Elliott Wave Stock Market Update - October 31

"every single time the market has been this oversold in the last two years, we've seen rallies to new all time highs. Will this time be different?"

I posted this on October 2nd and it looks like the pattern is repeating itself. Technically, the market made an all time high in pre-market and closed within a point of the all time high in the cash market. But on the DJIA and the Nasdaq, they both closed at new highs for the year (ATH in the DJIA). So it looks like the market will continue making new highs for the remainder of the year, with or without a pullback. If the market can correct to 1912-1925, we would have a big Inverse Head and Shoulder's set up with a target of 2220 and would fit in well with a Christmas and January rally. However, if the market punches through resistance again (2019), this wave could go parabolic to 2220 without a significant correction. The medium term signal has turned bullish, so now it is all clear for bulls. I am enjoying the longs I bought in the upper 1800's, but my hedge at 1973 is starting to worry me as I wasn't able to stop out at 1999 as the market gapped up towards the 2019 resistance this morning. Hopefully, I'll be able to get out of it without much damage by position trading or better yet on a correction towards the Trend Average.

The excuse for the rally today was the Bank of Japan's unexpected QE announcement, which helped push the Nikkei to a 52 week high. But the rally there was already in the works, so it's not really a surprise.  Also, China's SSEC is also at a 52 week high and challenging a multi-year resistance level. So we have the first, second and third largest economies in the world at 52 week highs. Which tells us, we might be seeing the start of another significant bullish run that will last for a while. The economies of Europe and commodity dependent countries (notably Russia) are not faring as well, but I don't think they will be able to stop the momentum being built up by faster growing economies. 

Have a great weekend and Happy Halloween!

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


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.

Elliott Wave Stock Market Update - October 30

The market was able to reverse all the losses from yesterday and challenge the 1999 resistance level, eliminating the bearish 1-2 set up and putting into question the V wave label. If the index overcomes 1999, there's a good chance the all time high will be challenged. Goes to show just how much the market was worried about the end QE. I am sure some excuse will come up soon for a correction or even a sell off, but in the end it will be just excuses to screw bears and panic sellers as this market has shown again and again for the last 2 years. Bears are probably between sore and numb at this point.. here's a chart to remind us of all the "panic attacks" this year.

But as I always say, it is about the economy! strong economy=strong profits=bulls win. Until the economy shows real deterioration or sharp increases in interest rates, the market will be pricing in profit growth.

I am holding on to my hedge but I might stop out if 1999 and try it again at 2019. I am sure the market is due for a pullback, but no point in fighting euphoria at this point.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish trend being challenged

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.

Elliott Wave Stock Market Update - October 29

The market started to pullback today after finding a top at 1991. It is still too early to tell what sort of corrective waves are coming, but if the wave from 1991>1969 is a bearish W1 of an A, then the target is about 1945 or around the TA. However, if this is a simple ABC, then we're looking at 1960 as the end of a short term correction. I think it'd be better for the bullish case to make a stronger pullback to 1925, as sustainable rallies usually come after a good dose of fear. And now that QE is officially over and there is no sign of further QEs, maybe those traders who believe this market will crash because of the end of QE will start selling tomorrow? technically speaking, they should have started selling as soon as the news came out but maybe they're confused. I am glad the whole QE thing has been put to rest, as we will now find out if this policy was truly effective. If things are as stable as they seem, Bernanke will go down in history as an economic genius who saved the US from a depression. And he should get credit for it, given all the criticism he received during his tenure. I personally thank him or my cheap mortgage rates, we might not see rates this low again in decades.

Anyway, I will be lowering my stops to break even if the market goes below the 50 DMA and hopefully closing position at a profit on the TA test or at 1925.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish trend being challenged

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.

