S&P 500 EOD Review 22 Nov 2011
The bears are still having a break it seems, or have they gone for a holiday? It was a very lacklustre session with minimal moves on either side. Here’s the updated Primary chart.
It appears that it is in a corrective phase in either a triangle or a flat. I prefer the flat as that would bring the S&P 500 higher to 1210 region for a decent relief rally. But as of now, it appears to be in a triangle. If it is indeed a triangle, then, it is in D leg to be followed by E and then a push down to 1153 – 1158 region to complete Subminuette iii.
Alternate View
Alternate view is that this whole down move is Minute [x] and this has ended at 1181 and it in early phase of Minute [y]. If we take a look at the volume and the strength of the move, the volume at Subminuette i was stronger than Subminuette iii. This is abnormal as waves 3 should be the strongest wave in a move with price and volume confirmation. But this is not the case here. Also, notice that the volume has been decreasing for the past few sessions. This indicates that the selling is losing steam.
I would watch the volume for the next few sessions and if it increases on the way up, this alternate view will be promoted.
Fibonacci Confluence
Here’s the updated Fibonacci Confluence chart. S&P 500 tried to break the current band at 1184 – 1187 to the low side but the bulls came to support and turned the bears away. But the bulls were not strong enough though and only managed to push the price up to 1197 from 1181. The bears came in and tried to push it down again but got stopped at the top of the band at 1187. If this band breaks the next level is 1159.
Elliott Wave Analysis 