Last week I wrote: "We had the retracement only on Monday, straight to the S1 pivot support. Next 3 days an up correction followed by a retracement on Friday from the resistance of the upper side of the slower downward pitchfork channel. I have to repeat what I mentioned last week: a new higher high is still possible as a result of the hidden divergence between the index and the indicators and the index not reaching the median lines of the downward pitchforks. On the other hand it looks like there is a convergent move building between tops, which points in the direction of a further down move", but a move up with a new higher high for a wave 3.24 towards the R1 pivot level seems to have a good chance".
Last week I mentioned: "On the other hand it looks like there is a convergent move building between tops, which points in the direction of a further down move". It looks like this top will be confirmed with an extended correction wave 2 for the last up wave 3.23. If this down move is confirmed the coming week, the index is on the way to a first wave 3.1 down. This will bring the index back to the S1 pivot support of June and further to the median line of the longer term downward pitchfork, the low side of the volatility channel and the 200 day average. The possible creation of the wave 3.1 down would be a first strong indication that the distribution ends and the long term down move has started. We have to wait for this wave 3.1 down to be sure that wave 3.23 up is a top wave for the longer term. Be prepared...
Sylvain Vervoort http://stocata.org/