Elliott Wave Stock Market Update - October 28

The market has continued to rally as expected and has now reached and surpassed the Inverse Head and Shoulders target of 1978, first posted almost 2 weeks ago when the market was at 1880's. At that time the IHS target seemed like long stretch given all the fear about Ebola, QE, Oil, Europe, etc. And this rally is a reminder of why objective technical analysis is a better predictor of market behavior.

Now that the structure seems complete, I favor a top in the next few sessions and then a drop to test the Trend Average or better yet the 1925 level. However, if 1986 is broken then the next stop will likely be 1999 and in turn raise the target bottom to about 1950 (Assuming the market is about to put in a big IHS to much higher highs). But if this rally has been a B wave, then we should see the 1821 low tested. I went short to hedge my longs as planned and will be covering on the pullback to the TA or sell my longs if people get overly bullish past 2000.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish trend being challenged

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.

Elliott Wave Stock Market Update - October 27

The market didn't do much today other than reset short term overbought oscillators to neutral. There is also a short term triangle pattern in place which should result in higher prices and possibly challenge the 1970-78 area. So my plan is still the same, if the market gets there then I will be shorting to hedge, or wait for a pullback to the Trend Average/1925 to add longs. November is coming up and the market might start to position itself for the usual December rally.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 24

The market refused to pullback today and instead it went for a test of the 50 DMA and it is now very close to its 1970-1977 resistance level, which is within range of the second Inverse and Shoulders target posted early in the rally. If the market intends to rally for the rest of the year, we might see the market put in a neckline around these levels and pullback to 1925 and then mount a huge rally to 2120 more or less on yet another IHS. I am sure some people will find it hard to believe it, but the technical background supports it. The requisite for this potential rally is the recapture of the Medium Term Trend. If the market fails to hold the 1925 support level and most importantly the 200 DMA on the coming pullback, then we will probably get what will most likely be a C wave to test the 1821 low.  Looking at the fundamental picture and some of the media headlines, the issues that were a problem a few day or weeks ago (when the correction started) like Ebola, Russia, oil, and Europe seem to have been sidelined. But the bottom line remains, Europe is near zero growth which might prompt them to do their own version of QE. The US and China continue to grow substantially, adding between only these two countries $1.5-1.7 trillion worth of GDP this year alone. So the background picture favor the bulls in the intermediate term. The only factor that I see favoring bears is the market might need more time to consolidate gains from the last 2 years.

I am going to short to hedge at resistance if the market gets there or add longs at the 1925 level/Test of the TA, which ever comes first.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 23

The 1925 level was not breached and as I expected the market continued to rally towards the 50 DMA, making a high at 1961 before reversing some of its gains. Technically speaking, we can call the entire structure complete at this point since there are 5 waves in place. But this last leg could extend to 2015 if it subdivides into 5 waves or a bit lower if it goes into an Ending Diagonal pattern. Also, since it is short term overbought at this point, a pullback to test the Trend Average to consolidate gains and then go towards new all time highs looks very possible.

I missed the chance again the chance to add longs (should have done it yesterday) since the market gapped up. But I'll add longs if we get that TA test or go short to hedge if we get more upside, specially a micro 5 count/ending diagonal. The financial media seems to have forgotten all the scary issues from last week after a 140 point rally. But once they start justifying the current rally with whatever reason they come up with next, it will be time to be cautious on longs. It's obvious by now the media is always once step behind.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 22

The market took a break today on what seem like a W4, so I'm assuming there will be a Zig Zag or a Triangle before another bullish wave to a higher high. It would be good if the market corrected all the way to 1912 (so I can add longs), but 1925 would have to break first which is questionable at this point. Some people are worried about oil again as it has set new lows, but I think it will ultimately test $77 as I've been projecting for over a month before oil was on the radar. And again imo, lower oil prices just means more money for people to spend. Lastly, the Trend Average has now turned bullish and the daily MACD has made a bullish crossover so new highs are a probability in the coming weeks if the TA and the 200 DMA holds.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 21

The market has comfortably reached the first Inverse Head and Shoulder's target of 1924 and it looks like it is going for the second target of 1978. And now that 1926 was taken out and the market trades substantially above the 200 DMA and the Trend Average, we can now see that 1821 was an important bottom. And despite the 100+ points rally from the bottom, the daily MACD has not ever made a bullish cross so this could easily be the start of a bullish wave that will go to substantially higher highs. With that said, this bounce to this level could still be a B at the intermediate level and then see a C wave that will test the 1821 low. But as it is, there is an ABC pattern to 1821 from the top.

