Last week I wrote: "The gaps at the start of wave A are still not closed. This is a bad sign because, if it is not happening now it may take a long time in the future pointing in the direction of a long term downtrend reaction. The first targets are the 100 average and the price support around the same level, next the 200 average and again more price support existing at that level. Medium term we should expect a wave C down past the low of wave A around 2450. That would complete the C-wave with the same size as the A-wave. Read my updated comments here for the weekly chart and monthly chart for more information regarding the longer term view."
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The gaps at the start of wave A are still not closed. This is a bad sign because, if it is not happening now it may take a long time in the future pointing in the direction of a long term downtrend reaction. The index went below 2700 and closes the week lower at 2718. There is support from the 100 day average, the low side of the volatility band and previous gaps and price levels. There is also a hidden divergence with a higher index bottom and a lower indicator bottom. We can expect some further correction the coming week(s). Possibly we will see a wave 2 retrace. In that case the index will stay below the top of wave b. Medium term we should expect a wave C down past the low of wave A around 2450. That would complete the C-wave with the same size as the A-wave. Read my updated comments here for the weekly chart and monthly chart for more information regarding the longer term view.
Sylvain Vervoort http://stocata.org/