Monday, October 11, 2010

IWM Pattern Complete

The ending diagonal pattern in the IWM appears to be complete as of today. It managed to eke out a new high, but on much lower volume. I believe today's date, October 11, may prove to be significant as discussed previously.

On the 5 minute time frame we can see a clear 5 wave impulse to the downside from today's high. While it is too early to extrapolate from the 5 minute time frame to the daily, given the clear pattern completion on the daily chart, it seems probable that the IWM has completed wave B up.

The Qs, on the other hand, also made a new high for the August/September rally today and appear to have completed wave b of a 4th wave flat correction that will eventually lead to a retest of the April high in November.

The FXE continued lower today,and we may have seen a bottom in the Dollar. Silver is testing the high of last Thursday's reversal bar, but in all likelihood, it should continue rollover over with a rally in the Dollar. We should know in short order if wave C down is underway in the most stock indexes, with the Nasdaq being an exception.

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