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Thursday, June 4, 2009

Elliott Wave Update ~ 4 June

The market seems to be following my count almost perfectly last couple of days. I called the 949 top the A wave top. The retrace back to 923 as a B wave and now the market has traced a leading diagonal in the wave [i] position of the final C wave up leg which should be 5 Minute-sized waves in all to P2 peak. The next set of logical moves is a dip down to 934 support and then a power move over 950 in the meat of a Minute wave [iii]. Maybe they gap it high over Monday.....

The SPX is working itself into position perfectly for a power Minute wave [iii] move over 950.

The 950 level represents a key pyschological resistance area for a LOT of traders, media etc. I happen to think a break over 950 will produce the "euphoria" and good new stories that will flood the media once this happens. It will indicate the top is near and everyone in the media should be on the bull bandwagon. I think 9000 Dow is the real target and will be hit.

The alternate is my chart here:

The alternate is a bearish move down to 914 support and a hard, hard rebound after that.

However I *think* this P2 wave should end in grand fashion pyschologically. A decisive move over 950 should do the trick and be one last hard squeeze of the shorts. Call it a gut feeling.

I think retail is powering this final leg. Just a hunch (from offhand 401K conversations I hear lately at work)


  1. I hear those same 401K conversations from people who don't really follow the market and have no idea what's going on. Do you try to warn them?

  2. I just unloaded all longs from my 401K accounts.
    And get ready for P3

  3. Yeah I tell them the market has rallied like 40% and they may be buying the top.

  4. Dan, I think you should adjust your chart a bit. and label the WAVE 1234 just like Kenny's

  5. Government Sucks (GS) was pumping oil and commodities today. I guess that means we head higher.

    Watch out for the fadable NFP tomorrow.

  6. hehehhheh just guessing here. nothing too serious heheheh

    Me thinks Boyz want to try break 200 week moving average on parabolic move or at least get as close as possible +30%.

    I think they can do another at least another +15% from here on a parabolic run before exhaustion. The psychological number is DOW 10,000.

    Extricated self from leveraged ETFs. Might reenter in the higher exhaustion only if the boyz start shorting each other again to reduce the competition left, otherwise playing remainder of wave 2 and 3 in critical commodities as they start printing money faster.

    Good charts Daneric!

  7. To Dan From Max Cherry,
    Dan, I have to disagree with your long term count, in your primary 1 down you have the low for 3 at 839.80 on 10/10/08 price and time ratios point to 11/21/08 740.66 as the wave 3 low wave. 1 was 319.11 x 1.618 = 516.32 wave 1 low of 1256.98 - 516.32 = 740.66, wave 1 was also 108 trading days 108 x 1.618 = 175 10/08/08 low of 740.66 is 175 days from wave 1 low. And 108 x 3.236 = 349.48 the wave 5 is 353 days from the 10/11/07 high. Not that it makes any difference in the structure but the point I'm trying to make is price and time ratios play an important part in Elliot wave analysis and I think it's to early for a P-3. We are only 60+ days off the low and 1000 would be barely 38% retractment.

  8. Max, if the market hits 999, thats an exact 50% rally.

    I don't think its too early at all. I think everyone is mesmerized.
    Bears will turn bullish above 950

    Then the jig will be up.

  9. what are the odds of your alternative scenario from previous thread "Alternate Scenario"
    thanks. great charts dan

  10. Dan,
    I'm right with you on your bullish count.. my target for $spx around 1019

  11. Dan, I think you should adjust your chart a bit. and label the WAVE 1234 just like Kenny's<<

    Yeah Dan sounds like good advice. LOL

    Actually, I would prefer you leave it as you do so people can have both. My old one is kind of buried.

  12. actually Kenny is correct we will be finishing wave 3 and prob correct to atound 910 to start last wave 5

  13. by the way Kennt there is a problem connecting to your blog

  14. I went to a trader's expo in LA today and one guy I talked to wanted to trade options on the USO and was interested in currency ETFS, particularly leveraged ones. One of the speakers, Larry McMillan said the market was tracking the 1938 bear rally and that it was right now in the early stage of the breakout from the retest of the '38 low in the spring. His own 21day weighted put-call ratios were at 2year lows but he doesn't time the market based on them.
    The conference seemed to be well-attended and one speaker commented that the economy didn't seem to have affected the turnout but maybe it was the social/ market euphoria that drove the turnout instead?

  15. Dan, you are ficking genius