Thursday, 21 June 2012

S&P 500, Thursday, June 21, 2012

Hi Traders,

Before getting into our usual analysis, let me answer to one of your questions.


I keep being asked about organising training seminars and webinars about my way to use Elliott Waves in everyday trading (and more). This what I do


I organise large trading seminars (2.5 days - 5+5+3 hours) on a quarterly base in
  • Brisbane,
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  • Sydney,
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I will take you to a practical way to trade through
  • a new way to master Elliott Waves and Entry Points.
  • a simple system to recognise Reversal Candlesticks and calculate Fibonacci Targets.
  • the right combination of Psycology of Trading
  • and Money Management.
  • A lot more.
This includes a lot of practical trading on a demo account and, when possible, on a live account.


I'm also organising monthly webinars around the same topics. It can be on a one-to-one or on a collective base (up to 5 people).

Anyone interested please contact me at the numbers below.

Cheers. Mario. Organiser.
W: 02 800 34 618
M: 0405 233 578
Skype ID: mariodconti


ANALYSIS: S&P 500 started "The rally of the last leg up".

In the weekly chart below the S&P 500 completed wave 5.4 (out of 5 waves) and just started wave 5.5, which is the very last 5th wave up within the 5th wave of major grade. In few words: it's fifth of the fifth.

The 161.8% target calculated upon the range of wave 5.1 should take the index in the vicinity of 1,420, generating a double top as the last one topped at 1,418.

Only in the remote case of the Federal Reserve implementing a substantial QE3  there would be an extension of the wave 5.5 that would push the index to level 1,643. But this seems to be quite unlikely at this stage.

This is comfirmed by the daily chart below: see waves 5.5.1 and 5.5.2. Wave  5.5.3 in blue was able to breakout the channel and should be able to reach a minimum target of 1,387.

The 4hour chart below confirms this hypothesis: wave 4 touched the magenta channel. it's supposed bounce back and generate a rally to form wave 5. This would actually complete wave 5.5.3 of the daily chart (above)

Finally, see the 1hour chart below with wave 4 performing a 3-X-3 and touching the lower boundary of the channel. Unless a last minute surprise, it's supposed to rally from now on.

Note: the volatility around wave X was caused by Ben Bernanke announcing another round of  "Operation Twist" by $267 billion. The market mistakenly thought that the FED was injecting more liquidity. 

Instead, it will sell that amount of short-term securities to buy longer-term ones to keep long-term borrowing costs down. The program, which was due to expire this month, will now run through the end of the year.

That announcements caused a roller coaster of the market for about 3 hours.

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