Now that the environment has turned bullish, I am starting to see new reasons on the media of why the market is rallying. But the real reason imo that nobody talks about is the market had been correcting for almost a month already and bears had been running out of time to make their case. And as I've stated many times in the past few years and during each one of the corrections, as long as the economy is growing, there will be profits and that will keep the market going up. It's interesting to see how people are gripped by what I think is irrational fear every single time there is a correction. Then again, if we didn't have scared people running around, there wouldn't be a market.

I missed my chance to add more longs this morning as the market was way above my target buy range by the time I woke up. But I have the longs from yesterday and I am now looking at the 50 DMA/resistance to go hedge longs.

We will be making trade recommendations this weekend on the EWA site. For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish trend being challenged
Medium Term Trend = Bearish

Long Term Trend = Bullish trend being challenged

* 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.

Elliott Wave Stock Market Update - October 20

The market was able to break above the 1898 resistance and closed just below the 200 DMA. The short term oscillators are overbought, so we could get a pullback to support before another bullish attempt on the 200 DMA. The market closed over the Trend Average, but since it is down sloping, I think it will take couple of bullish closes to turn the trend bullish. For now, the market looks stable but the real test will come at the pullback. The level I am paying attention to is 1877, if that holds then I think the market could get very bullish. I went partially long today on China shares and might add SP500 on a pullback using 1877 as the stop.

We will be making trade recommendations this weekend on the EWA site. For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish trend being challenged
Medium Term Trend = Bearish

Long Term Trend = Bullish trend being challenged

* 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.

Elliott Wave Stock Market Update - October 17

The bulls were able to regain some territory again today and so far it looks like the market wants to go for the IHS posted yesterday. However, another formed today (which is a bit easier to trade) that targets 1978.  Given how oversold the market has been, I wouldn't be surprised to see this high target met. The resistance levels are clear if the market breaks out, there are 1912, 1935, 1970. So I will hopefully buy on a break of 1898 and trade the IHS keeping in mind the resistance levels and the 200 DMA/TA. Now, the market can still be in a W4 wave and prices could go up to 1925 and still keep the bearish 5 count valid but that is not looking likely so far. Yellen hasn't given any hints of what the Feds intend to do yet, but I suppose if they delay tapering then it will be used as an excuse to continue the rally. In the overall scheme of things, earnings is what will support the market and that's technically what people should be focusing on.  And so far reported earnings are looking good.

Have a great weekend!

We will be making trade recommendations this weekend on the EWA site. For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish
Medium Term Trend = Bearish

Long Term Trend = Bullish trend being challenged

* 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.

Elliott Wave Stock Market Update - October 16

We had a much less volatile market today and there is even an IHS targeting 1924. However, we could still see one last leg down to test the 1814 area, so the market is not out of the woods yet. If the market breaks out tomorrow in a bullish W3 then that could signal a bottom for the entire correction, but it's best to be cautious given the manic depressive mood of the markets. I am on the sidelines but might consider trading that IHS if it materializes.

Also, per my post yesterday:

So the second there is even a suspicion of anything that might affect profits, you will have smart people in charge of economic policy make sure those profits keep coming in. A good economy for a government is not a luxury, it's a matter of self preservation. 

