the 50 day MA soon but what remains to be seen is if this wave is an W1 of a rally that will take us beyond SP 1300 or an ABC bounce to the 1200-1225 area. So how the market behaves at the TA (which originally gave the bearish signal weeks ago at 1259) should give us an idea for December. I favor a big rally due to the 1074-1292 wave but I'll let the TA be the ultimate signal on this..

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