(Note to self: if the market truly had set a long-term bottom in March '09, there would be little, if any, talk about "correction" at this point following last year's sell-off. Instead, the talk predominantly would be filled with trepidation about a return of the bear market. Never forget that...)
Well, this week so far is proceeding as anticipated. Psychology's momentum (presented Monday via the NASDAQ McClellan Oscillator) is returned to a more balanced state, buyer versus seller. And Monday's wide gap lower in market leader NASDAQ has yet to be filled with this week's school of suckers.
Completion of an a-b-c Elliott corrective wave off Monday's bottom awaits but wave 5 of c. You see quite typical RSI behavior during the formation of wave c's first four waves.
Odds are once wave c is completed, it's to the floor we go, finishing the week at a new low (still, probably about the 50-day moving average, though).
Q: Is next week shaping up to be a disaster (the kind that makes for a quick hit stock index options play)?
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Analysis centers on the stock market's path of least resistance. Long-term, this drives a simple strategy for safely investing a 401(k) for maximum profit. Intermediate-term, investing with stock index tracking-ETFs (both their long and short varieties) is advanced. Short-term, stock index options occasionally offer extraordinary profit opportunities when the stock market is moving along its projected path.
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