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Trade Trends with Bollonger Bands and Twiggs Money Flow

Archive through November 29, 2010

Chart Forum » Hilarius' Hall Of Fame » Elliott Wave Watching » Archive through November 29, 2010

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ehmu
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Wednesday, November 24, 2010 - 07:41 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Back in September, I went in search of a footprint. The footprint of a band of rats, otherwise known as the agents for a not to be mentioned Federal Reserve Bank.

What I came up with at that time was a channel for the SPY that almost always seemed to find buyers when price hit that support, and usually relaxed when price reached the resistance of the channel.

I theorize that when the plan was in its infancy that this was a fairly clear cut pump to operate. As it grew in time, some became greedy, or the plan was leaked, and speculators were able to capitalize within the boundaries of the channel.

The noble cause of the Bank was of course to prime the markets until such time as a healthy pulse was restored and the markets could again fly freely on their own.

Prices did wander higher than resistance for about a month from October 11th, but have corrected now to be basically resting on the support of the original channel that I had marked. This may have been a contrivance of the agents to convince the bank that their plan was working.

I haven't moved these lines since I first plotted them, but I have installed four arrows to highlite them. The original color that I chose closely resembles organic sludge, which was a little difficult to see.


If the base of the channel is broken, I would say that the bank is either beaten at their own game, or has withdrawn the plan. I give this breakdown about the same chances as a snowball in hell of ever happening, since this particular bank has the world currency by the tail and is propelling it off of every available barrier, in every conceivable confine.

1158 was the break out of the falling trend line (and pennant pattern), as well as a resistance level on the weekly and monthly time frames.






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ehmu
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Wednesday, November 24, 2010 - 07:54 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



I just noticed something else that may be significant.

We have touched for the second time the 61.8% retracement of the drop between Oct 07 and Mar 09.

It would not be unusual to correct to the 50% level, which happens to be the 1129 that others are mentioning.










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rdumas
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Wednesday, November 24, 2010 - 08:59 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Hal,

Some very astute observations there. Notice how significant the 38.2%, 50.0% and 61.8% Fib retracement levels of the 2007/2009 plunge all were.





If we did happen to go down to the 50% level then the wave 1 territory would have been breached and I would then be looking for a move down to around the 1010 level (38.2% Fib level is 1014.14).


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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rdumas
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Wednesday, November 24, 2010 - 09:37 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Fibonacci level targets for XJO wave C





I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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billt
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Wednesday, November 24, 2010 - 10:43 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Andrew's long stop date of 29 November for a bottom to this cycle, looks a pretty solid target given the multiple W%14 alignments, considering the recent price action towards a zig zag abc.

Does that look reasonable Rudy?






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ehmu
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Wednesday, November 24, 2010 - 11:51 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)




rdumas wrote on Wednesday, November 17, 2010 - 09:52 am:

1129.24 needs to be breached before it is invalidated




I'm a little concerned that our precision regarding levels is in disagreement.

You see the peak of wave 1 at 1129.24. You used daily candlesticks.

I see it at 1121.64. I used several methods to determine this level:

I used weekly line charts (the close).
I used daily line charts (the close).
I used the same charts to draw the fib retracements.
I used the same charts to draw the pennant pattern.
I used daily levels where sellers took control. (candlesticks)
I used weekly level where buyers gave up control. (candlesticks)

the 50% fib intersects 1121.64
the apex of the pennant pattern intersects 1121.64
the peak of wave one is 1121.64
levels where the control changes are 1121

My idea is that your wave one is not violated or invalidated until there is a close below about 1121 give or take.

I would hate to have a target of 1018.2 because I was expecting a bounce 8 points sooner. It would mean that I would miss my short exit and my entry for the long entry to follow.

But then on the other hand, maybe I should register my software. (heh, heh, he)






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rdumas
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Wednesday, November 24, 2010 - 02:11 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Bill,

I've been out all day. In response to your question, yes the 29th looks pretty solid. As I said in my market wrap some time ago, the period during which I expected a turn date was between the 22nd and end of November. It started to look as if it had come in the week prior but the Delta charts were right after all (assuming that we do form the bottom within the next week).


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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rdumas
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Wednesday, November 24, 2010 - 02:16 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Hal,

Elliott Wave analysis is done on the entire pattern traced out by the price action on the chart of the index, stock or currency being analysed. As such it includes the intraday highs and lows and hence the close price cannot be used to do EW analysis correctly as much of the price action is missing.

If you are using the close price then that is why we apparently have a discrepancy.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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billt
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Wednesday, November 24, 2010 - 03:59 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



If it was not for Andrew’s Cycle work, the NYSE Summation Index & McClellan Osc would have you expecting a much fuller pullback through to the second week of December.

Note the price pattern on the NYSE Composite between mid January to mid May is 'near on exact' in time and price to the August to October sequence (shown as 'gold' wave pattern looking like someone 'rubber stamped' the wave pattern) – what followed in May was the 'flash crash' and the remainder of the 20% correction south.

