Tuesday, August 17, 2010

8/17 9:40

The 30-minute M/A envelope was broken at 1083.25.  Sold 8% DXD 27.05.  Shorted SP futures 1079.25, covered at 1083.50. 
Assuming that EWI is correct and that the 5 waves from last Monday's high are complete then the market should escape the rectangle shortly.  For DJ futures this is above 10,360.  For SP it is 1089.  For ND it is 1843. 
30-minute M/A now becomes support and it's envelope is now at SP futures 1072.25.  Going there gets me back short, but if we are in Minute2 this should not occur.  How far will Minute 2 extend?  The SP futures 90-minute M/A is currently 1105 but moving slowly down (.618 retracement is 1103.75).  The 60-minute M/A envelope extends to 1096 which is 50% retracement.  This is my range.  Counting the waves to the upside will yield the answer.
I1 is down, technical composite is neutral.

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