I think it is now safe to say that the market has indeed topped. Yesterday, I mentioned that if we were to get a down move that broke 1107, and the market was to stay down, there was a good chance that the top could be in. Today was also a pretty strong day in terms of market breadth. Breadth closed 36:1. That is pretty bearish.
As to where we are in the wave count, well we are in wave (i) of [i] of 3. Where exactly in wave (i) is yet to be determined, but my guess is wave iv should start soon.
I think we may chop around sideways. We may get a slightly lower low in between, but I think after a little consolodation, the market should start to drop substaintially again.
However, if the market continues to show a high level of bearishness, we may not have a lot of bounces. So yes, the trend is down. But we may retest 1100 one more time.
The Russell has also broken out of the decending triangle. It was down 4% today.
Watch for the R2K and Dow Transports to lead the way down.
0 comments:
Post a Comment