The Summation Index looks very similar in print out to the May correction. A 'flat top' then a big dip south...

The NYSE McClellan has just reversed at the -25 level, just as it did in the May correction… Prior to that the McC had topped mid rally then oscillated sideways during the concluding stages of wave 5, before the crunch south, a recovery back to -25, then a sharp turn south again....both very similar patterns...

If the pattern continues stand-by for Mr Fat Fingers, and wave c!

Could the 'low' extend out another 3 weeks to complete wave c? Might it run 'late', then a Santa Rally Wave C to the 2011 high?





...and if you remember, back at the end of April / early May

- Commodity Indices, Oil Indices, & Financial Indices pulled back >10% before the more substantial SPX correction south. Commodity Indices, Oil Indices, & Financial Indices have just completed the >10% correction;

- Gold reversed for 7 days, then put on +$100 to reach a new high. So far we have had the 7 day reversal and are now +$50 higher and rising,,,? ETF Gold has posted a 4 month closing high today - will it rally 30% as it did in the May correction.(rising $USD, falling $AUD, POG rising fast as the flight to safety??)




Perhaps 'One Big Coincidence' - but worthy of some consideration...


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ehmu
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Thursday, November 25, 2010 - 01:28 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)




rdumas wrote on Wednesday, November 24, 2010 - 03:16 pm:

If you are using the close price then that is why we apparently have a discrepancy.




Thanks Rudy:

That explains why I'm in a quandary with EW a lot of the time.

In the back of my mind, I have discounted the lower order waves that occur intraday.

I'm thinking also that the uncertainty of EW'rs sometimes comes from including the wicks.




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ehmu
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Thursday, November 25, 2010 - 01:36 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)




billt wrote on Wednesday, November 24, 2010 - 04:59 pm:

If the pattern continues stand-by for Mr Fat Fingers, and wave c!




Hi Bill:

Here is an article along the same vain.

I appreciate your hard work, always digging.

http://www.stocktiming.com/Wednesday-DailyMarketUpdate.htm






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rdumas
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Thursday, November 25, 2010 - 07:31 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Bill,

I don't believe that the confusion comes from looking at all of the price action at all. Where the difficulty comes in getting the EW counts correct is that all partially completed or fully completed patterns at the higher level are made up of a mixture of corrective and impulsive patterns. Take the simple impulse wave for example. Waves 1, 3 and 5 are impulsive in nature whereas waves 2 and 4 are corrective. Drill down into each of those individual waves and you have the same issue.

That is why I have said many times before that the biggest problem that an EW analyst faces is 'level confusion'. An impulse wave that has an extended 3rd or 5th wave for example will present itself as a 9 wave pattern. It really isn't a 9 wave pattern but we are actually looking at a 5 wave impulse where we are also viewing the sub waves (ie 1 level down) of one of those 5 waves.

The other problem that EW analysts face (as do all humans) is that we are wired differently. No two people see things exactly the same way. Rather, we see reality through the filters of our personal life's experiences and the personalities that formed part of our initial make up.

There are many patterns that look identical during the early stages of development. For example the first 3 waves of an impulse wave have the format impulse-corrective-impulse. A Zigzag corrective wave has exactly the same format so it is easy to come to the wrong conclusion early in the pattern development especially due to our biases.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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billt
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Thursday, November 25, 2010 - 09:24 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



hi Rudy

That last post was for Hal I assume...

Wave 4s drive ya' mad.... abcde looks favorite again...






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rdumas
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Thursday, November 25, 2010 - 09:36 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Bill,

Yes you are right. I was obviously thinking about something you had written when I wrote the stuff for Hal. It's part of my particular type of dementia that causes me to make mistakes like that.

By the way you have labelled a wave 2 in your post above as a Triangle pattern which is not valid. Remember that wave 2's can be any corrective pattern other than a Triangle.

What is more likely is that your wave 1 is actually a wave A, your wave d is actually a wave B and we are about to dive into wave C. The only problem I have with that count is that I would anticipate a bottom by Tuesday at the latest (ie, end of month) so that doesn't give wave C much time to form.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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rdumas
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Thursday, November 25, 2010 - 11:15 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Bill,

The SPX EW count in the previous post suggests that wave 4 has not been completed and that we still need to complete wave C of an ABC corrective pattern to complete the pattern for wave 4.

The other possibility is that wave 4 actually completed last week (ie, earlier than anticipated) and that we have now commenced the early stages of wave 5. The EW count shown in the chart below is one possible count for this scenario. In this scenario it is possible that we still have to put the finishing touches on the latest wave i before our next down move for wave ii.






I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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ehmu
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Thursday, November 25, 2010 - 02:05 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Bill & Rudy:

I offer up a channelling technique mentioned in "The Definitive Collection". I parallelled a line to line adjoining wave 1&3, and parallelled wave 1&2 from wave 3 to come up with an approximate intercept of 1150 for wave 4.

I don't know if this is significant, but this 1150 level coincides with a resistance level established jan14 2010, which was a wave3 high I believe.

