Weekend Update

One small change for the Alphahorn Swing System as Gold is on a buy/long Alert and needs a print above Thursday’s high of GLD $118.26 to confirm. Real Estate remains the only long/buy signal, though it is on a sell/short Alert.

The 30 min chart shows the favorite count that an impulsive leg down is likely underway.  Now I’m showing a couple of counts though the projected low is the same for both.  The difference is whether the low will end the correction, is this leg down intermediate wave (C), or will the low only be intermediate wave (A) of what will be a triangle a much longer in duration correction via a triangle.spx 30Below is the daily Renko chart for the SPX, which so accurately predicted the primary wave [3] via its negative divergence.  I would expect the opposite to be true as either primary wave [4] concludes or  intermediate wave (A) under the triangle count, i.e. positive divergence to build.  As for now, there is none.renkoMy daily SPX chart perfectly pegged the minor wave 3 of intermediate wave (3) of primary wave [3] top as my indicators peaked.  From that point it has been a steady build of negative divergence.  And, now the indicator at the very bottom has my attention as I expect it to reach the oversold region as it last did in Aug/Sep of 2011 before primary wave [4] reaches its low point.spx dailyMy Dow daily chart also predicted at the very least an intermediate term top.  Not only did it display similar negative divergence, but my MACD also traced out a perfect ending diagonal.  It as well as the other indicators on this chart should reach key oversold levels over the coming weeks.dow dailyThe next target for the NASDAQ is the blue trendline, but I’m expecting to break through that and test the lower red channel line at the level of the wave 4s of lesser degrees.   You can see that its indicators have also broken down from overbought levels and have a considerable way to go before they reach oversold levels.  compq dailyThe Russell along with the Real Estate index have been leading the charge and should be the first to find support.  It has already tested and broken below its wave 4s of lesser degree and now has the lower price channel trend line in its sight.  I have have it labeled as a zig zag, but considering how much further the other indexes have to go we would probably need to see either a bit of a flash crash for them or a triangle forming for the RUT.rut daily

In the absence of a crystal ball, my best guess is we’ll see a triangle form for the Russell and perhaps Real Estate while the other equity indexes form more simple zig zags or flats.

About alphahorn

I received an MBA from Columbia University’s Graduate School of Business in New York and am a Wall Street veteran. I’ve worked for a number of investment banks including Smith Barney and First Boston/C S First Boston in New York. Over the years, I have developed my own Proprietary Swing System and I combine that System with my own Elliott Wave Analysis to trade.
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