2010-09-29_1930_DJ_10min_Ending_Diagonal

Another reason for being cautious about the immediately bearish count is that there are other ways to explain unclear direction. Recall from yesterday’s update that we were looking at the idea of an ending diagonal to explain movements into a possible lasting high. Ending diagonals are characterized by indecision, which is why they put in three-wave movements in both directions. So the lack of a direction observed on Wednesday may be an indication that we were in a larger ending diagonal which isn’t yet complete. If this is what is unfolding then we would expect at least one more trip above the 1932 snow line to a new high before falling.