Jef,
At this juncture, I have the market in the C part of wave 2 down that began on Monday's highs. Unfortunately, I don't have a solid projection for this C wave down that I can rely upon yet, but I'm still working on it. The B wave up finished in the globex session last night, so I need to do some more work with those numbers to get a better bead on it. What I am confident of is that wave A took 2 full days, and since C down began just before the open today, I expect this C wave to finish by market close on Friday or near the open on Monday.
The lowest point of this correction could come anytime between now and then, and may have even passed us by already, as the lowest point of a correction is often not the end of the corrective pattern. And the lowest point of individual equities' down move in this correction could come at any moment too. So I'm following that dude's strategy in the movie "Wall Street", where he bought lightly on the way down, then at 18, slammed the door on them. My "18" will be just after Monday's open.
If 1151 SPX does indeed give way on a closing basis today, I would expect a move toward 1126 to 1130. This would test the peak of the double bottom (Identical to move up from July of '96's bottom, the blueprint for this several month move higher that began on June 4th, '98). Plus, this area would give us just past 50% retracement from the beginning of the move to the top of wave 1, a delightful place for corrections to end.
Best Wishes,
David |
