10 Apr 2015 - Pushing The Limit?

As we enter earnings season, we are greeted with accelerating prices.  I gather we are nearing an extreme in the current move which should end soon.  I still consider the price action as corrective, and this does not mean that price cannot make a higher high surpassing the highs made in Late Feb. in the SPX (Early Mar. for Dow).  If we do make a higher high then a push lower will just be part of a bigger corrective pattern which will eventually result in another move to higher highs.  This scenario will eliminate the wave (ii) green labelled on the chart below.  If price can keep below the previous ATH then wave (ii) green or 2 red is still a high possibility along with the abc corrective scenario.

Confused yet?  Unfortunately, sub waves occur all the time and there is no telling or confirming until it has passed what the count actually is.  The ST has remained strong to the upside and is still in OB range which called for a high risk of an acceleration up since yesterday.  We could still see higher prices and since we are in OB territory, we should just let it play out until we can see the signals exit OB.

Based on my EW counts, I am speculating that a turn down is near and since I have been labelling the current moves up as second or b - waves, I am expecting an impulsive move lower that can create a wave 3 or c wave.  So keep your stops close in the case you are long.  For now though, the Bulls and longs are safe with the ST and PA agreeing with them.

MT: DOWN
ST: UP
PA: UP