Tuesday, December 28, 2010

Wave B of (B) Is Nearing Completion

I've shown what I believe to be the most likely count for the Qs with a zigzag for wave B.  The correction from the April high would then either be an expanded flat or a running triangle or even possibly a running flat with 5 waves down terminating above the July low.  A running flat was seen in the middle of the 2002 to 2007 rally and could show up again.  It would probably be best at this point to wait for the secondary reaction in wave [ii] or [a] of C down to complete before getting short or adding to existing short positions.

While not shown, one possible alternate is that the move from the early November high to date is part of a 4th wave expanded flat correction and the Qs could see another new high.  That would not eliminate the above expectations for an expanded flat or running triangle, but it would change how it is counted.

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