Market Update - 2/11/2010

My alternate count on the Dow played out almost perfectly today. Yesterday I said we could have one more move up to somewhere around 10150 on the Dow. We hit 10161.

The triple zigzag is probably over now. In terms of price, we have retraced nearly 61.8% on the SPX. The Dow broke slightly above its 61.8% Fib retracement. Time wise, wave (ii) has lasted about 4 and a half days, while wave (i) was 2 and a half days. Time wise, it should be over. And price wise, it has very little room left to the upside before we start getting some major overlap.

So if you look at it that way, today should have been the top. We basically need to be down a convincing amount tomorrow to confirm this wave count.

Here is the SPX count so far:

We did breach the channel by a little bit, but we did hold support at 1080, which was a more significant level.

Here is a closer look on the Dow.

The topping pattern looks a lot like the one we had for wave [ii]. Ovbiously, wave minuette (ii) is just a smaller version of minute wave [ii]. So the topping pattern should be similar.

The 1060 level is the number to break on the downside. Breaking back below 1060 will lead to more downside. For the upside, 1080 needs to continue to hold. But there is also key resistance around 1085.

Tomorrow should be interesing!