S&P 500 Price Targets for Low

Last Fridays post indicated that a short term stock market top was probably made the previous day on 10/15. On Monday 10/19, the S&P 500 made a slight closing high above the previous weeks high. That was the highest closing price of the week with the market now near the lows of the week as this is being written.

Stocks look highly probable to have a continued decline into the early or middle of next week as the C wave of a zigzag completes. The fib price targets for the low are 1062 and 1050.

Probable Short Term Top in Stocks - 10/16/09

It appears stocks made a short term top yesterday, with the s&p 500 topping one point above the 1091-1095 price range given in previous posts. That outlook may be negated with a close above yesterdays high. The move may go down to test the early October low in the next two weeks.

Gold/GLD Wave Count, Sugar/SGG - 10/11/09

Gold / GLD

See chart below for current GLD wave count. Wave 3 is currently in progress, to be followed by waves 4 and 5. Since wave 3 has already reached 104.15, the 105.5 target from the end of the triangle at the end of August should be easily surpassed before wave 5 completes, and possibly before wave 3 completes.
Chart: SPDR Gold Trust six month chart, click to enlarge


Sugar / SGG

Sugar appears to be at or near the completion of a zigzag from the late August high with an initial target near the late September high. This upmove can be played with the iPath sugar etf, symbol SGG.

Stocks at or Near Short Term Top? - 10/11/09

Last weeks post called for stocks to move up to test the trendline connecting the September 23rd and 29th highs, with a test of the 9/23 high on a close above the trendline. That test of the trendline occurred on Tuesday and Wednesday with a close above it on Thursday. The market is now testing the September highs.

It looks like the most likely outcome of this test is for an early week top between Fridays high and the September high price or maybe slightly higher as the current swing cycle time band of 10/7 - 10/12 ends Monday. The early week high might be tested toward the end of the week. A close above the 9/23 top would probably be followed by a move up to the 1091 to 1095 fib resistance zone on the s&p 500.

Stocks at or Near Short Term Low - 10/4/09

Stocks

Stocks appear to be at or near a short term low. The Dow has pulled back to the 50 day moving average and trendline support. Most likely, this will bring an upmove that will test the trendline connecting the September tops(shown on chart). That could happen by the end of the week. A close above that trendline should bring a test of the September 23rd top. A close below Friday's low would be bearish.
Chart: Dow Industrials three month chart, Click to enlarge.


Gold

Gold completed a zigzag at the 9/25 low(one trading day before the 9/27 - 9/28 swing cycle date) . It will probably move up along with stocks this week.

Stocks Update - 9/27/09

Stocks made a top on Wednesday per the 9/20 blog post forecast. The price target for the top was not reached but the minimum requirements for five waves up were met per the 9/23 blog post. The top of wave five only has to go one tick above the high of wave four for the count to be valid and wave structure trumps price targets when a wave is completing. The forecast was for 250 points up on the Dow from the end of wave four to the top of wave five and the actual number was 138 points up. From the low of wave four to the top of wave five the move was 250 points, so that was an interesting coincidence.

The next swing cycle date is Monday, 9/28, so wave a down from last weeks top may end by Tuesday with sideways or higher price action to the end of the week as wave a is retraced. The correction started with a key reversal on Wednesday, but so far seems fairly mild. So it is to early to determine what the wave count is from the March low to last weeks top.