6/6 Weekly Commentary

Stock market bottom is at the close Tuesday.  I got another 1% short via SDS in ARCA session Friday at 35.55 after SP futures broke their critical support at 1067.  Currently 3% short. 
Here are the I1 numbers going forward (divide by 10 to reference an I1 chart):
1 20100604 27.33011

1 20100607 26.04103
1 20100608 25.76787
1 20100609 26.63697
1 20100610 28.02181
1 20100611 29.63877
1 20100614 32.30605
1 20100615 34.33631
1 20100616 36.33645
1 20100617 37.751
1 20100618 38.73679
1 20100621 39.33455
1 20100622 39.05581
1 20100623 38.36848
1 20100624 37.36278
1 20100625 35.99958
1 20100628 32.87279
1 20100629 30.01833
1 20100630 27.26258
1 20100701 24.67989
Here is the current I1 chart:

My favorite scenario is for the market to break the Feb and May low and fall to 1020 SP futures.  This will produce a breakout that should prove to be false. 

Notice the intersection of the 60 and 110 week M/As with the May low on the DJI chart.  The I1 upward move from 6/8 to 6/21 is over 15 (1.5 on the chart) and is not something I want to short through unless the SPX breaks 1000. 

My wave count stands (wave (i) complete 5/25 and wave (ii) complete 6/3 overnight) because the final push overnight into SP 1108 was 38% of the entire decline from 4/26, so price was satisfied.  The counterwave up took almost 9 market days, so time was satisfied (for a 22 day decline).  If so, then wave 3 started overnight Thursday and a severe decline is in the works.  Regardless, I'll be counting from a 5-wave down from that high.

BP is now collecting 1/3 of the oil leak. If gasoline prices continue downward in their counter-intuitive decline they will produce a 5-wave.