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Sunday, August 12, 2012

$SPX: EW count. Trying to figure a new weekly high above 1,422.38


Chart 1: Primary wave B is in place.


Chart 2: Primary wave B is in play.

Our EW count considers that primary wave B is in place (chart 1) so, 1,422.38 is the highest value before, cycle wave 2, down, is in place. IF primary wave B is in place, it also means that primary wave C, down, is in play so, this wave will have 5 waves and we are counting intermediate wave 1, in place and intermediate wave 2, up, in play. wave 1 is an impulsive wave and wave 2, should be a retracement wave. In chart 1, wave 1 looks as an impulsive wave and wave 2, looks as an retracement wave.

Chart 2, shows us a EW count with primary wave B in play. This count don't respect the third EW count and,also, wave 5, doesn't look as an impulsive wave, in our honest opinion.

We consider that this rally can't surpass the 1,422.38 resistance line.