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Wednesday, June 17, 2009

Elliott Wave Update ~ 17 June


Taking 956 as a peak (time will tell if its P2 peak or not), I can count a pretty decent 5 wave move off the peak. You can see a clear channel that the SPX is still obeying. If the market cannot break out of this channel tomorrow, then the move down is still advancing and I will likely re-label where I currently have wave [v] as a wave [iii] low. If that's the case, wave [v] target would be around 898 - 900 or just below today's low.
The ending wedge-looking move should signal the end of a wave [v] though. So that's another clue that I have the short term labels correct.

So watch how the upper channel on the chart behaves.

28 comments:

  1. To Dan From Max Cherry, something just doesn't look right with the 5 wave down what do you think of this


    http://stockcharts.com/h-sc/ui?s=$SPX&p=5&yr=0&mn=0&dy=7&id=p91220403938&a=170665840&listNum=12

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  2. Its possible Max. I was thinking double zigzag also as I mentioned in last night's update.

    But sometimes when a wave 3 does not extend 1.618 (my wave [iii] was only a 1.3 expansion), wave [v] likes to make up the difference.

    For instance if my wave [iii] had extended 1.618, its low would be at 913. A wave 4 retrace back up 38% would take it to 925 and then a wave [v] = wave [i] would take the wave [v] low to 904 SPX.

    So since wave [iii] lacked a bigger expansion, I always assume wave [v] will try and make up for it somehow. And in this case it did. Wave [v] low was 903.18 virtually the same as my 'perfect' wave example I just provided.

    Its a little theory of mine for impulses. Sometimes it pans out.

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  3. PS - Also wave [v] connected neatly with wave [i] and [iii] low which is also why I am going with a 5 wave move. I really don't have a choice here at this stage.

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  4. To Dan From Max
    Your count does fit with the seasonal pattern for June I'm looking for support at 880 then see what happens I just don't like that first "i" down
    http://www.dogsofthedow.com/moncyc-jun.htm

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  5. Dan, looks like a textbook five count to me. In fact that's pretty much how I expected it it to pan out today. I didn't cover any of my 2x/3x shorts--this due to account churn and recycle time--not because I didn't think we would get an ABC correction. This is pretty much what I expected yesterday going into the close. I spent only a few seconds looking at your chart before saying "yup". Just the count I had in mind. Of course that doesn't mean squat. Two people can agree and be wrong but I don't think this is a terribly difficult count to call. Max, I took a look at your count too. No, that doesn't work for me. Not sure what you find disagreeable in the five count but it's always good to have another set of eyes. Peace.

    In parting, I think we put in the C wave on Thu and head down late Thu or first thing Fri morning. One thing I don't need to tell you all is...if this is in fact P[3]--not convinced of that yet, but IF it is--then Monday morning is going to be a blood-spattered, "Whoa daddy!" scene out of Fargo.

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  6. quick reminder to those waiting for a 1 or 2 day upward correction before going short - often in hard downtrends (which we appear to be starting) the market will not wait for you. be careful for much more rapid movement than you expect (like wave mins being enough instead of wave fib norms). i'm still waiting for the bounce myself but would not be surprised if the move down gets expedited with so many waiting for it

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  7. I agree with JohnnyBlue. But confirm with the chart. Pull up a 30m and look at June 2nd to date. See how the market goes chug, chug, chug up the hill, then BAMN! straight down, wiping out all the gains? it did this multiple times. So? So, it's indicative of wave personality. And you can see that personality manifested even in the hypothesized 'B' wave from today.

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  8. Hi Dan,

    Thanks for this chart and comment. Your channel helps clarify the choices here.

    (Any chance the correction ended at today's low of 903 and we slowly mend our way back to 950+?)

    Anyway, if the decline continues within the channel, and [v] eventually gets changed into [iii], wouldn't the eventual [v] end on the lower line of the channel well below the revised [iii] (today's low of 903), and well below your possibly-to-be-revised [v] target of 898-900? It seems that a revised [v] would end around 875-880. What do you think? Thanks.

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  9. Any change today spx close below 934.35
    Below 935 I expect [880,893] very short term.
    Below 957 I expect [790,820] medium term.
    If spx close hourly above 928 I have to reduce some short.
    Can see table of traders at the end of the blog.
    Click to zoom in.
    Enjoy.
    Read more... http://followmarketrend.blogspot.com/

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  10. To GBT From Max Cherry, Don't get me wrong "see" the 5 down but i've been burned before by the prefect count, I'm playing it as 5 down and am looking for "C" but as JohnnyBlue said the market might not wait. We might have another missing wave as overnight futures complete the "C" and thurs morning starts another down

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  11. How about a three wave pattern down to 777. Yep, thats right 777 which is the .618 retrace of the last wave up beginning at 666. That's right, 666..

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  12. mbewtrader, there's lot's of speculation among ewavers and TArs right now about putting in a right hand shoulder for an large IHS. A scenario that definitely holds water IMHO--the P[3] crowd would certainly disagree while the P[1] crowd would embrace the idea. There was a very nice chart presentation from Break Point Trader on this very topic last night. You should check it out.

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  13. nice work dan! I hope the market is telling us something here for a change!

    some ideas of the 1 minute chart action... http://natesmarketanalysis.blogspot.com/

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  14. SRS I would only be expecting a wave [v] = wave [i] situation if wave [iii] was so extended. wave [i] was only 21 points. So channel midpoint for [v] if [iii] gets extended

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  15. Nate that looks nice. I added you to my blogroll, thats real nice work

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  16. This comment has been removed by the author.

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  17. Good stuff Nate. But as I'm sure I don't need to tell you, W4 crossing W1 on some indices is tsk tsk tsk. No sir, I don't like it at all. That's always a big red flag for the count. But I'm very glad you pointed that out.

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  18. Wedges are "quickly retraced". Since wave five here took one day to form, the move back to 928 should be underway right from the get go. The USD is one of the keys to this market IMHO. Any analysis from you would be appreciated. Thanks again DE!!

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  19. PS...the nasdaq comp also clearly wedged at todays lows.

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  20. Dan, I don't know if you appreciate and/or tolerate links to other sites. If you don't just tell me and I won't do it again. But I think Roy's analysis is quite good. I view his blog daily along with yours:

    http://www.youtube.com/watch?v=W2w8zE-WP0s

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  21. 5 waves down??....Not! lol............A-B-C-X-A-B-C down and now we are ready for the next advance to new highs..
    tbrown

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  22. Wow. Lotta hubris there tr_brown. If you are right then you are due for some major kudos and hat tips. We'll see.

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  23. Surprise big up day today! Was expecting a pull back today below 900.

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  24. tr_brown, are we really ready for the major advance new high? I was expecting SPX to pull back and test less than 900, but end up seeing the market goes up big today. Tomorrow shall be interesting.

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  25. GBT and Mandy:
    No, no new highs, not quite yet anyway...:-)
    You see, Dan, whose work I admire greatly, seemed a bit tentative in his count the last couple of days and I just put that comment up as a friendly poke at him. I thought the comment was so obviously outrageous that no one would take it seriously, and I'm sure neither of you really did.
    I trade the S&P futures contract, and I'm looking at 870 as probable support basis the September contract. After that, we may actually get new highs later this summer though. I have outstanding upside targets at 1026 and 1102 on the futures. Good trading all....
    tbrown

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