S&P 500 Sep e-Minis ~ (240 min.

)
(Z)
“y” This would be an “idealized” result of the wave count…It’s easy to see why it could be a “choppy” and
“unpredictable” type of ride to finish off an Intermediate (B) wave. This would be considered a “good
result” for bulls--it would be a decent, albeit grinding rally into Nov-Dec which would set up a crash to
begin 2011. It is because of this sort of “whipsaw” possibility that we have not done much with the
S&P500, except for maintaining a 20% (of maximum) short position.
b
(B)
“c”

“x” “a”
c c

b
a a

a
CRASH

b a
c b
“w” c
“b”

“y” REPRINTED from 8/22/2010

(A)

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Sep e-Minis ~ (240 min.)
(Z)
“y” The idealized chart pattern presented last week remains ‘alive,’ with the market holding a very nice
area of support this week. There are probably bulls who are imagining the Head and Shoulders bottom
look to this pattern. In fact, if the market were to follow the “path of greatest pain for all,” it would look
a lot this forecast, with a failed neckline break to the upside. As it stands, it looks like we may have
completed wave-a of “b” this week. Some sort of b-wave rally for the next several days should not
b
surprise. At this point, the wave down from the “a” peak does not look like an impulsion lower, so the
subsequent b-wave rally MUST retrace at least 60% of the a-wave. Read: It could be a decent “hop”
this week.
(B)
“c”
“x” “a”
c c

b
a
a
a
CRASH

b
b a?
c c
“w” “b”

“y”
(A)

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Sep e-Minis ~ (60 min.)

“a”
c
-5-

-3-
(b)

a (a)
-x-

-1-
-4-
(b)
1076

(c)
(a)
-w-
-2-

b
(c)
-y-
a?

This would be the wave count that finishes the move down for the a-wave. This is the same
preferred model we highlighted last weekend. Breaking above 1076 would confirm this wave
count. Breaking below last week’s lows would negate this wave count. Mr. Market will tell the
tale early this week.
(A)

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Sep e-Minis ~ (60 min.): Uber-Bearish Model

“c”
c
-5-

-3-

-1-
-2-

-4- (2)
1076

(4)
-1-
(1)

-2-
(3)
-3-?!?
A case can still be made that we’re in the middle of an “impulsive” move lower, but a break above 1076
would KILL those bearish ideas. In fact, any further strength to begin the week ‘should’ negate this model
because a Wave (4) should not overlap with a wave (1), but I’m going with 1076 as the KILL level just in
case we completed a Wave -3- this week, and it’s simply not evident on the chart. The bottom line for
Wavers is this: The move down cannot be counted as a completed “impulse” of any kind. So, ‘if’ we
do get a stronger move higher this week, don’t believe any wave counts that try to ‘fit’ this into an
impulse lower.
b

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Sep e-Minis ~ (240 min.)
(Z)
“y”
This is also a pretty decent explanation of the price action. While it is not my “preferred” count, it
does do a better of job of explaining the recent “terminal wedge” pattern that was witnessed. This
would be a very bearish outcome in the near term as we would be in the beginning stages of a
collapse that should last several weeks and drop the market 10-15% from current levels.
b

“b”
-d- c
-5-
-3-

a -b-
-1- -2-
a

-4-

-1-
-a- (1)
-2-

-c-
c
“a”
REPRINTED from 8/22/2010
-e-
b

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Sep e-Minis ~ (240 min.)
(Z)
“y”
This remains my preferred count. It sugggests that we will continue to be in a prolonged period
of “congestion,” as we are smack in the middle of an Intermediate (B) wave. In fact, this would
be the “b” of the (B), which would imply the HIGHEST level of uncertainty and choppiness.

“a”
“x” c
c -5-
(b)
-3-

a a (a) -x-
a -1-

a -4-
b
(c)
-w-
-2- (a) or -y-

b
b
c
“w”

REPRINTED from 8/22/2010 c

“y”
(A)

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Sep e-Minis ~ (240 min.): Support/Resistance Levels
It appears 1130 was the “big hurdle” we thought it might be. It’s amazing how even the simplest forms of
technical analysis (i.e. classic support and resistance points) can yield nice ‘tradeable’ moments. Slide
#4 highlights an alternate, very bearish, count. If that model is correct, the S&P futures should NOT trade
above 1085 , the 62% retrace of the most recent decline. Thus, 1085 is the first level of resistance for the
week. First level of support would be 1051 and then 1036. As well as being “classic” support, 1051 is
also the 62% retrace of the entire advance, so I’m expecting a bounce from that level on the “first go.”

