Last Wednesday we provided a chart of the QQQQ (NASDAQ 100 ETF) projecting a minor trading range creating wave B in an ABC correction. Yesterday the B wave concluded and the projected C wave down began. Now realize that we take Elliot theory with a grain of salt and believe that its predictive power is more a myth swallowed by the true believers than it is a reality. However, sometimes patterns do repeat themselves in the market and when we are able to recognize this occurring it can lead to really great trading opportunities. So far the ABC correction we are now experiencing is mirroring the same type of correction that occurred during the month of June. It is too early yet to buy, but when the QQQQ hits its trend line at the $38-level it will be time to start buying the down days. We are looking for about a week of consolidation at the trend line so don’t get overly anxious looking for a quick bounce. Instead, use this as an opportunity to get positioned for what should be a strong move off of heavy support. The market is very oversold already and shorts are likely to pile on at this level. In our opinion it is too late to short for longer than a day trade, but the shorts that do enter at these levels will add much fuel to the reversal once the market hits support. Meanwhile, options week is playing havoc with the commodities sector and the dollar’s dead cat bounce from a deeply oversold condition has slowed momentum in the metals sectors. We believe this is temporary and that we will see the metals start to regain some momentum now that some of the pressure has been taken off of the dollar’s slide. The oil correction should lead to more buying opportunities since it has not yet created a topping pattern in a very strong trend.