I had this resistance level plotted on my chart from when I used the weekly charts to determine major res/support levels. It goes as far back as the top of a wave crest in mid july of 1998.


Happy Thanks Giving Day






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rdumas
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Thursday, November 25, 2010 - 02:22 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Hal,

The 38.2% Fib retracement level of wave 3 on the SPX is 1155.5 so your level of 1150 is certainly within the ball park of one of the more common wave 4 retracement levels.




I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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billt
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Thursday, November 25, 2010 - 07:19 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



hi Rudy

The last few days since the 1173 low seems to me to be all corrective 3 wave patterns.

Perhaps a wave C leg down to the 1150 level by the end of the month....unless the abcde plays out.

The 5 wave count has run out of time, unless Andrew's cycle runs a week or two late....Wave 1 is a 9 wave off the high, and Wave 2 is a corrective a/b move...but it looks to have run out of time unless Korea goes bang!





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ehmu
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Friday, November 26, 2010 - 03:31 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Guys:

I'm trying to retrain my mind, so this could require some patience.

I'm not sure on my count, but I put it on two extreme style charts so that the differences would stand out to me. I placed the same wave count on a monthly line chart (which uses closing prices), and a weekly candlestick chart that includes all of the intraday extremes.

I feel as though I could learn two or possibly three levels of wave identification, but more is beyond my limitations.








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ehmu
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Friday, November 26, 2010 - 03:31 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Guys:

I'm trying to retrain my mind, so this could require some patience.

I'm not sure on my count, but I put it on two extreme style charts so that the differences would stand out to me. I placed the same wave count on a monthly line chart (which uses closing prices), and a weekly candlestick chart that includes all of the intraday extremes.

I feel as though I could learn two or possibly three levels of wave identification, but more is beyond my limitations.








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ehmu
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Friday, November 26, 2010 - 03:39 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Here is an image of the weekly line chart if that helps, it will have fewer of the peaks shaved off than the monthly.

I would have put it with the other post, but am having problems with the platform accepting three images on a single post.






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ehmu
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Friday, November 26, 2010 - 06:39 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hey guys:

What are the chances that your wave 3 is a wave 1 extension ? Refer to my monthly and weekly charts.




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rdumas
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Friday, November 26, 2010 - 07:40 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Hal,

I'll deal with your last post first as it is a quick response question and will deal with your earlier posts in detail throughout the day because there is a lot in them.

For the purpose of this post we will assume that your overall count is correct. It is not a count that I agree with but is one that some bulls have in place. The count will only be proven conclusively to be incorrect if my scenario of large drops in 2011~2013 take place.

Now in your wave count you have a wave 3 underway (at the level shown in your chart) and it is obvious that the impulse wave forming now will not be the complete wave 3 as it will be far too small in comparison to your waves 1 and 2. So we would therefore say that what we are currently forming is just sub wave circle i of the impulse for your higher level wave 3.

We can then clearly see that the 3rd wave that Bill and I have been talking about is only the 3rd sub wave (wave (iii)) of the wave circle i of your higher level wave 3.

If your count was proven to be correct in the fullness of time, the wave 3 that is currently forming would more than likely take out the all time market high of October 2007. Good luck. I think it's chances of doing that are Buckley's.






I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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ehmu
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Friday, November 26, 2010 - 08:36 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



In the context of your response, is it possible that your wave iii is a part of a wave 1 extension.

If it is, I was thinking that it could retrace to around the most recent C level at some point in time and not invalidate the bullish scenario.

ps If at any point in time you find yourself too busy, or my interest too elementary---I'm happy to refrain. I respect your entitlement to decline and prior commitments of your time.




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rdumas
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Friday, November 26, 2010 - 09:02 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Hal,

I would never find a genuine question raised by a poster too elementary. That would be the height of arrogance. The main purpose of this thread was to learn about EW principles. There will be times when my responses will be delayed because of other commitments or just the fact that many of my charts do take a long time to create. I will respond to your earlier posts later today.

Now as to whether it is possible that your wave 1 may be extending, I doubt it very much. The most common wave extensions take place in waves 3 or 5. They don't happen anywhere near as often in wave 1's. Note the magnitude of your wave 2 compared to the magnitude of the preceding 5 waves that made up wave 1. There was obviously a wave created at a higher level than the previous waves.

What is a possibility though is that wave 2 may not be complete and it has only formed waves A and B of an ABC corrective pattern for a completed wave 2.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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rdumas
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Friday, November 26, 2010 - 12:00 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Hal,

Here is an attempt to comment on your earlier longer term EW counts. I think that you have done a great job at putting a wave count together. It is important to note that in your counts you have some pretty large waves within your wave 3's that have not been accounted for. All significant wave patterns should be counted.

Note that the issue is that the waves in the middle of your wave 3's are large overlapping patterns that are not valid.





