Dow Jones Industrial Average: +203.52 or 0.17% at 10226.94
S&P 500 Index: +23.78 or 2.22% at 1093.08
NASDAQ Composite Index: +41.62 or 1.97% at 2154.06
NYSE Internals: 2549 Advance. 496 Decline.
Certainly a surprise to the upside. But as I said on Friday, if 1074 was to break, we would likely test 1090. We closed at 1093 today.
Although this rally looks strong, none of the wave counts for the major indexes have been broken, except the Dow. The Dow made a new high today, but that was not confirmed with the other indexes. There was no new high for the SPX, Nasdaq, Financials, Dow Transports, Russell 2000, Real Estate Index, Crude Oil and so on. Also there was also no new low for the VIX.
Wave 2 can retrace upto 100% Which would be 1101 on the SPX. Basically tomorrow needs to be a down day. We have virtually no room left to the upside. If we do open up higher, 1101 CANNOT be broken. If it does, we have to delete all the counts and start from scratch. The one flaw of Elliott Wave... Aside from Elliott Wave, we are also extremely overbought in most of the time frames.
Wave 2 appears to be taking a form of a triple zigzag. This is a complicated corrective pattern. It unfolds in waves W-X-Y-X-Z. The W Y Z waves being the zigzag up, the X waves being the triangles or wedges separating the W Y Z waves. Usually all the waves consist of an ABC instead of 1-2-3-4-5.
Going back and looking at the daily charts, all the previous Minute wave [ii]'s have retraced deep into wave [i]. This deep retracement is not uncommon at a start of a new downtrend.
US Dollar was down. Crude Oil and Gold were up. VIX was down. Financials led the upside.
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