wednesday update -- MrSwing

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wednesday update
Jul 09, 2008

Tony

the ELLIOTT WAVE lives on
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SHORT TERM: market fails to break through SPX 1280, DOW -238

Overnight the Asian markets were all higher, and Europe opened higher and closed +0.95%. US index futures traded slightly higher overnight, and lacking any economic news, the market opened higher this morning. After hitting SPX 1277 at the open, a pullback followed to 1268 by 10:00. Then another push higher stopped at 1277 again by 11:30. Failing to break through 1280, which would have indicated a change in the characteristic of this downtrend, the market headed lower. By 2:30 the SPX broke through the 1261 support pivot, and headed toward the 1240 pivot nearing the close, closing at 1245. SPX/DOW were -2.20%, and the NDX/NAZ were -2.70%. Bonds were up nearly 1/2 point, Crude lost 40 cents, Gold gaind $5.50, and the Euro was higher. Support for the SPX drops back to 1240 and then 1219, with resistance at 1261 and then 1287. Short term momentum was overbought this morning and turned oversold at the close. The near term indicators are still displaying positive divergences. Tomorrow weekly jobless claims at 8:30, and Bernanke speaks in the Senate at 10:00. Monday's low was SPX 1241, tuesday's 1243, today 1245. Clearly the 1240 OEW pivot is being tested. If it fails to hold the downtrend will likely continue to under 1200. If it holds the market has to rally more than 40+ points from the low. Best to your trading!

MEDIUM TERM: downtrend trying to hold 1241 low

LONG TERM: bear market

CHARTS: http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1606987