In the wave counts below at least we have counts that appear to obey EW rules. Now you will note that I have added some higher level waves to the wave count. Note that I am suggesting that the ATMH in October 2007 was Cycle level wave III which implies that we are currently forming a Cycle level wave IV. I should note that a pedantic EW analyst would probably say that I should have labelled my waves (3), (4) and (5) as Primary waves Circle 3, Circle 4 and Circle 5 because they are at the same level as Primary waves Circle A and Circle B but I think you will get the picture of what I am attempting to show you anyway.

The GFC plunge between 2007 and 2009 was Primary wave Circle A and we are in the process of forming Primary wave Circle B.

In contrast you are suggesting that the March 2009 rally commenced a new bull market (ie, impulsive move).





One of the issues I have with calling the March 2009 rally a new bull market is that whilst the pattern from March 2009 to April 2010 was a 5 wave move, the first wave of that move was not an impulse wave.

The following chart which I pulled out of one of my 2009 market wraps shows the move from March 2009 to October 2009 just to show you the high degree of overlapping that took place in that first wave. Ignore the title of the chart but just look at the pattern of that first wave. Note the high degree of overlapping that takes place throughout the extent of the wave which gives it the personality of a corrective wave rather than that of an impulse wave.

If the first wave of the March 2009 rally was a corrective wave then it stands to reason that the entire move from March 2009 to April 2010 is in fact a corrective wave pattern.






It will possibly not be until late 2011 before we will know whether my count is correct or that of the bulls like PUG and Anthony Caldaro. In the mean time all we can do is attempt to make money out of the rallies because they will occur regardless of the count.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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rash
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Friday, November 26, 2010 - 12:30 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



A very interesting conversation - and the raison d'etre for EWW's existence.

But if I could have a quiet word with Hal the Elk Eater without disturbing the academic rules, too much.

You'll note, Hal, that Rudy's restructuring of your initial count leaves "smaller level" EW declines that are FAR larger than the higher level wave counts.

I'm not sure of the exact labeling ... so I'll put it in everyday terms, rather than minuette and minor ... what you've got are a couple of baby Hondas that are bigger than bloody Cadillacs!

It's why poor dopes like me have trouble getting to grips with the pure form of EW counting and, sometimes, opt instead for KISS counts ... if it LOOKS like a Wave 3 rally get on board the train and bugger the purity of the count.

All those overlapping waves are what convince SOME of the purists (certainly not a practical fella like Rudy) that the sky is falling and they're constantly wondering why their Shorts are gored by the Bull rush.

EW is a great topic and a FANTASTIC methodology. But, it ain't a Holy Grail and sometimes yuh just gotta go with your gut and your brain.

Ciao - RA


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rash
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Friday, November 26, 2010 - 01:27 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



A further word ... because Auntie is boring me to tears!

Hal ... et al: I wouldn't for a moment discourage anyone from learning and trying to apply EW methodology in its pure, academic form.

Rudy was incredibly patient and instructive as I began studying it. And, frankly, I regard having learned the basics as the single most constructive and important lesson in my many years of stock market studies.

And I'm a firm believer in the concept that one always has to learn enough to know what one does NOT need to know.

Luckily, Rudy is generous enough to put out an always thoughtful and intelligent Market Wrap which usually puts both sides of a particular case and always gives a weighting to the most likely outcome, given all the prevailing conditions.

I leave the in-depth probing of the intraday moves to him and just use the bigger-picture wave position to help inform my other techniques.

But I really would recommend perseverance with the initial studies to get a firm grasp of the formal rules and guidelines ... because they can save you an awful lot of angst, not to mention actual losses.

One can have a view about what the count is up to a certain point and what is most likely to come next. The beauty of knowing the rules is ... when you're wrong, you're WRONG and you know to get out of the trade real fast!


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ehmu
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Friday, November 26, 2010 - 01:30 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Thanks Rudy, for the counts and the extensive descriptions. The symbology that you put on helps to see the different levels of wave structure.

Faster than a speeding bullet was the response, you're quick.

I do see your argument for those first three legs up being corrective, but not sure how that will help me take my next position, other than getting short in a big way once the next peak is in ie C. see C ci ci.

In response to Randalls comments, I was one of those people that missed out on that first rally. 200 points, while I was being attentive to those doom sayers, still focussed on the carnage in my rear view mirror. Had I just taken a position and moved the stop as price advanced past the pullbacks, well you do the arithmetic.

All I can say is that I may have been suffering from post traumatic stress disorder from the slide in to that bottom.

thanks again
H




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rdumas
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Friday, November 26, 2010 - 03:39 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Hal,

Been busy today so only just got back to the computer ready to update some of charts that I have to do manually. Just a quick word.

In answer to your comment: "I do see your argument for those first three legs up being corrective, but not sure how that will help me take my next position, other than getting short in a big way once the next peak is in ie C. see C ci ci."

It's okay to do the long term stuff to get the feel for what may be ahead in the months/years ahead but most of us are shorter term traders than that. As many have said on this thread in the past, depending on your investment time frame, trade one trend at a time. There are many impulse waves and corrective waves in every pattern that will develop in the future and many have similar patterns early in the piece. So when all of your scenarios point in the same direction then go with what they are saying. Don't worry too much about what may happen months from now.......we may not be alive to see it happen.

