Looking at the COMP charts the past 3 days...
On Friday, I was expecting a wave 2 that would retrace down to 2000-2020, but the wave count on Friday is starting to make me think that those levels won't be tested again.
The first call might be right, and we could test 2000-2020, but now that I look at the chart again, Friday was probably a running flat wave 2.
3 waves down, 3 waves up and 5 waves down that don't break Wave A.
Running flats only occur when the direction of the market is decidedly stronger, meaning that the wave up this week could be extended....strong waves up, with very small corrective waves. Extended wave 3's are the most powerful waves around...going up 9 steps. Wave 1 up, Wave 2 down, Wave 3 up, Wave 4 down, Wave 5 up, Wave 6 down, Wave 7 up, Wave 8 down, Wave 9 waaaay up...going up to 2.618-3.618X the original wave of 170 points.
All the pieces are falling into place, it just seems like floods of good news could swamp the market next week, high volume big up days for the large caps could make it on irrationally large rally.
I'm surprised by the small correction on Friday that reversed up, and if this is an indication of the larger trend, the NASDAQ could have one explosive run.
I never knew that short interest was at an all time high (!!!)...can anyone confirm this? I got that information from thestreet.com web site. |
