Market analysis from TheMarketDetective.com that utilizes the Elliott wave principle and Fibonacci analysis.

1. 10/20/2008 8:16 PM pacific
Here is an updated chart of the S&P e-minis. I added labeling for the corrective wave.
There is an Elliott wave rule that a correction can have a maximum of 3 extensions.
(3x3). A double zigzag is clearly identified between (1) and y (w-x-y). That was followed
by a 3 wave correction then another zigzag (a-b-c). The c wave by my calculations can
only extend as high as 100525, the red horizontal line, but it doesn’t have to. It can end
any time.
I do not believe it can extend higher than this without at least a 50% retracement of the
move up from (1). That would reset the count, if you will, making the w-x-y-x-z
corrective wave 1 (w) of a possible larger 3 wave corrective set. In the current context,
this is unlikely, unless we are still in the 4th wave. (The red labels from the report this
morning.)
However, the highest probability following a triple zigzag corrective combination rising
to a .618 Fibonacci retracement level of 5 waves down is probably a turning point, the
end of the 2nd wave, and a resumption of the trend.

2. 10/20/2008 8:16 PM pacific
Not surprising we have the same situation in the NASDAQ e-minis except its recent
weakness has it contained by a .618 and 1.00 Fibonacci extension, and it is dancing along
the .500 Fibonacci retracement level of the five waves down from 1500.
There is a spike down shown by the arrow that spoils the pattern if interpreted by the tip
of the spike. In this case, I am going to defer to the ES which has been the leader and go
with the same interpretation and ignore the spike. 1362 is the primary target if z extends.
I don’t believe we will get above the red horizontal line.
TMD/DW
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