I must emphasise however that I personally use EW as just one of the tools available for making trading decisions. I do not use it exclusively for coming to a conclusion about a trade, in fact sometimes I don't use it at all.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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billt
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Friday, November 26, 2010 - 03:48 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Guys

Hal’s question had me off looking at the ‘Bigger Picture’….I also waited for Rudy & Randall to add their wisdom before my ‘Primary School’ thoughts…

I assume your question Hal is based on the consideration of whether we can have a significant pullback without invalidating the bullish scenario...I assume by 'bullish' you mean the 5 wave north to an early 2011 high?

A bit of background - but you may already know this:

Using the Dow as a reference chart, Rudy & the 4Gs have the October 07 high as SC 3. As Rudy has explained, he feels the impulsive move down from the October 07 high, followed by the corrective run back up from the March 09 low, and has all the hallmarks of a larger ABC correction south to complete SC 4. Currently we are in a 5/3/5 Wave B having completed 5/3/3 and just about to complete wave 4.

Caldaro & Pug see the October 07 high as the completion of SC 1, and the March 09 low as the completion of SC 2. They are now in Nirvana EW Heaven as for the rest of their lives they may be in SC 3….

The Prechter Type Count has us in a 5 wave count down from the October 2007 high.

Rudy’s and Prechter’s Counts deliver a similar medium term outcome, however Prechter’s ends up considerably lower.

I see the logic of Caldaro/Pug count. SC2 completed near the level of wave 4 of SC1. At the 20 year chart level, the push from the March 09 low looks impulsive enough….(but as Rudy suggests drilling down to daily charts shows the more ‘corrective’ beginnings….) From a 'fundamental' point of view I have no idea how the Western Economies can simply continue to thrive with masses of unsolved economic problems, and at that point my hope of Caldaro's Bullish Count fades....


So back to your question Hal:



“…is it possible that your wave iii is a part of a wave 1 extension. If it is, I was thinking that it could retrace to around the most recent C (March 09 low?) level at some point in time and not invalidate the bullish scenario.”



The 4Gs view is that we will have an early 2011 high, taken from Andrew’s Cycle Analysis work (ages ago!), and therefore they see that we will continue to run out the wave 5 until then. We then will revisit lower levels towards the March 09 levels in a Wave C….

Prechter has a similar medium term outcome; however he heads a lot, lot lower.

The Caldaro/Pug count has us in a SC3 count, so modest corrections in a multi year bull cycle. Their count remains valid until Wave 2 takes out the March 09 low.


“is it possible that your wave iii is a part of a wave 1 extension”:

It is highly unlikely Hal. Wave 1 commenced on 2 July 2010, and ended on 9 August with a decisive Wave 2 correction of >61.8% of Wave 1. You cannot dismiss such a major correction - Hal, you would be put in the 'naughty corner' with the Canadian Wildlife.

Rudy’s Count takes us down to lower levels commencing next year – but at some point SC 5 will take us back north. Hopefully we will still all have a pulse by then....

Caldaro/Pug’s count could take a quick trip to Deep South, assuming a re-labeling of the top of wave 1, before a journey to Nirvana. If it did, it would have a similar outcome perhaps to Rudy’s Count no doubt.


The Blue Count is Rudy's EW Count. The Black Count Caldaro.











Caldaro's Count is in gold - his labelling allows for a considerable time period for SC3, so we are in the infancy of the wave order. Rudy's is in Red & Black.

Wave ii was too significant a pull back not to include it within the 5 wave count:






The only way we can head back to the July 2010 lows (if that was what you meant) in the short term before heading to Andrew's early 2011 highs, is on the basis that Wave (B) on Rudy's Count has not yet completed. (On Caldaro's Count it would mean that gold wave i would have completed on the November 2010 high)

The problem with this is that Andrew's Cycle Analysis shows that if that was to occur we need to be crunching down to that level by the next few days as his work suggests an interim low by the end of November - so unless the USS George Washington takes out North Korea over the weekend & Comrade Kim Il Sung takes out the South, I doubt we have the time nor the reason to drop 20% so quickly.

The Count would turn into an abc off the July 2010 low, another abc off the November high, and more than likely a 5 wave impulsive move commencing at Xmas with Santa and his Raindeer (Elk)....but for all that to happen perhaps you have to believe in Santa!

I have been bothering Rudy for months on this idea, as I still do believe in the Big Bearded One! ....

Comrade Kim Il Sung of the 'Down-with-Imperialism Union' (DIU) may be my final hope.....






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rdumas
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Friday, November 26, 2010 - 04:06 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Bill,

A good summary mate but just a slight correction to your comment "Using the Dow as a reference chart, Rudy & the 4Gs have the October 07 high as SC 3. As Rudy has explained, he feels the impulsive move down from the October 07 high, followed by the corrective run back up from the March 09 low, and has all the hallmarks of a larger ABC correction south to complete SC 4. Currently we are in a 5/3/5 Wave B having completed 5/3/3 and just about to complete wave 4."

