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Thursday, July 16, 2009

Elliott Wave Update ~ 16 July

I think I have a decent read on the subwaves. Regardless the up momentum is waning and there is subwave 4 action going on with the early sideways movement. At what degree is still open to debate. However I think once the tight channel up breaks then the Minuette (pink) and lower waves indicate they are finished.

So a battle may ensure in a Minute subwave green [iv] for OPEX Friday between near term support of 930 and the 950 resistance band. Could be very choppy.


  1. Dan, first congrats. on all the posts, and second, getting it right (the other guy T.C. seems to be on the other side of the trade)i've been kicking this count around and what to know what you think, i'm not sure the "E" is valid everything hit new lows the 13th and the action looks like it broke from a wedge especially if you look at the S&P futures.$SPX&p=5&yr=0&mn=0&dy=10&id=p46120428783&a=171595145&listNum=12

  2. Max I don't think a triangle can occur at a low like that. I think there may be better ways of tracking that low area.

  3. Dan - You think we can pull back to 900 before racing off to new P2 high for the summer?

  4. I don't know Darth. 900 would be a backtest of the H&S neckline so its possible.

  5. Dan, thanks for all of the great work. I'm very new to EW theory, and have been following you and K pretty closely lately. Can you give a brief distinction between your primary count and K's latest, plus the near-term implications for the S&P of both?

  6. I am in the "P" camp as now Kenny calls it. This is Primray wave 2 up out of 5 Primary waves down.

    P2, as we like to call it, should top out after another ABC up to form a tripel zigzag off the 666 low.

    Kenny has pretty much swicthed over to the ABC camp. He doesn;t think the market can go down to DOW under 1000 so he sees 666 being taken out but not as sever as I do. I also call for a 5th Primary wave down, and he won't.

  7. You're the man! I agree with the choppy 4th wave. Ichimoku charts show a squeeze between the clouds.

  8. Dan, I just came across this from Elliot wave theory, it seems triangles do occur at bottoms of corrective patterns (great another wave pattern to worry about) i dont know, seems to fit to me.

    Rules and guidelines

    All types of corrective patterns can combine to form a bigger corrective pattern.
    The rules and guidelines, as mentioned for other corrective patterns apply.
    A triangle in a Combination should normally occur at the end.
    Corrective patterns in a Combination normally show alternation

  9. Look good on the squigs. same thing I was calling today. I also expect some consolidation here. Where we differ is that afterwards on wave 5 I see a false breakout to end the rally

  10. Could be Kenny. But the 10-1 and followup 28-1 up days seem to signal the last phase of advance is underway.

    You really think that so soon after those bulls days they give it all up?

    I mean its not like the market bounced from an extreme spot like the 666 low or the Oct 2008 plunge to 839.

  11. yes I do. the real MAIN channel line lines up with C being 1.62 of A next week. Shorts are gone and there is too much bullishness. There is a major rotation coming once the dollar completes the thrust. This is how it works. anyway, there is really no major difference to what you say and I say. just a matter of a B and a C. targets are close.

  12. and say it is a Zigzag bear market. a double ZZ could look just like the P setup

  13. "I mean its not like the market bounced from an extreme spot like the 666 low or the Oct 2008 plunge to 839."

    Dan, to me this is exactly why the market will run out of juice fast. We should've been doing a final p2 leg up from an extreme low in bullishness and breadth i.e. where a corrective should've ended (like 50% retrace). Look at the BPNYA - we are starting this leg up from an already major bullish point, very much unlike the aforementioned extremes. She will run out of steam fast if not already. Zweig value (breadth) confirms this for me too - it is topping out

  14. and there was a lot of short covering in those big breadth days. it is not the same as at a bottom where more buying would follow through

  15. Wow, what a great site. I really appreciate the charts and analysis.

    As we all know, P2 is supposed to rekindle some of the enthusiasm of the previous high before it's over. So sentiment indicators are important. For my money, the very best sentiment indicator is the VIX, although few people really understand it.

    I just started an educational options blog and my first video is a detailed lesson on implied volatility and the VIX. Very relevant to Elliotticians, especially at this juncture. It's all free - I have nothing to sell and no advertising or sponsors, so I hope you'll allow me to mention it here: - just scroll down to the video.