E-Wave for the S&P 500 Index

[RCKS]

Pretzel update:
http://www.pretzelcharts.com/

This was posted at 7:34pm Aug 6th

"Word out here in Maui is that we may be facing one or possibly two (yes, two) hurricanes (and/or tropical storms), which are due to make landfall sometime tomorrow.

So, depending how that goes, there may not be another update until next week, since I may or may not have the following things after the storm hits:

1. Internet.
2. Power.
3. Use of my limbs.

It's also possible that I'll have all of those things, but will be stuck cleaning up masses of debris and floodwater. Last I heard, we're supposed to get 8-10 inches of rain; and rain is one of the main causes of these islands eroding into the sea (and eventually disappearing completely) over time. So massive rain storms tend to damage our infrastructure.

Anyway, wish us luck!

And good luck out there in the market. Trade safe."

This was posted 2:52am August 6th

"Last update expected a fourth wave bounce, followed by new lows, and that's exactly what's happened since. The market is now approaching an inflection zone, and things get more complex and become less predictable inside inflection zones. Major turns can happen in inflection zones, or accelerations of trend can happen if inflection zones fail. The one thing that's almost always guaranteed inside an inflection zone is that the market will try to confuse and veil its next move.

Let's start with the long-term INDU chart. INDU has reached my next target zone, but still appears pointed lower, at least for the near-term."



A closer look below:



"This is where things can be a little dangerous for novice traders. Choose your battles very carefully here. Instead of trying to find a new way to say the same thing, I'm just going to refer back to a few things I wrote on Monday:

"...waterfall declines do not lend themselves to the anticipation or projection of bounces -- they lend themselves to trend following. C-waves are third waves -- and being early on third waves is not unlike trying to snag pennies off a railroad track in front of a speeding freight train...

Longer-term, I currently expect this decline is likely to resolve with new highs. But part of the value of Elliott Wave comes not just from anticipation, but from understanding the market's position in the wave structure, and thus knowing when not to attempt anticipation. Since I know we're in a third wave decline, and I know third waves are powerful waves that crush traders who jump in on the wrong side too early, I'll be watching for signs of base-building as the signal to flip long."

That, of course, doesn't mean I won't take a stab at trying to anticipate a bottom -- but I will choose my battles very carefully, and I will honor my stops. And I will remember that I can't be both long and short at the same time -- so every attempt at a long that gets stopped represents not only money lost, but money I could have earned had I stayed short and followed the trend.

So, with caveats in place, the two-hour SPX chart:"



And the 30-minute SPX chart:



"In conclusion, things are now as complex as they've been in a while: We have enough waves in place for a complete C-wave decline, yet we have no signs that the trend is over.

In a perfect world, over the near-term, I would like to see at least two more new lows (micro fourth and fifth wave unwinds). So near-term, the waves still look pointed downwards, which means I have no confirmation to call an end to Wave C yet -- and for all I know, the wave could extend. In other words, if it reaches the next target zone, that doesn't necessarily mean it's over.

This is a session-by-session market right now, which means that the results of only one session could turn everything either very bullish, or even more bearish. The good news is that we will most likely recognize that moment when it comes. Trade safe."

Follow me on Twitter while I try to figure out exactly how to make practical use of Twitter:
@PretzelLogic