I in fact don't believe that the move down from the October 07 high is impulsive which is why I left Hal's ABC labelling in tact. I believe that it is corrective which is why it leaves open the possibility that SC4 could still be either a Flat or a Triangle rather than a Zigzag. Note that in a Flat pattern the wave B of the pattern recovers at least 70% of the wave A move. Remember that the SPX has already recovered around 62% of its 2007/2009 drop.

The importance of that statement is that it is entirely possible that the March 2009 could possibly be the low for the GFC. In fact the further up the March 2009 rally extends, the greater the chance that this will be the case.

Note however that of the three Flat patterns available it is possible for the third wave of the Flat to extend below the termination level of wave A.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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billt
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Friday, November 26, 2010 - 04:20 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Crossed in the post there Hal,

The good news is that all EW counts are suggesting a rally north once we put in this current low (if it isn't already in)....fill ya' boots with TNA & TYH and ride wave 5.

Interestingly TNA has already rebounded to the previous Wave 3 high, it is already in a possible wave iii of 5! It could be putting in a larger wave b of an abc wave 4 pattern, but it often heads off before everything does, so I'm watching it closely.

cheers
bill


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billt
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Friday, November 26, 2010 - 04:30 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



...and crossed again Rudy,

Quite right there mate - I don't know why I said it was impulsive? The move was a 5/3/5 abc corrective, the same count as Caldaro as it happens....


'SC4 could still be either a Flat or a Triangle rather than a Zigzag' - so it leaves lots of options open there...


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ehmu
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Saturday, November 27, 2010 - 04:56 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)




billt wrote on Friday, November 26, 2010 - 04:48 pm:

It is highly unlikely Hal. Wave 1 commenced on 2 July 2010, and ended on 9 August with a decisive Wave 2 correction of >61.8% of Wave 1. You cannot dismiss such a major correction - Hal, you would be put in the 'naughty corner' with the Canadian Wildlife.




lololol

As you may have guessed Bill, I'm no stranger to the 'naughty corner'. I do prefer Elk to sheep tho, they're quite a bit taller, and not so cuddly.

I have to express my gratitude again for being included in discussions from the inner sanctum. I'm writing my letter to santa now, asking for him to fill my stocking with acumen (that's not a spice btw) , so that I can understand a little more of the wisdom that is available to me here.
http://vocabulary-vocabulary.com/dictionary/acumen.php

Referring to Rudy's "proposed SPX count" his post 4363. What I was asking was if we could be working on an extension to his (A). If this is the case then (B) would not have been put in yet and (A) would not have been completed yet. This would not however allow for (C) to be in May or June (and I would need to abandon my deeper pullback scenario in between). [if you were to put my 1 where his (A) is, you will understand better what I was thinking]

What is coming through from all of you is that I was lost in time, when I went to the longer time frames I lost sight of the next peak.

I'm attaching a chart that shows my idea of what Rudy sees unfolding between now and june-ish. I'm presuming that A and C would be of equal lengths. If this were all to be true, we are looking down the throat of another 25% rally.


ps
in the future I promise to only initiate conversation in the sub-minuette realm, where men are men, and sheep are scared.






_____ n a m a s t e

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ehmu
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Saturday, November 27, 2010 - 06:50 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Looking like a rectangle on 60min.

Entered from the top last, could break down.

Entered from the bottom prior to descending triangle, could break out north.

Statistically they say that most rectangles break to the upside.

Either way, first target about 20 points from bo.

http://www.forexhit.com/learn-forex/price-patterns.html






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skyhawk
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Saturday, November 27, 2010 - 07:04 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hello Bill,

In actual fact I have two potential cycle points for a peak. The
one I favour is Feb 2011. The alternate is June 2011.

I will have a better understanding which of these will be
most likely to play as we approach Feb next year based on
the 4 year cycle profile. ATM favoring Feb though based on Delta Cycles
and EW


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billt
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Saturday, November 27, 2010 - 07:39 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Thanks Andrew, sorry about that - I should have included your June date as well. The Feb' target date looks the more appealing due to the EW count, so I have that fixed in my mind more strongly.

Hal, you will have to let us know where you are in the planet - I thought you were a Canadian Convict living in 'Oz, but obviously not....

Interesting to note that Pug now has his primary abc count heading further south based upon the VIX bullish - (he may be spying on us too!) If (c)=(a) then 1144 might be on the cards, the 38% minor wave 3 retrace is at 1156, and the martians are at 1136. Pollyanna needs to get going....


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ehmu
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Saturday, November 27, 2010 - 10:39 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)




billt wrote on Saturday, November 27, 2010 - 08:39 am:

If (c)=(a) then 1144 might be on the cards, the 38% minor wave 3 retrace is at 1156, and the martians are at 1136. Pollyanna needs to get going....




