Thu 10/11/2012. Daily Update.

(Update Thu 10/11/12 4:15PM EST)
The Score is back to neutral. Small SOS day. SOS and BOW days have been occurring with a lot more frequency than normal in the past couple months. I suppose that indicates indecision and probably churning and distribution. A possible small EDT or series of 1-2s completed near the close so we're likely to see a sharp 10pt move tomorrow morning in one direction or the other. We'll just have to see what happens and how it affects the System indicators. For now, we are kinda stuck in a long I don't like, but I still think a C-wave up to 1444+ is very possible. Good luck.
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Current Position: Long at 1442.53
Next Action: Stop at 1425 (subject to change)
Score (0-10): 6=Bullish=Trend Score + Turn Score=4+2

The System closed its previous short trade with a 20pt gain (entry 1460, 25% exit 1432, 75% exit 1443) and entered long at 1442.53. My sense is that SPX is bouncing in an ABC with wave A likely completed at 1444, so wave C will likely end at 1444-1454 near the 89hEMA/SMA and/or 20dSMA. That doesn't make for a good risk/reward trade to me, but that's the hand we were dealt. Would it shock you to see SPX take off higher given months of levitation and buy-the-dip? That levitation will come to an end and I think now may be the time, but we just don't know for sure. For now, the stop is set just below the 50dSMA and recent 1430 pivot at 1425. The Score may turn more bullish if SPX trades back down near 1430 for a few hours which would fit with a C-wave bounce, but the bearish floodgates would likely open below 1425. Good luck.
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Current Position: Short from 1459.50
Next Action: Stop and go long at 1442.53
Score (0-10): 6=Bullish=Trend Score + Turn Score=4+2

No change of plan. At first, I realized that the Turn Score did not turn as bullish as I expected which eliminated the long signal at 1442.53, but then I just remembered there was a large BOW yesterday nudging the Score into slight bullish territory. By rule, that means the System will go long once 4-hour resistance is broken. I personally don't like the trade, but the System has done well. So, if SPX reaches 1443, perhaps it will trade higher to the 89hEMA/SMA at 1447-1448 or the 20dSMA above 1450, but I suspect it will fail after piercing those levels and the System will end up short again very soon. Sorry for any confusion. I currently manually calculate everything. Go with the flow. Good luck.