Market Update - 2/8/2010

Choppy day today, as the Dow finally closed back below 10,000. Looks like the sellers finally may have control of the market.

Most of today was bouncing up and down. Seems like a typical corrective wave. The current wave count has us completing subminuette wave b of minuette (ii).

If this wave count plays out, I expect quick move up in the days to come. Perhaps tomorrow? The target is roughly around 1080 for now. This should complete wave (ii), and we should start moving down big in wave (iii) of [iii].

But of course, the market always likes to surprise us, and lately it has been doing that to the downside. So just be careful if we breakdown. On any down move, it will be important to keep an eye on the internals. If we get a trending down day, it could trigger the start of wave (iii). The key level to watch for on the SPX is 1044.

The Dow broke some important support today.

The daily charts look pretty bearish. The next target could be the 200dMA @ 9500.

For the past few days, I have been keeping a close eye on the US Dollar.

According to the current wave count on the UUP, expect a very sharp move up to come in the next few days. It seems that wave ii is close to completing.