24 Sept 2015 - Lock Step

Yesterdays post was accidentally saved instead of being posted, so it was posted earlier this morning.  The analysis from that post was as good as it gets. Early morning we had a push lower to complete what shows to be a 5 wave pattern in the intra-day chart.  Prices also rebounded this afternoon to close right near yesterdays closing level which I also said would be most likely be the case ( a range bound) few days for price.  This move back to the 4th wave is nothing new to EW analysts, but again this is in favour of a completed 5 wave pattern.

The issue now is to determine if the corrective wave for a wave 2 up is over or that the low today was a wave 2 bullish count (not labelled on chart).  I did not label this on the chart due to us concentrating on the bearish trends due to bearish sentiments, but we cannot eliminate these possibilities.  Since we are now at a critical point, we can have two things happen.

Bullish scenario would have the count change from Pink b wave to a, and Pink c wave to b.  The low today will then be called c-wave for 2.  While the bearish is labelled on the chart below.  An impulsive move tomorrow will do quite a few damages if this is a 3rd wave push higher as 3rd waves are most impulsive, while a bearish 3rd wave would also do the same, but on a downside bias.

While yesterdays positive divergence was negated, today's positive divergence was not, and we got a subsequent rally out of it.  We should look for indicators in the intra-day to show us the way tomorrow.  Any OB / OS condition tomorrow will be the dominant factor in my views.  If we are indeed starting a Green 3rd wave, it wont be a surprise that waves at this point could be hidden and not fully viewed by the naked eye as it gaps or accelerates down.

We should still remain on a bearish mentality because we are at an advantage to stay with trend.  Someone asked me if we could see a possible black Friday.  Well based on a wave 3 push lower we could, but we cannot use EW alone to decipher a fallout.  So far with today's move we are still in SYNC with the bearish sentiment and it becomes a high probability.

SEN: Bearish
ST: DOWN
PA: DOWN