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Wednesday, April 22, 2009

2-4 Backtest?


The market looked like it was "bumping" into some invisible line at the peak tops today. I think this constituted a "2-4 line" backtest. It certainly failed for now.
Remember I was saying that P2 may eventually backtest Primary wave 1's 2-4 line? Well this is sort of the same thing. A near term top sets in at 875 and the market falls down. It then backtests the previous 5 wave structure channel lines, or, what we call the 2-4 line. Today looked like a test of that.

16 comments:

  1. A perfect diamond.

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  2. The ES tested it earlier in the day. Maybe we watch that first in these cases for future ref.

    Nice work Danno - Book 'em.

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  3. Oh- OK target man - do your thing mapping out this 5 wave move down. (Should call you Mr. 875 from now on - till you nail the next one of course)

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  4. Also look at that right shoulder formation!
    Good Work Dan!

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  5. So, where is the next support and resistance levels? Please explain to us non-EW'ers.

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  6. To Dan From Max Cherry,
    I hope this count is wrong, any thoughts?


    http://stockcharts.com/h-sc/ui?s=$SPX&p=30&yr=0&mn=1&dy=0&id=p45706706313&a=164118891&listNum=12

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  7. Max, yeah I thought of an Expanded flat as you chart. That would definately be upside surprise from here because that implies a wave 3.

    But I think market momo is waning

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  8. Dan From Max Cherry
    I agree with the momo, also I think the rule of alternation rules out consecutive expanding flats as you show one in late March already. I'm betting the move continues further south at least close gap at 825. That should kill the count

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  9. Dan, I'm tracking cycles right now on the 60m trying to anticipate 21 cycles (I think 13 is too short) for P2. if we talk cycles in the scope of (X) or (B) (depending on your count), how many cycles do you see for this pullback? i'm reading almost 2 already after the top at 875 and would suspect maybe 5 (nice fibo) to complete the corrective. thoughts?

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  10. Actually on 2nd thought maybe one last cycle down and that's it. 9 for the ride up

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  11. I have should it spot earlier these Backtests are nearly 100% reliable.

    do you see a simple abc down (now in c) and which wave is this? 4 of A or do you think X-Wave or eben B-Wave?

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  12. One wave at a time eben but check Kenny's post tonight he explains it all exactly as I would have

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  13. Also note how it broke 200MA that it has been holding all this time! Tomorrow SPX has to rebound above 200MA ASAP to have any chance of avoiding the pullback.

    As alway fantastic analysis, thanks :)

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  14. Dan, it's sure looking like it wants to go back and test 875 again. Fridays famous for short covering. I'm wondering if we get a double 875 test before a correction. Like the 37/38 charts.

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  15. Dan, bullish dragon doji for FAZ today confirmed a new trend. All in after hour today. I hope it will filled the gap at 18.

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