Dow Jones Industrial Average: +51.08 or 0.50% at 10337.05
S&P 500 Index: +4.01 or 0.37% at 1095.95
NASDAQ Composite Index: +10.74 or 0.49% at 2183.73
NYSE Internals: 1646 Advance. 1351 Decline.
US Dollar: -0.27(0.35%) at 76.360 | Crude Oil: -1.78(2.45%) at 70.84
Gold: -12.50(1.09%) at 1130.1 | VIX: -0.94(3.97%) at 22.75
Markets rebound as Dollar backs off.
Exactly what I said yesterday happened today. From yesterday's post: "I think we will make a lower low tomorrow in the lower 1080's. I think 1083 may hold for now. After hitting the lower 1080 range, I think we are going to bounce back up toward the mid-1090's..." Today's low was 1085. We tested the 1083 area and it held up. We later on bounce up towards 1095, sold off again a little bit, then went back up making new highs around 1097 towards the close.
We completed 5 waves down today. Which means at least another 3 up coming our way. I think we will break back above 1100. That 1110 area will most likely be tested again. 1110 is also the upper end of our closing range. If we break above 1110, I think we will get a run back up towards our highs around 1119, and we may perhap make another new high above that. But remember, if we break 1083, the bears may be able to get enough momentum to send us down to the 1060 area.
There is not a lot of big economic data coming out this week besides Trade and Retail sales. With no "noise" in the market, we may finally see some clear waves develop, meaning no interference from the data that comes out. So the key numbers to watch for right now are 1083 and 1060 on the downside, and 1100 and 1110 to the upside.
The bearish count suggests that we completed wave 1 down today, and are in wave 2 up. Wave 2 should take us to around 1103-1108 before selling off again. For the bullish count, we completed Minor Wave B today, and are starting Minor Wave C up to complete Intermediate Wave Z of Primary Wave 2. The target for that is around 1135 for now. We will get a clearer target once more waves start to continue up.
Bearish:
Bullish:
Currently, I don't want to pick a side that I favor more. The market is getting choppy. Just like it does at tops and bottoms. Wave counts get unclear, just like they did at the March lows. So, the bearish count may be wrong because we are not impulsing down. Market breadth is not screaming bearish. But at the same time, we aren't impulsing up either. Price action may be more important than market internals at this stage.
Once again, those pivot points I listed will show us the way. Whatever side we break, will decide which wave structure we will follow.
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