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Keene Little : 12/16/2007 10:40:01 PM

Monday's pivot tables: Link and Link

The similarity between the indices favors the same wave count between them and currently it's potentially very bearish. The RUT probably has about the cleanest wave count at the moment and it looks like a 3rd of a 3rd wave down has started (from Thursday's high). The first downside projection for this is down to the 730 area which is just below the November low: Link

I show the possibility for a bounce back up to near Thursday's high (770 area, shown in pink) to complete a larger a-b-c correction from Thursday's low (the lower low on Friday does not negate the possibility for what's called an expanded flat correction but it requires an immediate rally on Monday morning). Any continuation lower on Monday should have you looking to short all bounces (which may be small until it gets down to 730).

The others have the same pattern and the same bearish setup. The market must rally right away on Monday or else look out below.
DOW: Link
SPX: Link
NDX: Link

Note that the key levels are the same for all of them--the bulls need to break above last Wednesday's high to negate the bearish wave counts; the bears need to break below the Dec 4th lows to negate the bullish wave count possibility. A break of those lows would put the bears firmly in control of this market. Since we're closer to the lower levels, keep an eye out for the break down through the following as bearish confirmation (until these break stay aware of the potential to start rallying back up):
DOW: 13238
SPX: 1460
NDX: 2048
RUT: 749

OI Technical Staff : 12/16/2007 9:59:59 PM

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