There's not much to add to Jim's yesterday post. I'll refrain from posting here long term setups which are not based on KT methodology.

PS. This might be a good contrarian indicator of a nearby turn :-) DJIA has just completed an ending diagonal almost to the day at 0.618 time retracement of Oct 2007 - Mar 2009 drop

Yes, as I view this as just a 'test' of the area. It may also be part of some kind of finishing move down into the area, or may be a 'W2' that just went a little too low (unlike true Elliott people, I think 'W2's' can and do go a bit below 'W1' at times, just as 'W5's' can end lower that 'W3' highs). As long as the level of the area and lines hold, within my acceptable tolerance range, I don't care what it does.

I thought that on such broad index you would not allow for a W2 breach of W1 low. Looks like I was wrong...

Again, I don't really follow Elliott rules at all. I just follow price action that I find has helped me. So, perhaps I should give up all Elliott counts and references, and come up with KT rules (I haven't done this because many would see this as an attempt to repackage Elliott material and call it my own). I only use pseudo-Elliott framework counts because they are somewhat familiar to people.

For example, what is the Elliot count on a double bottom 'test'. Was that 3-4-5 and then straight up, or a long5-1-2? Who cares, to me, it's a 'test' of the area (or 'retest', if you want). I see the 'test' and I can use that. So, if one bottom is slightly above or below the other, does that really change the usefulness of the area to me? Not at all. I haven't seen, over tens of thousands of examples, any really notable differences in these three cases, in the sense that which low is the lower one (or if they are the same), that the setup works less or the move it makes is any different.

IBM just smoked the earnings estimates, yet it is, oddly, trading down a little. I mean, according to what they are saying, they just hit the ball out of the park, knocked the cover off it, exploded the center material, and the fragments launched into orbit and then out of the atmosphere. And that's not good enough for them...

Well, the Sunday night/'Monday' thing persists for yet another week.

Thanks Jim, Jarek such discussions are very helpful.

Mats

Great, Mats, that's why I try to do them.

Okay, here they come. 1.50 points from a new ES 'bull market' high... Let's see if they have the juice, or if it will happen later.

...an exhaustive look at hundreds of stocks suggests to me we are near the years high... i am done for now with the target trades... i am looking for an all in......

Thanks for the post, roofer. So, you're ready, eh, for the new trend? I am seeing more and more clues that it is getting weak, but I still wonder about March and Aug/Sept for potential highs, and that 1400 magnet...

I'm not sure yet if I'm willing to take a short beyond the first support area. I'll have to see how it acts in here. I'd like to say it really should burst up over the recent highs off this pattern, but Nov/Dec really showed just how much this thing can range trade when it wants. I still think the odds favor more up, or a sharp down for more than the recent small corrections, then everyone says that is it, and then right back up it goes. But, time will tell, we'll see. I hope you're right and this is it, big-time top, not seen again for a decade. But, I'll get off the fantasy wagon and back to trades now...

i hope all grasped what i did... i did not forcast.... i simply used the tools of this forum across all my traders until there was not a single buy signal left... that is when important reversals occur...AT THAT MOMENT IN TIME!!!!, THERE IS SIMPLY NO GEOMETRY LEFT TO SUPPORT THE MARKET....jim is perfectly correct to be looking for ABCD'S.... I AM TOO..but looking across hundreds of charts, i believe price was at or near this years high at the recent high...i have no big ideas of how important this high was based on theoretical constructs.... just trading the tools....as the machine that grinds.