S&P 500 Elliott Wave Analysis

This entry was posted by Wednesday, 5 January, 2011

S&P 500 Elliott Wave Analysis updated from 28Dec

We are counting the S&P 500 as having completed 5 waves from the July low. There are a number of larger degree elliott wave counts possible and we will take a closer look at them if the short term analysis starts to break some key supports and confirms the count.

First of all lets take a look back at the updated kid-with-a-ruler inverted chart…

s&p 500 trend line analysisS&P 500 Trend Line Analysis

“Would you buy this stock” yet? It seems like a very long time since the kid-with-a-ruler first asked that question and the market has continued to follow its trend ‘down’ leaving many traders wondering why they didn’t just go with the trend. The big question is, have we had capitulation yet?

It shows exactly why we often invert the chart as part of our trend line analysis as a means of removing ‘bias’.

That last pop may have just been  enough but it is still possible that we are now in an Elliott fourth wave.

S&P 500 elliott wave analysisS&P 500 Elliott Wave Analysis – Medium Term

The medium term Elliott Wave analysis chart we have been following shows the 5 waves from the July low.

S&P 500 elliott wave analysisS&P 500 Elliott Wave Analysis – Short Term

The short term S&P 500 Elliott Wave analysis chart shows how we are counting the 5 waves within the larger degree 5th wave on the medium term S&P 500 Elliott Wave analysis chart shown above.

It looks the best fit at the moment but we need to see prices take a bit of a dive soon to start confirming this.

If instead, the market is able to hold prices fairly steady up here at bears  struggle to make headway, it would swing the balance of odds and probabilities towards the alternative Elliott Wave count shown by the Grey (iii) on the Short term Elliott Wave analysis chart.

It is possible that the smaller degree 3rd wave has extended much further and has only just completed here.

This is the Alternative count. Our preferred wave count is the Blue v, but lets see what it does.

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