5 Apr 2013

There was a very impulsive drop today but it has only produced a 3 wave pattern and since then we have had a fairly good rally to the upside.  We have breached a wave 1 violation to make it a 3 wave pattern, but another count could have this in a 1-2 count from yesterdays close but unlikely.  Just throwing the possibilities out there that's all.

The support today on the SPX lines up with the A = C rule of EW. As you can see at the bottom chart our forecasting lines were close to dead-on.  On a cycle basis, we have a turning point on April 8th brought on by a Astro Analysis of Mars 36 Degrees.  Anyone looking at these analysis should expect a reversal, but it will depend on Mondays move as to which direction the impulsive goes.

Our analysis of our indicators still says that mid-term trend is still to the downside no matter what the EW pattern says.  Our daily Stoch. indicator is resting on the midline trending downward with the chart sporting a reversal candle.  On top of that the tail end of todays bar has pierced the lower BB line which could possibly line up for a move higher.

Therefore the way to trade this would be to follow the daily Stoch. for a cross up and to exit with your short position then. and wait for a cross back down to short again unless your mid-term trend reverses to the upside as well.  In which case you would trade to the upside.

A Bearish case would continue to look like this chart posted on Apr. 3rd.

Just to note for those following the Canadian Markets.  The TSX proved to be supported on a 200ma Daily Chart.  It would give a good indication that there is a high probability of a bounce.  With the Daily chart being in oversold all we need to confirm this is if the indicator crosses up to sustain a daily to a weekly rally.