S&P 500 Weekly (Linear) - This Picture Looks Bullish

While the longer term Wave forecast remain bearish, the fact is this is short to medium term
picture looks bullish. The 89 day SMA (blue line) has been the one moving average we’ll
consider because it has been so good at confirming medium term trend reversals. It has been
broken decisively and appears to be “flattening” out now--this indicator looks bullish. The
downtrend line (green dashed) has been decisively broken, and was retested. Using classic
chart theory, this looks bullish. The pattern off the March lows does resemble a Head and
Shoulder bottom, even though the right shoulders seems a bit small. The target for this pattern
comes in around 1,235, so that is yet another bullish indicator.

Head & Shoulder

Target is ~ 1235

The “double top” is the only thing

bears can hang on to here.

Right
There’s nothing about this picture that suggests Shoulder?
anything other than being bullish or neutral in the
short to medium term. In other words, there’s
nothing here that shouts: “Short Me.”
Left
Shoulder

Head

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Weekly (Log Scale)
Supercycle How does the bullish picture on the first slide fit into the longer term wave count? If this is a Primary -B- wave up from the Mar 09 lows,
Wave III then it SHOULD correct 60-80% of the decline and consume at least as much time as the -A- Wave down. With that in mind, this
(Euphoria) correction could run much longer and deeper than previously considered. If this is an -X- Wave, then it should be shorter and less
enduring than -B-. This is why, given the completed “look” of the correction up from Mar ’09, I had been labeling the move an -X-.

<B>

(B)

-X- or -B-
(A)

<A>

(C)
-W- or -A-

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Daily ~ A “Triple” Concluded
-X-
(Z)
“c”
(Y)
Model Reprinted from 2/15/10 “g” “a”
9.2% decline
“e”
“b”
“c”
1029/1036
“a” 1034
“f”
(W) (X)
“g” “d”
“b”
“e”

“c”
9.1% decline
“f”
869
“a”
“d” (X)

“b” This was the last medium term model we had in mind on 2/15/10. The one “troubling”
aspect about this picture for the bears was that the decline (from Jan highs) was neither
larger nor more severe than any previous decline. This SINGLE fact prevented us from
being able to CONFIRM a top, and left us with a little bit of “doubt.” Those doubts have
now become realities with the S&P now setting new highs….

667
-W-

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Daily ~ A “Triple” Concluded

-X-
(Z)
“c”
1150 b
(Y)
“g” “a”
“e”
“b”
“c”
“a” a
1034
(W) “f”
(X)
“g” “d” c
“b”
“e”

“c”
“f”
869
“a”
(X)
“d”

I won’t adjust this preferred model until the market forces me to do so. For now, this count remains
“b” viable because the market did not decisively take out the “c” wave conclusion at 1150. We could
still be dealing with an a-b-c progression from the January peak. However, the market MUST peak
and reverse very soon. If the count must be readjusted, it will be done so only in a minor way.*

*Major recounts should be rare if one is counting the waves correctly. Technicians who
667 constantly change wave counts in major ways should not be taken too seriously.
-W-

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Daily ~ An On Going “Triple” (Z)
“c”
(Y)
“y” “a”
c
c
“w”
g a a
e
b
b “b”
c
a (X)
1034
f
d
“x”
(W)
b
These two waves do look very much “alike.”

869
(X)

One of the biggest flaws with most wave counts (mine included) is the bias towards developing models
that “conclude” waves too soon. Glenn Neely has an expression: “If there is a way for a wave to last
longer, then it will.” This idea has been reinforced on me more than a few times in the last several
months. The persistence of this corrective wave has been surprising to me while the overall pattern
remains unusually shaped and a bit confusing. So be it. The bullish case would be that the recent lows
in early Feb concluded only the second (X) wave and we’ve got more bullish price action ahead. One
prime target for this (Z) Wave would be 1219, for 61.8% of (Y)=(Z)
667
-W-

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Daily (Log Scale) ~ An On Going “Triple” (Z)
1219?

(Y)

(X)
(W)

(X)

In support of the idea of an ongoing “Triple,” it’s possible to draw a perfect trend channel that connects
the (X) waves with the (W) and (Y) end points.

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Weekly (Linear)

So, a decisive break of 1150 (let’s say a close above 1160) would lead us to a target zone between
1219 [61.8% of (Y)=(Z) and 1235 [Head and Shoulder objective]. Interestingly, the 61.8% retracement
of the entire decline lies at 1229.

Head & Shoulder

Target is ~ 1235
(Z)

(Y)

This wide zone between 1200 and 1300 was the

scene of a huge battle between and bulls and
bears in 2008. The market will have a memory of
this price action and respect it. (X)
(W)

(X)

Right
Shoulder

Left
Shoulder

Head

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Daily ~ “Unorthodox” Diametrics? (Z)
“c”
“a”
(Y) c
“g”
“e”
a
“c”

“f” b “b”
“a” (X)
“d”
(W) “b”
“g”
“e”

“c”
“f”
(X)
“a”
“d”

“b” This page is just for fun. Instead of the count on Slide 5, we could be dealing with another “diametric” in
the (Y) position. These formations can either look like “bow-ties,” as with Wave (W), or they can be
reversed and look “diamond” shaped, which may be what is transpiring in Wave (Y)

667
-W-

Andy’s Technical Commentary__________________________________________________________________________________________________

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kind. This report is technical commentary only. The author is Wave Symbology
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interpretation of technical analysis. The author may or may not I or A = Supercycle
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