Tuesday, October 19, 2010

Building A Top

Today's action was the first real bearish action we have seen since 9/30, and it is too early to be certain that the top is in. I still think we will see another high in the Qs, but the other indexes may have seen their highs as of yesterday. After the post about triangles yesterday, it appears that the IWM may have put in a truncated 5th wave. At the moment, however, we only have 3 overlapping waves down from yesterday's high, so there is a lot more downside work to do before we can be sure of a top.

Then, we will be looking for a breech of the August high to invalidate the bullish count, or a pullback that stays above the August high and a 5th wave of minor degree to confirm the bullish count. Either way, it is finally starting to get interesting.

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