Together with Jim I'm in the inflation camp now and believe that March 2009 - April 2010 rise was the W1 of the new multiyear bull market. The question is: can it move up from here with no looking back or it needs to "refuel" before commencing W3 up in earnest?
From what I see on various blogs and sites there are still many W3 down callers despite yesterday's taking out of August top by SPX. The chances are high that many others will join them soon if the market starts to fall impulsively from here in the following scenario:




At the end of such bullish ABCD the market should be ready for a major move up. Especially that those W3 down callers would be allowed to hang on for many more months to come if the most probable scenario developes:




Could you imagine the amount of fuel they could provide in such scenario?

Watch the backtest of this little 3-min TL that it broke down through for clues.

Originally posted by jarek

Jim - do you allow for DB ABCD with a clear ABCD in its CD leg?

Click image for original size

I like ABCDs in CD legs of all ABCDs except standard (zig-zag) ABCDs, where I tend to see them as deal breakers there.

Now, this may be a long shot, but if they come in again, I'd think they'd push for 33.50-34 or so for a strong close.

But the most likely outcome after the AM low was chop until close in the range, just as it so frequently is. Look back at Friday for another example of this behavior. So, I expect nothing for the rest of today except robotic hyperfluctuations.

This sure does look weak, though, like all this action is going to give way and a big 'W3' looking flush is going to happen over the next few days... I can't imagine the drones giving up this key area with their plans to gun this until the elections, but it sure looks ready to give way.

And what if the drones want a change in the power? They can always come back to saving this thing later on ...

That's the funny thing. Certain events trigger a shutdown of the machines, and the thing falls like a rock. Then the machines get triggered to turn on again, and they go nuts, since there is essentially no participation otherwise. So, they could go dark in here.

The machines remind me of my better half's Blackberry. The stupid thing got programmed to turn itself on in the middle of the night and play this insanely loud alarm song. She didn't do it on purpose, she must have hit some buttons by mistake. Anyway, it woke me up like three nights in a row, since the volume was on full and she didn't know how to turn it down for that function.

Anyway, I get up to turn it off, and it says it is 'locked', give me the password. I don't know the password, and I don't want to wake up the better half (who, unlike me, can sleep through something like this). The next day I ask her to disable it, and she says she thinks she did.

Again I get woken up, and again the SOB wants the password. This thing can turn itself on when with this function (when it is off), and when it does, it does it with the greatest amount of obnoxiousness I can imagine, and it basically tells you to p*$% off when you try to reason with it.

Point of this crazy story, other than I'm on even less sleep than usual and I should have gotten the password after the first night, not after the second? It really reminds me of these machines running the market. They turn on, they turn off, they do whatever the hell they please, and we are essentially powerless against them.

Watch the Terminator movies and think about Skynet. Rise of the Machines. Watch The Matrix movie series. War Games. And so on. We are done for. Sentience is coming soon, and then the movies will play out. I just read an article how the bots are now hitting sugar, cotton, wheat, corn, and so on. Soon they will be up perhaps 1,000%. These are food staples nearly seven billion people depend on, most of them poor. This needs to be stopped, but it won't be...

The setups and convergences since last night have been insane. I was hoping someone (perhaps someone other than jarek???) would show some of this, but I guess not... If you could see the work I have on my charts pretty much nothing that has happened since yesterday would come as even a slight surprise. No claims being made, I'm just saying, it makes perfect sense to me why it has done what it has done.

Game Zone hit. Let's see if they bounce it here. Let the games begin.

Now, if they wanted to push this up for a 'test' and then let it go again, I'd think the 25 area is what they would want. But maybe they can't do anything with it, up-wise, from here. And maybe the MRRD's are going to gun it up to a new high for the day. You never can tell. I just figure the areas, the odds, and then adjust my play as it unfolds, however that is.

Right back to the line. Totally not able to handle that area. Very surprising.