There are now "surprise" rumors about a continued QE program given the potential deflationary pressures on the US economy. So all eyes will be on Yellen on Friday to see if there are any signals that confirms the rumor. And again, contrary to some of the headlines of a "Hand out from the Feds" to the markets, this is an issue of making sure the economy keeps growing so those profits keep coming in so they can be taxed! What I posted about yesterday was not meant to be critical of the government, it was meant to point out why the way government works favors people who invest in business assets. To be very specific about what I am talking about, of $1 in profits generated by a public corporation, 35 cents goes to the Fed government in taxes, which leaves 65 cents. Out of that 65 cents, it gets taxed again when it gets distributed to shareholders at 20% more or less plus in my case (California resident) another 13% in state taxes. So, from $1 of profits generated, close to 60% goes to government! So technically speaking, the government should be interested in the company doing well more than anyone else. In the working world, I can only think of one profession that takes more than 50% for the privilege of doing business. And this of course doesn't include all the other taxes a company generates in income taxes from its employees and all the other etc taxes. So you see, while the government might screw up here and there, it is always watching out for itself as it is a money hungry beast by design. All those bailouts in 2009 were not meant to "Help Wall Street" as the public likes to complain about, those bailouts were meant to keep Cash Cows alive so they can keep producing. And the byproduct is the employment for workers and a general sense that the economy is doing ok. So next time we get another financial crisis and you see the government singling out companies to bail out, the best thing one can do is follow the government money as that might just make you very rich.

We will be making trade recommendations this weekend on the EWA site. For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish
Medium Term Trend = Bearish

Long Term Trend = Bullish trend being challenged

* 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.

Elliott Wave Stock Market Update - October 15

The market really sold off today and has made its intention clear. A few days ago I posted the possibility of an expanded flat pattern or a bearish W3 in the works, but given the market's oversold condition and the fact that the 200 DMA had not been tested, much less broken in 2 years, made me lean towards the expanded flat option. But now that it is clear it was a W3, I can look for other possible bottom targets. As of now, if the market puts in a final 5th wave that equals W1, then we're looking at 1818. There is a very important support level at 1814 that must hold, but if the W3 extends then the next key support at 1738. I was stopped out early morning at a loss and I will just sit it out until I see something worth trading. For the record, I still think the sell off is not a sign of anything serious but part of a consolidation period (LT INT W4). The question is, will the bigger correction be a triangle, zig zag or a flat?

News of Ebola and the "economic slowdown" is the excuse for the correction, but chances are Ebola will be contained (despite inept handling so far) and the world will likely be just fine. Lower oil prices just translates into an economic stimulus everywhere in the world.  And should any country see any real possibility of a slowdown, we will just get more QE or stimulus packages. Something the great majority of people fail to realize is that the number 1 beneficiary of corporate profits is not the shareholder, the CEO, or the company. It is the government. Which double dips with corporate taxes and then dividend taxes and capital gains. In addition to income taxes, payroll taxes, property taxes, sales taxes, etc taxes. So the second there is even a suspicion of anything that might affect profits, you will have smart people in charge of economic policy make sure those profits keep coming in. A good economy for a government is not a luxury, it's a matter of self preservation.

We will be making trade recommendations this weekend on the EWA site. For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish
Medium Term Trend = Bearish

Long Term Trend = Bullish trend being challenged

* 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.

Elliott Wave Stock Market Update - October 14

The market attempted to rally earlier in the morning only to give up most of its gains by the end of the day. There are couple of ways to look at the waves, but it seems like the bearish structure is trying to find a bottom given all the overlapping waves. It will be interesting to see what the market does once it reaches the Trend Average, which has now fallen to 1929. If the market can turn the TA around, there's a very good chance the 50 DMA will be the next trendline to be tested.  Also, I am posting the monthly chart, which I don't think I have updated since last year. If that long term count is correct, we should see a shallow correction (relative to the huge rally since late 2012) and then finish the W3 of W3, so technically there's still a long way to go. Lastly, there's a lot of talk about Oil lately and I wrote about this a weeks ago on the EWA site on the levels where it should bottom if mid 80's support broke. At this point, $77 looks like it will be the floor so that might be a trading opportunity once Oil gets close to it and perhaps coincide with an stock rally.

