AAPL Joins GOOG, Heads South

Time for an ewave roundup, especially with everythin' headed south.

GOOG has been in a steady decline, and so as AAPL, although this has been less noted in the press.  It bodes poorly for a market when its leaders break down, especially as these two have counted for much of the market value gain in the last few years in tech stocks - much more concentrated than in 2000. 

Gold has also taken a tumble, and seems in a direct line to drop $100 or so from its recent high.  So too have fallen many commodities.  Indeed, pretty much across the board, with the exception of the Dollar, which is showing signs of heading back towards its target of 100 on the Dollar Index. 

Stocks, however, have seen their downward momentum soften, and we could be approaching a near-term bottom, around Dow10.7K/SP1245.  The STU put out an interim bulletin today analyzing the current situation, suggesting an approaching bottom, but adding a Cautionary Note: the headwinds are blowing south, so the market is more likely to surprise to the downside than the upside.  Brainfood notes how this is how the market felt when it broke down in 2000.  Neely sees the next 30 days as volatile, including possible downside, although with a higher high coming before the end.  Zoran has returned from a monthly quietus, and sees us approaching the Maximum Point of Confusion - which is when the market picks a direction and bifurcates with a vengeance.  He sees a rising wedge from 2003 predominating the wave pattern, and hence is bearish - the next bifurcation should end the bullishness since Mar03. 

Happy trails!

Comments

[tony caldaro]

Think we're approaching a short term low at least, as well. Looking for NDX 1634 and SPX 1249 for a bottom, or a rally above todays highs. Have a nearly completed 5-3-5 zigzag from the Jan highs in both major indices.
tony

[LS]

The market seems to be correcting in a zig zag as tony pointed out. What makes me question this count is the overlaping moves in the major averages from Feb 2 to Feb 7. Also, the sub-averages (russell2000, nyse, xau...etc.) peaked out on the x wave of the zig zag. Could this just be a running wave two during the period noted above? I don't know but if the markets move down dramatically at the end of this overlapping then we may have a top in. The XAU as noted in the previous post by Yelnick has turned down from a long-term third high and will likely move down considerably from here.

Happy trading

[Jimmy James]

Yep. This is a third wave crash alright. You know how you can tell?

During wave 1 down (2000-2002) the NDX used to routinely sell-off 3-5% per day. Now that wave 3 has started, the selling is so vicious that it has taken 3 weeks to sell-off 5%.

[Joseph Russo]

Russo weighs in with an excerpt from Elliott Wave Technology's NEAR TERM OUTLOOK.

Russo's stellar and consistant guidance continues to balloon the accounts of all EWT subscribers. Check the latest stats and testamonials at his stockcharts link @ http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID676791

from EWT's NTO....

PROSPECTS FOR NEAR TERM ACTION IN THE DOW :

Comments:
"The Dow is under pressure here as key power uptrend support is under test. RSI is taking its sweet time in getting overbought basis the daily chart, while the MACD sinks back below zero. We have an apex in February that may mark a low or a high. Right now, the reflex is for a low, however sentiment can change on a dime if enough of a wash out occurs. The market is subject to a sharp rally at a moments notice though things appear rather bleak at the moment. Should we breakdown below the January lows, the H&S/Diamond pattern target of 10360 becomes more probable. Continued weakness along these lines in the weeks and months ahead will near about guarantee a retest of 10K. It is at a failure of the 10K level that the Dow will become susceptible to more serious damage. Beyond the maturity of the cycle at hand, we are experiencing nothing more than a garden-variety pullback from the October/January advance. Further price action going forward shall soon telegraph the markets true intent."

end NTO excerpt.....

EWT is niether bullish, or bearish. Instead, we remain as always - "Matadorish"

It takes two baby... Read I,MATADOR to find out exactly what we mean... It's a "slow read" so take it easy...
http://www.financialsense.com/fsu/editorials/russo/2006/0208.html

[tony caldaro]

GOOG is very close to a bottom or has bottomed. Most oversold the stock has ever been. Possibly new highs by April ... Tony

[Paul]

New highs by April? It has a long way to go before that happens. Market has been known to be volatile in April. In the long run, I think the stock will implode. Googles market cap is a freaking $100 billion. There's no way an internet company who makes it's sole income from ads is worth that much.