All the markets “GAP Opened” higher today, with the NDX marching directly to the 1446 level before finding the resistance I discussed on Saturday. The actual inter-day HIGH was 1445.82.
There is a very clear channel developing from the January 20th HIGH in the NDX which suggests that the correction conducted over that last four (4) trading days is Higher Degree Wave 4. In Saturday’s Update this was identified as “NDX Alternate Wave Count II”. The corrective wave structure of the Wave 4 looks a bit impulsive (possible Wave-a of lesser degree) and a bit short on time. So we could get a decline tomorrow to the 1398 level tomorrow, followed by a retest of 1446 later in the week.
However today is the forty-eight (48) trading day since the HIGH made on January 20th in the NDX. So the “probability” is HIGH that the NDX continues its decline directly from this 1446 and lasts seven (7) trading days; for a total of fifty-five (55) FIB trading days from the HIGH made on January 20th. Interestingly, that would put the LOW for this first Impluse Wave (identified as Wave 1 in the NDX) to arrive on or about April 7th; which is the Wednesday before the week of Option Expiration, the favorite inflection point created by the “boys”.
If this is the correct interpretation of the wave count in the NDX, the LOW on or about April 7th in the NDX will be around 1346. Note also that 1346 is also the bottom of the Larger Channel that has contained this entire rally, in the NDX, since the LOW in October of 2002. So hitting the bottom of this very important channel, as the wave structure completes five waves, should set the stage for a significant rally that corrects the entire decline from the January 20th high in the NDX.
I am keeping my STOP LOSS in the NDX at 1461. A violation of 1461, to the upside, on the NDX would force a Fund Exchange from the current RYVNX position (since 1/08/04) to RYVYX
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