I have published the Regular Scheduled update for Thursday early.  Due to the new high and the current position of the markets I am making this update available to ALL who wish to read it. 

ShepWave has had a profitable of trading so far.  We did, however, miss the 'incredible' rally from July Lows.   We have  been labeling the up trend from July Lows as a wave 2 correction from the May '06 highs.. This was obviously wrong.  So what do we do now?  Number one we have to alter our Preferred Elliott Wave Theory counts.  Remember NO Elliott Wave Count is final until the next cycle begins.  It is for this reason that I don't 'mess' with the short term counts too much.  It tends to only confuse people and they usually end up having to be changed anyway.

So let's start with some longer term analysis and work our way down.  In tonight's update I am gonig to primarily use the charts from the S&P 500 index to show my points.

CHARTS REMOVED

 The weekly chart of the S&P 500 index shows the longer term Elliott Wave Theory counts being used by ShepWave at this time.  Are we even looking for the S&P to get close to the highs of 2000?  NO.  Notice the weaker and weaker strength as indicated by the RSI and MACD.. this is not indicating that the new recent highs are made with conviction.  The markets have a tendency to weed out the weak shorts and suck in the weak bulls.   ShepWave's goal is to enter positions that are set to profit.. but that we can still be ok if the market goes against us for a bit.  This requires 'responsibility' in the trader.  Always enter a position (especially options) assuming you will be wrong.. for a time anyway.  The move we are 'ideally' positioning for is the move that will take the S&P to below the 781 area.  There will be plenty of selling and some brief buying opportunities along the way.. but this is our goal ..... again, according to our analysis.

CHARTS REMOVED

 The daily chart of the S&P 500 index above shows that we broke the highs set in May by a few  points.. Now, the interesting aspect of the daily charts is that we see only slight bearish divergence.  This could indicate that the rally is NOT over.  Would I be long the markets now?.... NO.. Too Risky based on longer term analysis.  If I were long I would exit some of the positions or put in STOPS to ensure profits.  Notice the highs in May did not have very clear bearish divergence on daily charts either.    Cautious,,, but aggressive traders can still be adding to Short Side positions .. just plan on being wrong for a bit of time.  

So.. enough for the charts today.. I will show TARGETS for subscribers as we get signals.  The Trigger Targets shown in recent updates will need to be changed.  This is due to the new recent high.   I will update as soon as possible with confirmation targets.

The point I want to Hammer On today is the fact that the Dow Theorists out there are seeing a non-confirmation between the rally in the Dow Indu and the Dow Trans indexes.  This DID NOT Occur last May.. So,, with that being said.. a precipitous down turn in still very much a possibility according to ShepWave analysis.

Finally, I  strongly urge everyone to always use more than one 'Technical Analysis' site or service.  Although I naturally feel ShepWave is the best service.  I highly recommend signing up for CLUB EWI.. This is a FREE Service provided by Elliott Wave International.  Also.. I suggest signing up for Prechter's Elliott Wave Theorist.  It is very valuable and tends to show the underlying reasons for the actions in the markets.

Click the image below to sign up for CLUB EWI.. IT is FREE.

God Bless You and your Loved Ones.

Shep