After Eco data, markets are trading near at pivotal junctures, for Qs 30.80 +/-.
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With VLT "A" correction scenario, the following Qs chart is ending wave 5 -- only if the break to upside is valid which it looks to be with low probability if market reacts very negatively with the Eco news in premarket. In any case, breaking lower support invalidates the scenario.
I noted on the VLT corrective "A" wave scenario which is logical than "C" considering the US economic and financial condition. Furthermore, major market formations suggest that markets are in "A", not "C", and Nasdaq has its own wave pattern.
After the bad Eco news, markets are trading at pivotal juncture, closing above the noted resistances is hopeful and the market action could spark short-covering and buying interest. But, market sentiment is quite bearish. Qs is trading at 30.68. Good luck
Major markets are trading near at pivotal resistances: SPX 850, DOW 8100, Nasdaq 1550, and Qs 30.80 going into the stimulus plan voting. While daily and weekly price momentum is developing to upside, intraday price action is now showing negative divergence. If market sentiment is healthy and bullish, market price actions can move up with strong advance even with negative divergences. That is not the case as market sentiment is quite bearish and edge. Nevertheless, breaking above the noted resistances is quite positive as the resistances are pivotal for further price advancement to SPX 900/1000. Of course, failing to break to upside market will revisit the Nov 2008 low.
SPX ew update ~ I will update on ew analysis and forecast..
SPX daily is showing a breakout from the intermediate term down trend line. The breakout is confirmed by a positive momentum signaled by daily macd. Going into the Friday rally pushed markets to break out from resistances, I alerted positive divergences. SPX has broken above alerted 850, but didn't close above 870 R after trading to 870.75.
SPX shows less strong breakout momentum than Qs and Nasdaq which are showing opening and closing prices are above the ST down trend lines. Since Qs and Nasdaq is leading markets, we can consider market price actions are to upside.
While SPX 60m price actions provide a better signal to a breakout, the daily price action shown below is yet to improve. 60min price action is now getting overbought, however, we had better market trading volumes during the last couple of trading days. SPX closing above 20dma is also positive, yet, as noted earlier, SPX 870 is a strong resistance. Breaking above 870 is, of course, positive that markets will further advance to 900 and to 950. Nevertheless, SPX is approaching a resistance which could change the wave formation to more bearish scenario if it fails to show strength during the next week. Whether we will see "Valentine massacre" is yet to be clued in.
Qs has broken out of the symmetrical formation with a strong advance price formation closing at 31.37 after trading to 31.51 near 1/6/2009 high, forming a series of modified cup & handle formations which I noted on my previous comments.
Based on a successful triangle formation breakout scenario, the price will progress to 34 +/-. This is a vst positive scenario and a negative scenario wave formation is making to upper trend line resistance and regressing to downside breaking the lower support. Qs/Nasdaq is leading markets and during the next week, whether markets will show a continuation of positive price action is in question even though we have seen better price actions for a bounce lately. Clearly, Qs is giving, at least from a hopeful perspective, us a clue to future market direction. Within the larger price formation, a break of a diamond formation is also in progress as Qs is breaking out of the symmetrical triangle formation. However, if the diamond and symmetrical triangle formation is not successfully complete the vst target to 34 by failing to breaking above RST formation which is an extension price action of the diamond formation, then we have alternative EW counts which will be considered later.
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