Now that ChartsEdge thinks equities not likely to go lower this week - here's their daily map for 7/7 (U.S. equities)

Market Map for Jul07

Posted: July 7th, 2009
Author: Mike Korell
Filed under: One-Day Market Map No Comments »


=============

Thanks once again, Mike and ChartsEdge!

Folks - I hope you all got the news - that ChartsEdge issued a reversal of forecast on their weekly cycle forecast for equities this week. Instead of the idea that Monday would be the high, and movement down after that ... it's the opposite - that the low for the week was yesterday!

Well - it does toss a wrench into swing positions taken yesterday on that basis, so my personal apologies along with my own personal trading adjustments! If you're disappointed - well, I'll admit, I am too, I really kinda did think "that was it" given how ChartsEdge issued that warning a few days ago which we passed along in a post here too. We still need to be vigilant! - the point is, that if this is indeed a Minor wave 3 or a C-wave down, then the wave 2 pullback up does not need to be anything significant. That's why I was willing to believe that it could be finished yesterday - and, why I'm still going to be vigilant about that. Once the wave 2 is done, the wave 3 of the Minor 3 or C down should be more substantial and nothing for which I want to hold long.

If today's daily map works out not only for timing but also levels, and if I want to try switching temporarily from short to long just to catch more of a wave 2 bounce, looks like I'll have to scramble at the open, but also looks like the intraday rise may not be much. But always remember, the ChartsEdge cycles are really to be used for timing, and not for levels (sometimes the levels work out but that's only a bonus). So for myself personally, I'll have to really think about whether I even want to try - I already did edge in long at the lows Monday morning (thanks ChartsEdge for that timing!), before switching - and I have to weigh flip-flopping against being on my toes for the completion of a wave 2....
Yesterday it looked like 895.6 could be an abc symmetry target for a wave 2. Pushed a little past that at the close, but 898 remains a resistance level based on a broken Fib on the way down Thursday. If above 898, then there's the 902-906 (also prior broken support), the 50 dma approx. 909, and the Fib retrace levels below:

Here are Fibonacci retracement levels from the SPX high at 932 Wednesday to yesterday's intraday low of 886.36:
.382 retrace at 903.79
.50 retrace at 909.18 (interestingly close to that 50 dma)
.618 retrace at 914.56 ... so these are levels to watch (in addition to the 50-day moving averages and other MA's and indicators) for any continuation of the move up. If it goes above 915 then it really would be suspect, meaning it would cast some doubt on the current Elliott Wave count hypothesis.

Well folks - as I just twittered, I'm back to my normal approach which is to rely primarily on Elliott Wave, aided by Fibonacci, and just consider the ChartsEdge forecasts in terms of likely timing. And, I posted my own suggestions about a wave 2 up with levels to watch, in my post here after the close. Plus Tony Caldaro has made similar comments in his update after the close (at his Elliott Wave Lives On site, see links at right). The SPX was under its 50-day moving average yesterday, so that will be a widely watched level too - keep an eye on that. If the SPX cannot get above it today, that will dampen more spirits .... yesterday that level was about 909, and one of the EW-based targets I mentioned for a wave 2 up was 906 - so, we'll see!

As always, be careful out there, and happy market navigating!