Weekend Update #2

30 YR BONDS
The bond complex continues to confound me. I thought I had a handle on what structure was doing, but I'm losing confidence in my assessment - fast.

I currently have bonds tracing an expanded flat minor 2 wave. The line in the sand with this count is the 121'11.5 H. This breach of price will invalidate a wave 2, as well as, invalidating a triangle.

We came darn close on Thursday, registering an intraday high of 121'07. When drilling down on a smaller time-frame, price action does not appear to be impulsive off that high.

Intermediate wave (1) L is 121'23.5. Should price continue moving higher, this level will be important. If this level is broken on the upside, this should lock-in the 111'21.5 L as an intermediate tradable bottom.

I'm still hopeful that 121'11.5 holds. I'm bullish above that level and bearish below a 114'25.5 break. Sorry folks, that's the best I can do at this point.

All prices basis continuous contract.

GOLD
This is another market that's frustrating both bull and bear.

They are most definitely coiling this up for a break. Which way? You can make a prudent argument for both up and down.

Long-term I believe structure strongly suggests we should see significantly higher price. From an intermediate standpoint, it suggests that price should see lower lows before the launch. Near-term, the picture is unclear.

It does look like a triangle has traced. In fact, minute [e] should be complete, thus suggesting that a "thrust" out of the triangle should be happening. Friday was a good start, but notice that the entire day was spent retracing 10 minutes worth of upside action around 7:30 am cst.

I just don't see a thrust, nor do I see impulsive price action off the 931.30 L. I will maintain my current count that we are in the beginning stages of intermediate (C) down.

I will get bullish with a price close above the 974.30 H and base channel (preferably with a gap Monday). I will get uber bearish with a price close below 927.60. No use making any wagers prior to one of those levels being violated.

Just be patient...structure will reveal its true identity soon.

All prices basis continuous contract.

DOLLAR INDEX
Has the dollar escaped with just a near death experience? Not sure, but this pig needs to make a move now.

I think you can pretty well use the 77.81 L as the line in the sand. If that level gives, you can bet that the 77.52 L is doomed (and my bullish view).

Odds favor a break lower imo. I'm not sure how you come up with anything impulsive with price action off the 77.81 L. Perhaps, it's beyond my skill level. Perhaps, it's just not there :)

I will maintain my bullish count until they break the minute [ii] 77.81 L. This will mean that intermediate (C) has not finished its business.

We need to see price take the 78.895 H for beginners. If they can accomplish that mission, 79.695 will be the next target.

All prices basis continuous contract.

CRUDE
The crude market pretty well followed my expectations for the week, although I thought that price would reach a little higher.

It appears that minuette (b) has finished at the 69.83 L, though not a certainty. We have a nice clean 5 wave structure up from that level, which I have labeled as sub-minuette i.

Once we have completed 5 sub-minuette degree waves up, we should finish (c), thus completing minute [b]. Minute [c] down should follow.

Notice how price was rejected at the corrective base channel.

Also notice the RSI divergence at the top of the micro [5]th. Exactly what should be expected with a 5th wave.

It appears that we have finished ii down and have started iii up in earnest. If [2] has completed, which is unclear at this point, we should enter the meat of (c)'s advance.

Near term, I expect price to follow through to the upside. We should see the completion of [b] later in the week.

(w) = (y) at 80.38. the minimum objective is the 61.8% of (w) at 75.25.

I'm anxious to see if they break price out to a new recovery (and yearly) high. This is at 76.56.

A double zigzag is comprised of 7 waves, which fits right in with my friend, buddy, pal Kools "7 Wave Trend Killer." The daily clearly shows the first 6.

All prices basis continuous contract.

Weekend Update - Grains

SOYBEANS
The bean market continues to shun the rest of the grain markets (including rice and oats) and do its own thing.

We had decisive upside price action this week, taking out the 974.25 H on a close basis. This forces us to replace our count with the alternate.

Cycle b wave obviously requires additional work. I show a double zigzag currently tracing. This entails two sets of ABC's with an intervening X wave.

We should be finishing up another primary [A] wave very soon, if we didn't on Friday. At completion, a primary [B] should ensue with the final [C] following.

[Y] = [W] at 1263.75. [Y] = 61.8% of [W] at 1066.125, which would be the minimum objective. The 78.6% retracement of a sits at 1148.25.

I suppose that the old count could theoretically still be alive, however, it looks so goofy that I give it low odds.

