ajtj99's Market Pulse

[Culmus]

The outlook for yesterday was bullish under one condition, the NDX had to realize high momentum on the long side. While the NDX looked up and reached the intermediate target of 1629, high trend dynamics were clearly missing. The daily target at 1647+ was not reached.

Even though tere were bullish impulse patterns in principle chances for further gains to 1647+ and later 1659 have dimished as in an impulse count the rise of Monday and Tuesday has to be counted as main thrust wave 3'. In principle this is still possible as there was no wave overlap so far. The missing extension as well as the low trend dynamics hint at a corrective count however.

The main difference is that in case of a correction the NDX can still gain to 1640 but latest there a multi-day bear move starts that brgings losses to at least 1603. A pre-mature start of that correction is possible if in todays early trading the 1621 level is broken.

In order to still realize the bullish scenario of a main thrust wave 3' the NDX would have to rise from the start today within subwave v' of 3', ideally by gapping up. Within a few hours the NDX would have to climb to 1647+. Only in that case the favored down move in the second half of the week is neutralized.

For todays trading the most likely scenario is a sideways move in the first half of trading. Here the subwave v' of c'' should be built which leads to a top between 1633 and 1640. In the second half of trading the index turns down again. Whether already today there will be a wave overlap at 1621 remains open.

Conclusion:

Even if it sounds paradox: Yesterdays gains have diminished the short term upside significantly. That results from the price patterns and the low trend dynamics. Only a very strong open with gap can safe the situation. Otherwise losses have to be expected in the second half of trading after a sideways move.