Pollyanna is a little on the sleezy side, so she may visit them all quickly--- flash the martians, visit (a)/(c), and rest on the .38.

Bill, I've been naughty, but not a convict. I have multiple citizenship so it's all very legal where ever I manage to find an internet connection.




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ehmu
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Saturday, November 27, 2010 - 02:34 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi y'all:

I'm studying from the masterworks, trying to make sense of alternation and guess what jumps off the page at me.

You check it out, maybe I'm experiencing some kind of southern hemisphere delusion.











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skyhawk
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Saturday, November 27, 2010 - 04:00 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hello ehmu,

Yes that would be one possibility. There ARE others though too.I can think of at least another two possible counts.
Ultimately what you would like to have is all your counts suggesting the same direction, at least in the medium to long term.
Yours is a bearish one, others that I can think of are bullish. So at present I see more bullish counts than bearish ones. That does not mean I am right.

What needs to happen now is to quantify which count is the highest probability scenario

Cheers


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ehmu
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Sunday, November 28, 2010 - 06:54 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)




skyhawk wrote on Saturday, November 27, 2010 - 05:00 pm:

Yes that would be one possibility. There ARE others though too.




Thanks Sky Hawk:

I'm getting a little ahead of myself I know with my "seeing eye EW", but can't curb my enthusiasm quite yet.

Besides that I'm holding a couple of bearish positions, and would like to cast a spell on the markets (this is meant to be humor, in case anyone feels a lecture coming on).

Here is one extension of the "Wave C""camp. It would appear to be a good choice since it would inflict maximum suffering on both the bulls and the bears, actually going sideways until February. In other words, it doesn't close the door on the bullish scenario. Actually, in February, we could still flip a coin for which way the markets might be going.

ps
PayPal today announced Black Friday shopping results, showing a rise in online and mobile sales on what is traditionally the biggest shopping day for brick and mortar stores. The company reported approximately a 27 percent increase in total payment volume on Black Friday 2010, compared to the previous year.




(Message edited by ehmu on November 28, 2010)




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rdumas
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Sunday, November 28, 2010 - 08:41 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Hi Hal,

Absolutely nothing wrong with being enthusiastic. It pays to keep all scenarios on the table and one by one they will be invalidated leaving you with (hopefully) the correct pattern.

In the meantime use every tool in your tool box in an attempt to come up with the most accurate scenarios possible.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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rdumas
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Sunday, November 28, 2010 - 02:30 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Interesting Statistics

The following statistics were taken from the following link:

http://www.safehaven.com/article/19120/technical-market-report-for-november-27-2 010

"Since 1928 the SPX has been up 74% of the time in December with an average gain of 1.4%. During the 2nd year of the Presidential Cycle the SPX has been up 75% of the time with an average gain of 1.6% making it the 2nd strongest month during the 2nd year of the Presidential Cycle. The best ever December for the SPX was 2008 (+10.7%) the worst 1931 (-13.4%)."

Obviously we are talking about statistics and just because the SPX goes up 75% of the time during December of the 2nd year of a Presidential Cycle doesn't mean that this one will fit into that 75% category. It could just as easily be in the negative 25% category but it's nice to know that the stats are on your side especially when you are suggesting that the market should start going up in the near future.


I've given you my view based on what I know now. In another 5 minutes that view might change because of additional information. It's the best I can do - Rudy

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skyhawk
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Sunday, November 28, 2010 - 04:23 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



I have just been looking at the following markets and Elliott Wave Analysis looks crystal clear at present.

I have talked about the AUDUSD in earlier posts and how well it has been correlating with the SP500. Looking at the file below we have a target range of 0.9469 to 0.9495. The 0.382 Fibonacci retrenchment of red wave 3 is:0.9469. This is a common target for a 4th wave and in this case we are expecting a complex wave 4. Equality between pink waves a and c is at 0.9495 and as such we have establish a good target range. Really textbook EW stuff..
The next tab in the AUDUSD Analysis file shows my Trading Bands showing a similar zone of support between the 3rd and 4std deviations away from the nominal blue line (0.94-0.95).
Lastly I have included the Super Long Term Fixed Cycles Analysis. These have been bang on for forecasting the long term trends. The cycle point we are looking for is cycle point red 5. The last time this cycle point occurred was back in 1980 (A Metonic cycle ago). Back then it came in 33 bars past the red vertical line. At present we are 30-31 bars past the red vertical line that was in 2008. This is telling us we approaching a very important top next year.
So we have great confluence here, and the probability is high that this will be the last leg up for the Aussie buck.

Looking at the next file SP500 Analysis, this too is showing crystal clear EW patterns. In the first tab I have
annotated the EW count for the 8hr bars. As can be seen, red wave 2 was sharp, as such red wave 4 will most likely be complex. (Law of Alternation) The 0.382 Fibonacci retrenchment of red wave 3 is 1155-1156. That is our most likely target and could be the low for the first leg of red wave 4 as I have mentioned on previous posts. This level of 1156 also has confluence with Barry's Fibonacci work and is also obtained wave equality, depending offcourse where pink wave e of the triangle finishes. As such it is high probability. Moving along to the next tab in this file the SP500 Fixed Cycle analysis ITD chart. This shows delta point blue 11 due between 3rd Dec and 10th Dec. I think 3rd Dec is higher probability as seen by the MTD chart in the next tab.

