AAPL update

With the blowout earnings  and the after-market jump in shares, the recent 12% correction becomes a 3 wave affair.

Now I think wave (v) of the advance from Nov 2011 is underway in AAPL. Whether that advance is wave 5 or wave 3 (alt count) remains to be seen. Only a decline below 550 will invite reassessment.

AAPL Longer term count

Dr. Copper looks bearish

Could Dr. Copper be signalling a Chinese hard-landing? Here is a bearish looking chart with a massive Head & Shoulders topping pattern.

A NEoWave Contracting Triangle (A > C > E) with Reverse Alternation (D > B instead of the usual B > D) is shown. 

Alternative counts like a  multi-year Contracting Triangle or Ending Diagonal are also possible.

SPX Update - 2012/04/11

On Tuesday market closed at 1357, the Fibonacci 78.6% retracement of the uptrend from wave 4. Below this level, the Ending Diagonal count to 1440 is no longer favoured. However it can only be eliminated below the wave 4 low at 1340.

SPX's clean break below 1375 suggests that wave (4) may have begun. A backtest and subsequent rejection of the 1375 level will strengthen the case that wave (3) has ended.

Wave (4) can retrace up to 50% of wave (3) to around 1300/1310. More likely it will find support at the wave 4 low of 1340. For alternation with wave (2) it will most likely take the form of a Triangle, Flat or combination.

For clarity, here is the Ending Diagonal count:

Gold & gold stocks update

Gold and Gold Stocks are now seeing extreme investor pessimism & a host of technical data is pointing to an extreme in undervaluation and sentiment. A good update by Pater Tanenbrarum - http://www.acting-man.com/?p=15935

This is not to say we are at an imminent turning point, only that one could be very close. I would be surprised to see Gold staying below the recent low at 1625 for very long. Upside resistance is at 1675, 1700 and then the (red) downtrend channel at 1750.

Previous Update: http://elliottwavecounts.blogspot.co.uk/2012/02/golds-downtrend-channel-asserts-itself.html

SPX update 2012-03-26

I see this correction as the first of 2 significant corrections in the next up-leg of this uncompromisingly bullish market. The uptrend should continue over the next couple of months. SPX has already climbed 300 points since the End of the Panic of 2011. There are a good 40 or 110 SPX points left in this bull market before a significant correction. 

Two project targets for this bull market move are 1440 and 1510. These are based on previous significant support/resistance levels and  Fibonacci Extensions. 

The main scenario has a target of 1510. A wave-count is presented in the SPX futures chart below. In this scenario wave 5 of (3) is extended. The exact internal subdivisions will continue be a uncertain until towards the end of the move. 

In a less bullish scenario the current wave ends in an Ending Diagonal at 1440. This scenario is not shown on the chart. We are already some way through the Ending Diagonal if this is the case. This view is supported by the negative divergence in the RSI. In this view wave 3 of (5) is extended

SPX Update 2012/03/09

Yesterday's rally above 1366 leaves the decline from the wave (3) high as a corrective structure. Crucially, the first wave of the decline stopped at 1339, falling short of the 1337 level required to confirm the end of wave (3). For now this keeps alternate, more bullish counts alive. I will elaborate on those if the market makes new highs in the next couple of days. Overlap with the wave 3 high at 1333 would have eliminated several of these.

For now, I expect resistance at 1375 to continue to contain the advance ... not enough time has passed in wave (4) for the correction to be complete. I tentatively label the first decline to 1339 as sub-wave 'a' of (4). The next few days should produce a choppy overlapping sub-wave 'b' in the 1139-1375 range.

SPX Topping

The Ending Diagonal has one small up-leg remaining that should make a minor high in the 1375- 1380 range. This should be followed by a sharp initial decline that should retrace to the the base of the Ending Diagonal (around 1335 -1340). 

The Ending Diagonal completes wave (3) which began in mid-December. Wave (4) can retrace all the way to 1267. A 1300 target is more likely.

Bonds look ready to rally in the "f" wave of a Diametric. Notice the symmetry in shape between waves "c" and "e" - they appear to be mirror images of each other, suggesting that wave "f" should resemble wave "b"

I am curious to see how Crude Oil will react. A clear inverse Head & Shoulder pattern has established itself that targets $130. 

However if stocks slump  crude could move the other way as well. Resistance is at the top channel line  - that is where I would expect a reaction.