ChartsEdge map for 1/13

Thanks again to Mike Korell and his ChartsEdge forecasting - here's today's intraday BP map from ChartsEdge Daily Maps (remember, their Pattern Recognition intraday map for today is at their subscriber site). Their two types of intraday cycle forecast maps, plus their weekly cycle forecasts (use "ChartsEdge weekly" label most days - gain predictive power when they all look similar - follow links on their site for details, and much of that info is also posted at my NB3 blogspot - links above and at right). Today there are some differences especially in the afternoon.

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ChartsEdge Daily Charts

Posted: January 13th, 2010 | Author: Mike Korell | Filed under:One-Day Market Map | No Comments »

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Thanks once again, Mike and ChartsEdge! Folks, you know how it is - once the crowd gets onto an idea, they run it to an extreme until it's time to go contrary to the crowd. Then things change until the same thing happens in the other direction. At this point you don't care too much unless you're trying to sell top tick, buy bottom tick, or very short-term trading. We don't recommend trying to have to do those first two (drive yourself crazy unnecessarily - better to trade confirmed setups! - numbers are used as alerts!). But the latter is what a lot of traders are doing. Yesterday we saw the SPX go deeper than my expected retest of 1137, past 1133/1134, and down to poke just under 1132. No harm, only changes my thinking about wave structure and counts - which frankly makes sense because the EDT wedge idea only fit the assumption of the rally stopping real soon. While we've been working with the newer strategy in which it'll only take a break.

If you read Terry Laundry's updates including the one this morning, you know he allows for the SPX to fall short of the 1161+ projection, but then have only a mild pullback (less than 5%) as it then readies for another move up within the "T" that points to May 9. Trying to translate for Elliotteers, I'd think that suggests the up-wave subdividing. Meaning, more choppiness in a generally upward trend. Or it could go into a different kind of triangle.

That also suggests, if you're selling into time rather than awaiting a sale into price (whether 1161 or whatever his upper envelope prices whenever it touches up to that), you'll start considering dipping in again on an interim pullback. Or hanging in cash and going on an early spring break, depends on your style!

At this point, yesterday's pullback level should hold or otherwise the market would be expected to test deeper. The 1114 level would really break open the wave count and likely cause a real stir. Otherwise, the most probable path is that the market will chop higher. If there's a chance it can make the rise into this past Monday a w1 of 5 (yes, I'm rolling my eyes), then we could see a further extension up into Friday or next Monday, and then concluding wave into the 21st. It's possible.

Do keep and eye on the banks and financials. If they rebound then equities should get more steam; if they further consolidate, that's probably a sign equities will too. Meanwhile we've got the dollar weakening as if on cue, though will have to see if commodities "buy that story" by rebounding, or not. So - careful as always out there; and happy market navigating!