Elliott Wave Stock Market Update - February 6

Bulls managed to solidify their case by breaking the 2064 resistance and making a higher high for the structure that started at 1980. This makes it a 92 point advance and leaves the market just couple of percentage points from the all time high. We should see a correction as soon as Monday, possibly to the 2025-2030 area but we still have to keep in mind the possibility of a melt up in the stand alone W3 scenario I mentioned yesterday. The bottom line is bears had an opportunity to bring down the market in the past 4 weeks but prices are still above the 50 DMA. And now that oscillators have reset, odds favor sentiment swinging towards the bullish side. What bulls need at this time is a good excuse to rally.

I ended up stopping out of my USO on my raised stop limit for a nice profit. There was a micro count that ended up being overlapping, so I am ok with locking in my profits and not stress about it over the weekend. We should find out soon if the current bounce in oil is a zig zag (which implies another bearish leg) or the beginning of a much bigger bounce. I hope we see another low so I can buy cheap again.

Have a great weekend!

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 whipsaw