Stock Trend Remains Down, Although a High Confidence Wave Count is Elusive; Euro Trend Down

Today's action was bearish in my view.  The internals showed mild total volume, but not as light as earlier in the week when we were in the 800s million shares.  But up vs down volume was only slightly bullish and the advancers vs decliners were mildly bullish.  Yet you'd think the market would look stronger than that internally since the whole trading day seemed like it had its rally jets on as it continually floated higher.  But it didn't.  Today' rise appears corrective when looking at it internally compared to the price action.  And when you add the fact that the gains the market made today fell apart sharply at the end of the day, price action also lends itself to a bearish day.  So even though the markets closed up today, it was not an impressive move higher by any means.

Stock Downtrend Tested Today; Euro Extends Correction

Stocks' downtrend remains intact by the skin of their teeth.  Today's rallys stopped short of making a new high above 1346.82 in the S&P.  So the series of lower highs and lower lows is still in place, and therefore the downtrend remains in place.  Shorting here against 1346.82 would be a good risk/reward trade for the bears.  Although in the bigger picture, with no clear wave count in place, and certainly nothing impulsive looking, I think this downward action lately is all part of a correction that will result in a move to new highs on the year eventually.  So if I were short, I'd play it tight here and only for the short term action.  Longer term the market still seems bullish.


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Euro and Stock Bear WARNING

Price action today in the S&P and the euro suggest a possible bullish reversal just took place which might act as a floor for these markets for at least a few days.

Stock Outlook Mixed; Euro Breaking Down

Late last week we saw some topping action that suggested weakness going into this week.  And we got it.  But it may be over now.  There is still a clear 3 wave decline (ABC) from the high on the year in the S&P, so a new high on the year seems likely.  We can't forget that.  Only the Nasdaq 100 managed a new high while the other major indices failed.  Now, the rally from the wave C low looks impulsive, with the recent weakness this week being a wave ((iv)).  If correct, stocks should be on their way to new highs on the year soon.

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