Market update; why I.I. turned bullish on Wednesday and why to spell this correction as ” O P P O R T U N I T Y”

While many were running for the exit doors on Wednesday, I.I. provided its members with a special update AH on why to be bullish. You can read this here:

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Dear I.I. Members,
Today was a blood bath all around it appears. But, at the end was it all that bad? Let’s have a look:
1) actually today market breadth (Zweig Breadth and McClellan) improved over yesterday! NYSI dropped a bit more to -626, which is just below the August 2011 low.. and the A/D line was essentially flat (12964 yesterday, 12960 today)
2) many individual stocks saw an intra-day turn around going from red to closing green!
3) today saw the largest intra-day “bounce” and left a big bullish hammer candle on the daily!
4) several indices -wlsh, nyse- were more oversold today then they were even during the major a low of Primary II in August 2011…
5) price hit just below the 1827 price target of the 1.618x extension of intermediate a (2019->1926), measured from the intermediate b high (1978):  1978 – 1.618x 93 = 1827. The 1820-1834 area is massive support and it held. [Added here: On the ES it hit 1814, which is exactly the 1.618 extension, while yesterday I showed the WLSH5000 also hit the 1.618x extension exactly]
6) price has now moved down in 9 waves from the October 8, SPX 1970 high [Added here: which is 11 waves from the 1978 high and thus can be counted as complete]. I thought after 5-waves it be done, but then it added two more, and then it added even two more to that: 1970-1913, 1913-1936, 1936-1890, 1890-1912, 1912-1874, 1874-1898, 1898-1837, 1837-1867, 1867-1820. Each bounce was between 22 and 30 points. The move from 1820 to 1870 was 50 points and that doesn’t fit the pattern anymore.
7) the move from 1820 to 1870 counts best as 5 waves up.
8) for the INDU the trend line connecting the October 2011 Primary II low with the November 2012 low held. This is the last stand between a drop to the trendline that connects the 2009 low with the 2011 low.
9) Assuming that in all likely hood major a bottomed, we should see major b retrace 50-62% ideally. This targets a 100-125 points up move: 1920-1945. However, given how OS the market has gotten it may even shoot higher. But let’s not get too greedy for now.
10) The A.I. gave a buy signal today.
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In other words, and as W.B once said: “get greedy when others are fearful, and be fearful when others get greedy”.  He’s been buying this correction, and last time I checked he’s doing mighty fine. So why shouldn’t we buy this dip too!? Hence, instead of following the herd and be fearful, see this correction as a longer term OPPORTUNITY and become greedy.
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One thought on “Market update; why I.I. turned bullish on Wednesday and why to spell this correction as ” O P P O R T U N I T Y”

  1. Pingback: WLSH5000 update: price now in my preferred target zone as layed out last week. What’s next!? | Intelligent Investing

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