Tea Leafs

I’ve been poring over my charts again and also consulted my resident Gypsy woman who conducted a ceremonial tea leaf reading. This is what the future may have in store for us:

For shits and giggles, let’s assume for the moment we are in Minute {iii} of Minor 3 of Intermediate (A) of Primary {2}. I see some monster resistance ahead of us around 870 – 880, based on four factors:

• That’s where we are touching the upper channel connecting (2) and (4) of {1}.
• That’s also the 23.6% fib line of Primary {1}.
• Minor 3 of (A) would measure 78.6% of 1 of (A).
• Because I said so.

So, that seems like a good spot for a little pull back – which wave degree I’m not sure yet. After that we got the psychologically important 900 range which I believe we’ll retest (Minor 4) and finally, we might complete Intermediate (A) around the 960 level.

Please bear in mind that this scenario is highly speculative – especially at this early stage – but I wanted to throw it out there.

Having said that – boy, are we overbought. But take a good look at how useless stochastics are in such conditions. We have been doing the Chinese snake wiggle around the 80 line for three weeks now – and as long as the bears remain in hibernation this is likely to continue.

The fly in my ointment is the NDX, which has been leading the tape right from the very bottom of this channel. It’s pretty obvious we’re about to run into some heavy resistance here. So, if we start dropping tomorrow and consolidate more than a few points then I’ll have to adjust that wave count above a little – really tough to say how right now. I have been going through a few scenarios in my head but don’t have a perfect count to offer that would accommodate a short term bearish scenario. Again, this is all a bit premature at this point but that’s my process of establishing some bearings.

No matter which way we’ll head tomorrow – fact is that we have not had a great chance to load up on medium term bullish trades here. It’s been one steep channel to the upside – and we might have to wait until this Intermediate is over and complete – which sucks, but that’s the card we’ve been dealt. Of course the moment we get a deep retracement (40 – 50 SPX points) I would be very motivated to jump in with one of the spread strategies we discussed today – Fujisan has also offered great additional input on the subject.

Gold – do I have to say it? Exactly – that fucking diagonal still has not been breached. Yeah, we are theoretically below it today but that’s more of a tease. I can literally hear it taunt us: “Over here, big boy – come and get me!” Yeah right – I wasn’t born yesterday – I want to see a clear breach below and then a retest, otherwise no heavy metal for me. Which reminds me:

See you tomorrow morning bright eyed and busy tailed.

UPDATE  12:00am EDT: Seriously, some of you new rats are starting to wear me out. I don’t know which woodwork all those wanna-be Elliotticians crawled out of recently but I keep seeing a constant flood of crappy counts here that are not even open to discussion as they either:

• Violate basic EWT rules (e.g. zigzags pointing towards the current trend – I mean did you guys read a book on the subject?).
• Have a very low probability at the current moment – no matter which way you count it (e.g. the ending diagonal, which isn’t worth masturbating about until we breach 700, which is what – 100 SPX points away?).
• Are completely off the chart, meaning I cannot make heads or tales out of them.

In the name of free speech I have been suffering in silence long enough but going forward you guys are going to get slammed and that hard. I have no problem with intelligent discourse, mind you – but after three weeks of being constantly barraged about ‘how we cannot possibly push any higher’ and ‘how wrong I am’ I suggest you guys take a look at the fucking tape! We closed at 833 today.

Yeah, eventually you’ll be right – just like a stopped clock twice a day. But until then you can bite my shiny metal ass. May I point out that I have been supporting the short term bullish scenario for two weeks now – starting a few days after March 6th. Since then I keep seeing some different Frankenchart posing as EWT on a daily basis – most of them have not come even close to predicting the tape that wound up unfolding.

So until you guys establish a track record and have anything of value to offer you can bite my shiny metal ass. I suggest we stick with high probability scenarios, which right now are of the bullish variety, no matter if we consolidate tomorrow or not.

G’night.

Mole