S&P 500 ~ Weekly (Log Scale)

The preferred count would be that were in the midst of an expanding triangle and were currently experiencing the d-wave which should be larger than the c-wave. The implications are that when (if) the S&P 500 takes out the 1370 highs, it will become an epic bull trap, as the e-wave down will be dramatic.

-Bb

REPRINTED from 7/3/2011

y
1344

d b

w a
c
1150

b a d
e

x
a
e 1040

The w wave was a contracting triangle with an extreme upward skew. The c & e waves were 78.6% and 38.2% of the a-wave. The d-wave was 78.62% of b-wave. The y wave appears to be a diametric that was exactly 61.8% of w.

c (A)

Andys Technical Commentary__________________________________________________________________________________________________

S&P 500 ~ Daily: The Expanding Triangle

d b

y
1344

-a1356

-b-

The concept that were witnessing an expanding triangle x wave is still favored. The d-wave in this case MUST exceed the b-wave peak of 1370. Any new high should be a serious bull trap as the market will witness a powerful e-wave lower when the d-wave completes. 1295 appears to be key support for the d-wave. Breaking below that level will leave us with the neutral triangle count highlighted on the next page.

Andys Technical Commentary__________________________________________________________________________________________________

S&P 500 ~ Daily: The Neutral Triangle

z
Left Shoulder Head

Right Shoulder

y
1344

Neckline

c
e

x
The neutral triangle concept should set up another failed Head and Shoulder fake out. The scenario can all be assured if we start hearing CNBC technicians or other blogging pundits discussing the neckline break in a meaningful way. The key takeaway from both slide #2 and #3 is that this will be a treacherous short term trading environment. The trading bias is to stay away from this market until we either: a) breakdown to the 1220-1250 zone which will look like a buying opportunity, or; b) break out to a new high above 1370 which will be a selling opportunity. Everything else in between should be an unpredictable chopfest that can destroy trading capital.

Andys Technical Commentary__________________________________________________________________________________________________

SEP S&P 500 Futures ~ Daily

The futures tell a slightly different story than the cash. The Sep futures already dipped and tested key support around 1295. Short term bulls dont want to see 1294 get violated.

d?

b
-a-?

-b-?

Andys Technical Commentary__________________________________________________________________________________________________

Other Discussion
Theres been a lot of bullish and bearish news events that are causing knee jerk reactions in these markets. Its important to keep in mind this following general concept: Markets in a bullish trend rarely peak on bad news. Its one of the reasons weve seen bearish Unemployment Reports and Greek Debt Problems get bought in the pre-market sessions. Selling down moves on bad news in a bullishly trending market is rarely rewarding. Alternatively, selling down moves that nobody can really explain (because that news was bullish) can be much more rewarding. Sometimes with technical analysis, we can lose the forest from the trees The wave count in the last few months has focused on the concept that were experiencing an x wave with a small z wave higher to come at some point. So, in the shorter term, the bias is that we will eventually get marginally higher highs above 1370 or at least a rigorous re-test of 1370. Its worth reiterating, however, that in the bigger picture, were getting closer and closer to completing an Intermediate (B) Wave, if it hasnt already completed. The implications are that, at some point in the near future, the S&P500 will experience a 30-40% decline which should take the S&P back to the 850-935 range. TRAVEL/Future Reports I typically spend time on the charts during free time on the weekends. For some reason, my family has travel plans for every single weekend during the month of JULY. So, the reports will be spotty and will come out during the weekdays, if at all. So it goes during the summer vacation season. My schedule gets more normal in during August. Best Regards, AT.

Andys Technical Commentary__________________________________________________________________________________________________

PLEASE NOTE THAT THERE IS ADDITIONAL INTRA-WEEK AND INTRADAY DISCUSSION ON TECHNICAL ANALYSIS AND TRADING AT TRADERS-ANONYMOUS.BLOGSPOT.COM

Wave Symbology "I" or "A" I or A <I>or <A> -I- or -A(I) or (A) "1 or "a" 1 or a -1- or -a(1) or (a) [1] or [a] [.1] or [.a] = Grand Supercycle = Supercycle = Cycle = Primary = Intermediate = Minor = Minute = Minuette = Sub-minuette = Micro = Sub-Micro

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