Semiconductor index leading markets down

Most of the indexes closed down on Friday continuing to confirm the downtrend. Small stock indexes very often go down before large stock indexes such as the S&P index. A small stock index would be the Russell 2000 index. Another small stock index is the SOX index. This is the semiconductor index. This index is the first index to close lower than its previous low. The significance of this is that this index if full of stocks in the Nasdaq index. So, the SOX Index will drag the Nasdaq index down. However, it should be noted that not all Ellioticians agree with this scenario. Caldaro, a noted Elliotician, thinks that we are really in an uptrend. He bases his opinion on the wave count. He sees five waves up from March '09 to April '10. I see only three waves up during this period. Ellliot theory states that 5 waves up would indicate an uptrend. Three waves up indicates a corrective move and is therefore a downtrend. Time will tell whether we are in a downtrend or an uptrend. Stay tuned.