After a relentless month of selling, the SP has hit the .618 retrace of the Summer rally. This is where it needs to bounce. Fibonacci resistance at 1405 for a correction. click to enlarge Note the "Y" wave has now been retraced Fibonacci .382 on the Weekly chart below. Weekly INDU Weekly click to enlarge The Dow has already taken out the .618 retrace of the last little 'c' wave up. It is now at the .382 retrace of the "Y". If there is to be another iteration of the corrective structure up up toward 14000 this is where it needs to show up. Note the last "W" corrected Fib. .382. The RSI negative divergence and of course the long term trend line breakdown suggests its's not going to squeeze out another move to new highs but ... if it were get a Z wave , it would equal .618 of the Y wave @ 14,277. Check out the RSI. C=A down at 5950
Showing posts from November, 2012
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Please take a moment to check out the previous posts beginning with the last one of Oct.9; Natural Gas Target Update " The Y will equal the W at 3.96. The 50% retrace of 6.11 to 1.90 hits at 4.01. The 4.00 area is really the hurdle both technically and of course fundamentally, and for that reason is begging to be tested. So another short term pullback or consolidation that retests the break out should be seen as an opportunity. (that would have been 3.29, it only made 3.33) Y = 1.382 of W at 4.48 also the .618 retrace of 6.11 to 1.90 Y = 1.62 of W at 4.81 " Since the April 19 post, Natural Gas Hits Long Term Target , Natty has had a 100% move. As can be seen below there is some Fibonacci resistance right here at 3.83, and of course just overhead at the 4.00 area (Y=W @ 3.96, 50% retrace 6.11 to 1.90) . The entire ABC down from 15.78 is retraced a Fibonacci .146 at 3.92 Also the late autumn seasonal high for Natty over avg 20 years is late Nov.
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Is this the genuine article, the resumption of the Grand Super Cycle correction down? Finally? The high made by the SPX at 1474.50 is mighty close to the measured targets of 1478 and 1487 discussed in the previous post, SPX Elliott Wave Update, Alert, and Targets from Oct.19. And that IS the most important consideration. Check out the chart from the Oct 19. post; click to enlarge The .618 Fibonacci relationship of each successive leg to the preceding leg is obvious and telling. During the run up from 1993 to 2000 each successive leg was Fibonacci 1.618 of the preceding leg (thats a bull). ...However... (there's always a few qualifiers) Daily click to enlarge The move off the very highs does not really count well as an impulse wave. Yet. It also left a number of potential continuations of the abc structure up unexplored, as well as not quite tagging the 1478 to 1487 area (not strictly required by any means). In any case, remaining open minded about th