7/25/11

SPX:

The S&P 500 closed at 1337.43 down 7.59 on the day.

I hold that this correction is Minuette (ii) of Minute [iii] of Minor 5 of Intermediate (C) of Primary [B].  It may have actually already entered Minuette (iii), and today's morning rise was Subminuette i with the afternoon reversal Subminuette ii.  If this is the case, the markets should rise strongly going into tomorrow (perhaps gapping up), as we will be in iii of (iii) of [iii].

I suspect however that Minor 5 is going to take the form of a petering-out wave where wave 1 (in this case, Minute [i]) is the longest and strongest.  According to this wavecount, the length of Minute [i] is 93.61 SPX points.  I expect Minute [iii] to be approximately the same length as Minute [i], which would put the endpoint of Minute [iii] at ~1389.53.  Minuette (iii) may get close to that, and Minuette (v) should reach or slightly exceed it.  (i.e. short term target 1390).  Minute [iv] may then pull back to the 1360s, followed by another thrust upwards which I expect to be .618 the length of Minute [i]/[iii], bringing us to ~1420 as the top of Minor 5 and Primary [B].

The EURUSD appears to be in a falling wedge.  Taken from the May 3 closing price, the upper line of the wedge almost perfectly aligns with the June 7 and July 4 highs.  It crosses 1.4459 tomorrow, the point at which the rise from July 17 (which I suspect to be a C wave) will be the same (1.00x) price-wise as the rise from July 11-13 (which I suspect to be an A wave).  I would thus not be surprised to see a thrust to the 1.4459 area tonight or tomorrow so that the wedge may be met again and this Fibonacci ratio will be satisfied.  (It also does not appear that we have had wave 5 of C yet, and have been going sideways in wave 4 since Thursday.)  Disclosure:  I am long UUP.

As for the Keller Ridiculous Adoration Portfolio, not even the combined counter-forces of yoga, burritos, comfy shoes, iPads and hyped social networks were sufficient to overcome the downward market forces today.  The index closed down 2.98 today at 1634.55.  The primary contributor was LULU, which was down almost 2.5% today and which could not be overcome by the four other stocks in the index, at least not the way I have the index set up.