We will be making trade recommendations this weekend on the EWA site. For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 13

The 200 DMA was not able to hold the selling today and an important layer of support in the 1880's was broken as well. From the wave perspective, it looks like the market is trying to find the bottom of an expanded flat (A=1904, B=2019, C = 1974?) or it is selling on some sort of W3. Looking at technical indicators, the market is extremely oversold and is due for a strong bounce or even the start of a new bullish rally. I remember last year around November, when I thought the LT Int W3 had finished, the market was going to test the 200 DMA at the very least to confirm a LT Int W4. But that test never came and perhaps this is the LT Int W4 correction that was supposed to come last year. Which implies this bearish structure will find a bottom and then we will see LT Int W5 to new all time highs. The fundamental picture supports a correction and not a sell off in my opinion and I think the market will be reminded of that now that earnings are going to be reported. The current excuse for the sell off is the possible slowing of worldwide growth, given Germany's exports contracted substantially in last month, which in itself is not a surprise given Russia is one of their main trading partners. However, China just surprised to the upside yesterday on both exports and imports but that went mostly unnoticed. So given the fact the US is growing at or slightly above projections,  China continuing 7%+ growth, I think the whole thing is just an excuse and the markets will stabilize and rally again. I think once Marc Faber or any one of those always bearish "experts" appear on CNBC to scare the public, we will be able to confirm the bottom..lol

I went long early morning after seeing a 30+ point reversal (which I thought was a micro W1) from pre-market lows, but ended up getting stopped at 1880 for a -1% loss. However, I went long again at the close with a stop at the next key support level, so hopefully the market Gods will be kind to me in the next few sessions. Obviously, this is a counter trend trade so I'm looking to sell rallies until key levels are recaptured.


We will be making trade recommendations this weekend on the EWA site. For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Have a great weekend!

Short Term Trend = Bearish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 10

The market failed to find support at 1925 and instead ended up testing the 200 DMA at the end of the day as I had speculated yesterday. However, since the low came at the close, there is a good chance  the low put in ES few weeks ago as the actual bottom for this sell off (1995 cash equivalent more or less). So early next week, I am looking at the 1880-1900 range as the potential bottom and a rallying point for a strong counter rally or sustained multi-week rally. I was really tempted to go long at the close, but I'll take my chances and wait until Monday before committing.  I find the risk/reward at this level is very favorable, specially given where the stop level is.

We will be making trade recommendations this weekend on the EWA site. For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Have a great weekend!

Short Term Trend = Bearish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 9

Another exciting day on Wall Street. The market sold off today just as hard as it rallied yesterday, so now the bulls need to make their case before selling gets out of control. Looking at the chart pattern, if we get a bounce tomorrow that stalls around the Trend Average, then we could be looking at a Descending Triangle with a target of 1875. However, if the selling continues tomorrow, I think there's a very good chance the market will find a bottom at the 200 DMA/1904 support level. Again, a level the market has not seen since late 2012! I ended up getting stopped out of half the longs I had from yesterday in afterhours as it dipped below the equivalent of 1925 cash. But I will be going long again if the market makes it to 1904 on a continued sell off with a short stop.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Short Term Trend = Bearish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 8

The market managed to put in another strong reversal today after putting in a marginally lower low at 1925, but this time the index closed above the Trend Average and you guys know I am all about that number. Obviously, today's bearish action invalidated the IHS option so we need to see if today's low will be re-tested or we will see the start of a new multi-week rally. Bulls need to recapture the 50 DMA at 1973 and stay above it, and bears need to get their act together as their time is basically running out. I went long today per my plan yesterday when I saw the market hesitate at the 1926 level, but I already sold half at test of the Trend Average for a nice profit and raised my stop on the other half to 1925.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Short Term Trend = Bearish trend being challenged
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 7