Lastly, I am looking at the All Ordinaries (XAO).
In the first tab, I talk about the fact that the wave structure of the legs since the July low have broken as 3 wave structures and not 5's. This makes counting these challenging and SUGGESTS that this pattern is distributive. Especially if red wave 4 overlaps the top of wave 1. That DOES NOT mean the impulse wave count would be violated and we have no wave 5 as some have suggested...
Rather that wave 5 will also be a 3 wave structure and the pattern could be a skewed Ending Diagonal or a variant to the conventional looking Ending Diagonal. As such this pattern needs to be quantified.
Moving to the next tab I have drawn a weekly line chart of closing prices. As can be seen wave 3 now breaks into a 5 wave structure compared to the OHLC Daily chart 3 wave structure. The weekly chart has filtered the pattern for us and quantified the wave count. As such it is high probability we will see another leg up here.
The next tab shows the Fixed Cycle Analysis for the ITD Cycle timeframe. Clearly one can see that blue cycle point 1 comes in smack bang in the middle of red vertical line and red blue line as shown by the red arrow. It has done this since this time last year. The following tab, the fixed cycle analysis MTD timeframe shows the that cycle point red 1 as shown by grey line comes in about 7-8 bars past the red vertical line. At present we are about 4 bars past that red line.

Some other interesting Fibonacci time counts in the following tabs. Firstly, 3rd-4th Dec will be 233 Fibonacci calendar days from the 15th April high. Also, we have a big
Fibonacci traded day cluster on the 10th Dec. This date is very important as Barry has also noted it in his Fibonacci time work. At this stage I am not sure if 10th Dec will represent a high or a low, so keeping these fibs in line with the Fixed Term Cycle work I will keep 3rd-4th Dec as the prime candidates for a low. Ultimately though it will the pattern that dictates which will be correct as we approach the end of next week.


Cheers
application/vnd.ms-excel
audusd analysis.xls (247.8 k)
application/vnd.ms-excel
sp500 analysis.xls (193.5 k)
application/vnd.ms-excel
xao_ew analysis.xls (456.7 k)



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billt
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Sunday, November 28, 2010 - 05:50 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Thanks Andrew for your detailed input this week - I was hoping that you had time to complete such an exercise.

Could I ask that you repost the SPX MTD chart, as I can only find two SPX ITD charts in your attachments...thanks.

It is all extremely helpful.

I assume Andrew that according to your analysis, that the February 2011 or June 2011 potential top will post a new multi month 12 month high - and not an interim high as Hal has suggested within his post 144?





Hal, whilst writing....you will notice that Andrew's Cycle work has remained very convincing throughout these past months of 'head scratching'. Although Rudy's, Randall's and Barry's work add to the important mix of the 4Gs, Andrew's Cycle work pointed to a potential 2011 high long ago when many EW practitioners and many other leading economists were forecasting an imminent market collapse. What I try to do is to look at other less likely EW patterns that fit within Andrew's Cycle Count, and discount them when they run out of time. Your Count in your post 144 is an interesting possibility but I am uncertain whether it fits into Andrew's logic?


cheers guys

Bill


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skyhawk
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Sunday, November 28, 2010 - 06:03 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Thanks Bill,

I saw that error with the SP500 MTD. I tried to delete the post and rectify, but the site would not let me.
Here is the corrected file.
I should think that a new high should be reached in the SPX as suggested by cycles.. But there are no guarantees

Cheers


application/vnd.ms-excel
sp500 analysis.xls (299.0 k)



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billt
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Sunday, November 28, 2010 - 06:43 pm:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



thanks Andrew - appreciated

bill


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ehmu
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Monday, November 29, 2010 - 03:15 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Thanks Bill for the feedback, and using your staff to gently lead me back to the fold, appreciate it.

I have been getting up to speed with Randalls cycle analysis and look forward to the correllation clicking in for me.










_____ n a m a s t e

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ehmu
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Monday, November 29, 2010 - 03:36 am:Edit Post Delete Post Print Post    View Post/Check IP (Moderator/Admin only) Ban Poster IP (Moderator/Admin only) Move Post (Moderator/Admin Only)



Randall, thank you for all of the updates.

I focussed in addition on how the Canadian dollar relates to yours. I was presuming all of this time that they would have similar patterns. Mainly because our economies have a similar base in resource stocks. China is also quite involved in the Capital markets in Canada.

I couldn't have been more wrong, see attached chart comparing your dollar to ours, with the thin overlay line your dollar vs USD.

The AUD/CAD chart looks almost identical to that of the AUD/USD, except the corrections are not quite as pronounced.

Gangbusters AUD






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