Following on from the ES charts yesterday I thought it would be useful to compare the two. Looking at the weekly charts it is strikingly obvious that the Nazdaq is completing the 2nd leg higher of an AB = CD structure.
Leg 1 AB - 1017.75 to 2058.25 or 1040.50 points
Leg 2 CD - 1697.75 to Target at 2738.25.
We can also see that the CD leg is itself constructed of an AB = CD pattern with harmonics.
AB - 1697.75 to 2435.0 (737.25 points)
BC - retracement of 61.8% to 1972.25
Thus ideally the CD leg should complete in the zone of 2709.25 to the 161.8 at 2721.
Clearly we have entered the zone where a reversal is highly possible and I will be looking at the lower frames for reversal signals.
Weekly wide view
Weekly close up
Friday, 16 March 2012
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