What Top Does This Represent?
December 4, 2013
By Avi Gilburt ElliottWaveTrader.net
With the market now breaking down below the upper support region, and, for now, finding support in the lower support region EXACTLY at the 1786ES level, it opens up the question as to what the last top represented. While we need to see a strong break down of the 1786ES region to start looking at larger degree tops being in place, we may only have the yellow iii top in place, with this yellow iv finding support at exactly the .382 retracement of that yellow iii.
For now, I will be watching very closely to see if the market begins an impulsive move to signal that wave v of 5 is what is in store over the next week to take us to a target of 1818ES (where waves i and v would be equal), or if this is just the first move down in a much larger degree decline, or, the more "goldilocks" approach that Zac and Xenia are looking towards, as a 4th wave with one last 100 point rally to be seen as we find support near our primary support region below. Remember, it will take a break down below our primary support region to signal that a major top has been struck, and that we are targeting the 1500 region within the next month or two.
See chart illustrating wave count on the Emini S&P 500.
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Avi Gilburt is author of ElliottWaveTrader.net, a live trading room and member forum focusing on Elliott Wave market analysis. Avi emphasizes a comprehensive reading of charts and wave counts that is free of personal bias or predisposition. His Elliott Wave analysis appears frequently on sites such as SeekingAlpha, where he is a certified contributor; MarketWatch; and TheStreet.com.