Tuesday, August 6, 2013

ImageFollowing the 4 hour chart on the S&P 500 (SPX) is no longer useful at the moment. The TD Sell Setup was active up to bar 8 and did not ‘perfect’ the count by meeting or exceeding bar 6’s high. With today’s impulsive move down, it was good enough to produce a bearish price flip and negating the final 9 count. ImageImageImageTaking inventory on some of the daily counts, SPX completed a 13 on TD Combo Sell last Friday but it one count short of recording a 13 on TD Sell Countdown. The Russell 2000 (RUT) completed a pair of 13’s when the RUT recorded a 13 count TD Sell Countdown yesterday.  The one holdout is the Nasdaq Composite (COMPQ). It is one count short of recording a TD Sell Countdown. ImageTo address the one count deficiency of the COMPQ, a look at the ETF component, the PowerShares (QQQ) shows a 13 TD Sell Countdown last Friday and a ‘perfected’ 8 count yesterday on TD Sell Setup. As a whole, the pieces are in and showing multiple price exhaustion signs


While there was room for the markets to move marginally higher, it did not take it and today is the first sign of a possible shift of momentum. Since the SPX 4 hour chart never completed a ‘perfected’ TD Sell Setup, I was not nimble enough to position short ahead of the downturn. Hopefully the market will allow for a second chance to capture a more favorable risk/reward level. A close below SPX 1698 will certainly put me in a place to participate on the short side.  (updated intraday)

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