2 Oct 2015 - Erratic

Prices were up and down or the other way around, but it doesn't matter.  The fact here is that we should distinguish the difference in volatility from erratic behavior.  The only time I see reversals to green from red or visa-versa was when markets were melting down during the 2000 and 2008 crisis.

Perhaps this is nothing to be surprised about as the EW model drawn yesterday was looking at possible C-wave move higher or a (ii)-wave that would stop short of the highs made on Sept 25th.  But this latter is at risk of being nullified if we push above 1953 next week.

The ST is still in an UP trend and prices have now broken above both the 75ma and 200ma of the 60min chart.  1990 looks to be a logical stop, but that is just guess work.  2000 SPX would be a target that would make an A=C confirmation.  Based on the past pattern from the Aug. low, they can be counted as 3 wave corrective patterns and this C wave should not be any different.  So while we dabble on EW forms, we should always remember that there are more options out there that can still be considered valid.  We could even retest the 200 day MA.

Since the sentiment is bearish I will treat the price action as corrective up trend until the sentiment changes.

SEN: Bearish
ST: UP
PA: UP