IF price somehow were to get back to the 1336.50 H, then obviously something is very wrong. I guess we can cross that bridge, should we need to, at that point in time.

All prices basis continuous contract.

CORN
The corn market remains in its downtrend.

It is unclear if corn has finished this corrective or not. I have left the retracement levels on the chart if price needs additional time and/or price to complete this counter trend move.

It is also possible that primary wave [4] needs additional work. A triangle could be tracing here. If so, this leg would appear to be (c). If a triangle, price should not exceed the 373 H.

Assuming that [4] is finished, the first order of business would be to break the 312 L. The first intermediate degree target is 279, which is where (3) = (1).

The minimum primary objective is the 61.8% projection of [1] - [3] at 278.125. [5] = [1] - [3] at 219.50.

All prices basis continuous contract.

WHEAT
The wheat market continues with its dowtrend. It appears that it traced out a corrective flat this week and is ready to resume selling.

I am not sure exactly what finished at the 486 L. I have had an intermediate (1) of (5) label, but it very well could be wave (3). My guess is that the pivot low is most likely wave (3).

Regardless, this downside structure is nearing completion if my interpretation is correct. I have introduced a new alternative count, which is a much more bearish count.

It has wheat in primary [3] currently. This count would portend much lower price. This view, I believe, is a lower probability outcome.

The first order of business is for price action to take out the 486 level. This would confirm that the corrective is indeed finished.

IF we have completed a 1 and 2 off the corrective 517.25 H, then we have minor degree targets at 475.25 (161.8% projection) and 453.25 (261.8% projection) respectively.

Primary targets include the 61.8% projection of [1] - [3] at 465.75, which is our minimum objective. [5] = [1] - [3] at 391.50.

All prices basis continuous contract.

Crude

Very nice reversal for crude off the morning lows. Volume was better than yesterday, but nothing to write home about. Range was $3.12.

There are several ways to label the structure down to the 69.83 L. More than likely it was a flat-x-zigzag, but it makes no difference. The important point is that I believe that minuette (b) has completed.

We are impulsing up, which is exactly what should be happening. My interpretation is that we are tracing a double zigzag for minute [b] wave. This should be the last (c) leg that will finish [b].

If this assessment is correct, we will see higher price, and possibly yearly highs. AB=CD at 77.85. Should we reach that level, we would attain new recovery rally highs.

Notice the nice hit of the 261.8% projection. We also sniffed the lower boundary of the daily channel.

RSI had a monster positive divergence at the 69.83 L.

It appears that we have finished micro [1] - [3] and are currently working on [4]. There is a chance that the degree's should be ratcheted up by one. I have the retracement ratios on the chart.

We should finish up [5] in quick order tomorrow that will complete sub-minuette i.

My channel assumes that [4] has made its low. There is a good chance it has not. I will adjust the channel if needed.

ES

The equity markets had a nice recovery after early morning weakness. We had a 18 handle range and volume was better than average.

It appears that we are impulsing up from the 1014.75 L. Outside of the 1st wave everything is nice and clean.

I have caved in and will assume that minute [iv] has finished at 1014.75 (notice the 38.2% retrace). The big reason has to do with how crappy the internals are. I just can't believe that we would be ready to launch with where the internals sit.

Take a look at the daily candle registered again today. I know I have been referring back to the mid June period a lot, but look how similar structure is. The chart is telling us something folks.

I would like to say that minuette (i) finished at today's high, but I believe that 1032.75 finished sub-minuette iii. We should see one more push higher to complete (i). This of course assumes I'm correct in my assessment of structure.

Pay attention to price action when we get to the mid-line.

Near terms targets include the 61.8% projection of [i] - [iii] at 1039.50, while [v] = [i] - [iii] at 1046.50.

I do believe that price works its way higher, however, I no longer think we will get as high as I originally thought.

On a totally different subject, I couldn't get on eChat today. Have we shut the room down? Perhaps someone would be kind enough to post in the comments.

Edit: I forgot to mention the dollar's action today. Complete crushville! What the hell happened? Somehow it held support, but it doesn't appear it will for long. I believe were now down to a 1 outer - at best.

Edit: I came out very well on my globex trade. Had my stop in the right place :)

ES Intraday

There is definitely no triangle in play. This is what I'm currently looking at.

It appears that we are impulsing off the 1014.75 L, however, I really don't like what would be a sub-minuette i wave that started us out.

Nice hit on the 38.2% retracement. The 1:1 came in at 1014.25.

The minute degree waves may or may not stay.

Notice the nice channel action as well.