1130

1105

1085

1051

1036

REPRINTED from 8/22/2010

Andy’s Technical Commentary__________________________________________________________________________________________________

 S&P 500 Sep e-Minis ~ (240 min.): Support/Resistance Levels
Key support and resistance levels from last weekend were “money” last week, with 1085 providing early
week resistance and 1036 causing two different ricochet moves which began at 1037. The 1076 level is
the 62% retrace of the wave down from 1098 to 1037 and also wave resistance on the line on close chart
(slide 4). Short term ‘bottom pickers’ might want to use 1054 as near term support with action below
1037 being ‘ominous’ for anyone with length. If the ‘preferred’ wave count from slide #2 is correct, the
market should rally to 1105 area where there will be resistance.

1105

1076

1054

1037

Andy’s Technical Commentary__________________________________________________________________________________________________

 Dollar Index (30 min) (5)
[5]?

REPRINTED from 8/22/2010

[3]?

[b]
(3)
[5] [d]
[3] [4]?
[1]
[.5]
[.3]

[2]
[.4]
[a]
[4]
[.1] [e]
[c]
(1) (4)
[5] [1]

[x] [.2]

[3] [2]
I don’t normally like to look at waves on this small of time scale because there tends
[y]
to be “noise” with the overnight sessions. This is a very interesting wave
(2)* development with a few different ways to consider it. This counting adheres to the
[4]
most number of “rules” of wave theory. One of the interesting implications of this
[1]
[w] model is that the wave (1) and (3) were of nearly equivalent height, which means we
should expect the Wave (5) to be the extended wave. The target of that move would
be 84.60-84.80
[2]

* Wave (2) was a “double combination”

y

Andy’s Technical Commentary__________________________________________________________________________________________________

 Dollar Index (45 min)

[1]
[.b]
[.3]

[b]
(3)
[5]
[d]
[.4] [.a]
[3] [.1]

[.c]
[.2] [2]

[4] [a]
[e]
[c]
(1) [1] (4)

[2]
This is the ‘preferred’ wave count from last week. We have not yet seen the ‘fifth
(2)* extension’ Wave (5). This model requires that the DXY explode higher this
week. A break below 82.60, the 61.8% retrace of the last wave higher, would negate
this count and leave us with the next page….

y * Wave (2) was a “double combination”

Andy’s Technical Commentary__________________________________________________________________________________________________

 Dollar Index (45 min)

-1- or -a-
(5)
[.5]

[.b]
[3]

[b]
(3)
[5]
[d]
[4] [.a]
[3] [1]

[.c]
[2]

[4] [a]
[e]
[c]
(1) [1] (4)

[2]

A break below 82.60 would leave me with this model. It would mean that we
completed a wave higher at 83.56 and should be prepared for several days of
sideways/lower congestion that could take the DXY down to 81.40.

(2)

Andy’s Technical Commentary__________________________________________________________________________________________________

 10 Yr Note ~ Continuous Daily Futures
One of the reasons I don’t do a lot of analysis on the treasury notes/bonds is that I don’t 3?
have a good ‘feed’ for interest rates, which is the best way to model such instruments.
Charting futures on notes/bonds have a lot of “issues,” but there are a few interesting things
about this current development. The most noteworthy item is the Daily RSI divergence
triggered on the new high last week, followed by the engulfing candlestick. This looks near
term bearish--10 yr note holders should be braced for lower prices over the next few weeks. 1?

2?

Notice how the market lapsed into prolonged sideways congestion right in the middle of the
wave up. This is bizarre looking behavior that would cause me some ‘restless’ nights if I
were SHORT notes. The near term action suggests a bearish bias, but it’s WAY too early to
call a major top in the Ten Year.

Andy’s Technical Commentary__________________________________________________________________________________________________

 DISCLAIMER WARNING DISCLAIMER WARNING DISCLAIMER

This report should not be interpreted as investment advice of any

kind. This report is technical commentary only. The author is Wave Symbology
NOT representing himself as a CTA or CFA or Investment/Trading
Advisor of any kind. This merely reflects the author’s "I" or "A" = Grand Supercycle
interpretation of technical analysis. The author may or may not I  or A  = Supercycle
trade in the markets discussed. The author may hold positions <I>or <A> = Cycle
opposite of what may by inferred by this report. The information -I- or -A- = Primary
contained in this commentary is taken from sources the author (I) or (A) = Intermediate
believes to be reliable, but it is not guaranteed by the author as to "1“ or "a" = Minor
the accuracy or completeness thereof and is sent to you for 1  or a  = Minute
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is not for everyone. (1) or (a) = Sub-minuette
[1] or [a] = Micro
Here is what the Commodity Futures Trading Commission (CFTC) [.1] or [.a] = Sub-Micro
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