Elliott Wave Stock Market Update - January 13

Today's wild price swings eliminated the bearish count I had posted yesterday. And while the short term trend and the intermediate trend are both bearish, the action today was actually on the bullish side despite the negative close. The SP500 looks like it could be setting itself up for a bearish W3, however all the major indexes (DJIA, COMP, RUT) had higher highs early in the morning and that eliminated the possibility of a 5 wave bearish count. And you just can't have a bearish W3 on one market while having something else on the others. The most likely intermediate term count at this point is this being a W2 correction as long as 1992 holds. Lastly, looking at the daily chart one could argue for a triangle, so I am not betting on the short side until the count is resolved.

I remain long in China shares and oil. Obviously, nobody really knows how the supply problem will resolve itself in the short term, but the waves are calling for a bounce so hopefully oil will bounce to $50+ in the near term. Technically speaking, oil is now more oversold than at the 2009 low, so we could see a violent spike soon.

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 whipsaw