Bears made their presence felt today by breaking support and selling off towards the end of the day. The bullish 5 wave count I was tracking was invalidated and I replaced the labels with an ABC. If the bearish micro count is correct, we will see 1926 tested at the very least and we might even see the 200 DMA which is at 1904. Furthermore, the Intermediate Trend has turned clearly bearish with today's close so it is time to be cautious with longs. I got stopped out of my other half of the long position at 1949 at break even, but I am expecting a tradeable bounce if the market gets to 1904 or even 1926 if the selling exhausts around that level. And as I've been saying in the last few days, the market is technically ready to start a substantial rally given the oversold conditions. If the market fails to start a strong counter rally, then perhaps it is time to start expecting a "real" correction of 10% or more.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Short Term Trend = Bearish
Medium Term Trend = Bearish

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.

Elliott Wave Stock Market Update - October 6

Sorry for the late update, I had another busy day today. The market tested its 50 DMA as I had been expecting and now we have another Inverse Head and Shoulders targeting new all time highs at 2037. And while the trend is bearish and the intermediate trend is about to turn bearish, there's a good chance the IHS will materialize given the oversold conditions and last week's strong reversal day. Obviously, a corrective wave can not go under 1926 and I'd like to see the market recapture the 50 DMA and the Trend Average in the next session or two to confirm a new rally. If the bears fail to gain control this week, I think they will have to wait again for a while before another chance. I ended up taking half profit on my longs and I am keeping the other half with stops raised to break even (1949).

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Short Term Trend = Bearish
Medium Term Trend = Bullish trend being challenged

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.

Elliott Wave Stock Market Update - October 3

The potential bearish 5 wave count was invalidated at 1964 and the Trend Avg/50 DMA was almost tested with today's high. If the market is able to continue the rally next week, we might see the start of another multi-week bullish wave. The 200 DMA is at 1902 and the market might again be able to avoid a test, as it has in the last 2 years. Which in itself, is just a normal correction within a bull market but people just keep buying all the minor dips. I didn't sell my longs since the market has not reached my trading target, but I raised my stops to a little above break even.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Short Term Trend = Bearish
Medium Term Trend = Bullish trend being challenged

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.

Elliott Wave Stock Market Update - October 2

I had a busy day today, but I finally had the chance to update. Basically, the market found the 1928 level significant and reversed all its loses by the end of the day. Whenever we get substantial reversals like the one today, there is a good chance a bottom has a found. The level that would confirm a bottom (short term or intermediate?) is the break of 1964 resistance, if the market follows through tomorrow and overcomes that level then there is a very good chance the TA or the 50 DMA at 1975 is next. And as I wrote yesterday, every single time the market has been this oversold in the last two years, we've seen rallies to new all time highs. Will this time be different? I went long today with stops at today's low and looking at the 50 DMA as the first target.

- I forgot to add. If 1926>52 is a W1, then expect  1986 to be challenged again. -

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Short Term Trend = Bearish
Medium Term Trend = Bulliss trend being challenged

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.

Elliott Wave Stock Market Update - October 1

The market finally made a decisive move to the downside and key support was easily taken out. The next support levels are 1942 and 1928, but I think there is a good chance this wave will ultimately test 1904 and possibly start a strong counter rally from there. A test of 1904 or the 200 DMA (currently at 1900) would form a neckline for yet another Head and Shoulders, so we'll see if bears can finally get it done. Still, this market has been in correction mode for a while now and we could see a strong bullish rally given how oversold the market is. The market has rallied every single time the daily MACD has been oversold (7 occasions since Nov 2012) and there hasn't been a single test of the 200 DMA in almost 2 years! Maybe now that there is a case of Ebola, things will be different? I am staying on the sidelines until I see a test of the 200 DMA or if we get a potential bullish pattern.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com

Short Term Trend = Bearish
Medium Term Trend = Bulliss trend being challenged

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.