9/28/20089:46 PM Pacific

What do you know… the expanded flat looks to be the correct interpretation after all. It is hard to figure how a wave will play out sometimes. It is like catching a bus from California to NY and not knowing the scheduled stops in between. I am sticking with my preferred thesis that we bounce before we take out the low. If you look closely, that means we cannot retrace a full 1:1 ratio of the 5 waves down from c at 1714. I am guessing it will be my new favorite bear market ratio, .810. After the bounce we should go higher than 1801. A 1:1 ratio of the 5 waves up from the low is 1810. However, if we take out the low at 1604, I will target 1551 shown by the red arrow. This is the back up thesis if we take out the low. The wave up from 1604 to 1801 has excellent ratios for a motive wave so I put a higher probability on the bounce.

9/28/20089:46 PM Pacific

The ES is following the exact same pattern, except that it has a lot more retracement room before taking out the low. For that reason, I am going to focus on the NASDAQ e-minis, because it will sound the alarm first if I need to switch to the back up thesis.

DW/TMD The market detective provides personal market opinion based on sound technical analysis and research. However, no warranty is given or implied as to its true reliability. The market detective will make errors and mistakes. The market detective is not an investment adviser and is not making recommendations to buy, sell, or place orders relating to the futures contracts, ETFs, or stocks that he writes about. The responsibility for decisions made from information contained in this service are solely that of the individual subscriber. The individual must fully research and make his/her own decisions before acting on any information provided by the market detective. The market detective assumes no responsibility for subscriber investment or trading results.