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Thursday, July 8, 2010

S&P 500 - The correction became stronger that expected

We knew that a more complex correction was unfolding, if prices broke above 1,038, but the rally became stronger than I expected. Breaking clearly above 1,048 and 1,054 has turned focus to 1,065 - 1,066, where wave (ii) will be 78.6 % of the decline from 1,080.30 to 1,011.53, but at the same time wave c of the second a-b-c rally will equal wave a in lenght.
When wave c is done, the next impulsive leg lower should be seen.

At no point should we see a break above 1,080.30 as that would change the count completly.

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