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Tuesday, October 6, 2009

Elliott Wave Update ~ 6 October (corrected chart note)

UPDATE 6:40 pm: corrected chart note. I should have clarified. Since I have wave 1 of (C) the longest, and wave 3 cannot be the shortest, therefore upside of wave 5 is limited to 1120 max.

I think this is one of those time when you have to sit back and look at things from a afar. And when you do that you see a definite 3 wave pattern emerge from the 666 lows. A wave 2 of any degree is typically a zigzag.

So in going back to basics, I'm plotting a simple zigzag for P2 on tonight's chart. What does this mean? It means the market it now in its final wave up. A wave 5 of (C) of P2.

Is the count really like this? At this point I think its moot. I don't think technically the market is in great shape at all and bullishness is very high still. This would align with a final wave 5
type thinking.

I am not sure all indexes and sectors will make new highs. I think some will likely fall short. That will help confirm things in general.

It made me ponder why the market stopped at 1019. And then it dawned on me that 1018 was the wave 1 high as I have marked. So if the market is going to respect that 1018 price range, I will take it as such and call this a wave 5 of (C) of P2.

And I feel very good about taking this approach. It limits the upside to about 1120 max as wave 5's cannot be longer than wave 3's.

If the market does breech above 1080, I think technically it will be showing negative divergences on the weekly which is a kiss of death. So there you have it. Primary count is wave 5 of (C) of P2. And the target range is 1080 - 1120.

I still like 1098!

And in 4 days (C) = (A) in trading time at 67 days each.

There are lots of commenters contributing lots of ideas. If I picked up on some of those ideas I apologize for not giving credit, please do so in my comments and lets see if we can nail this one.

I am actually excited as I feel a simplification at this point is needed. And I still think we are very close to turning down for good. This feels like final spasms of a reckless rally.

The (close) alternate count? That its in P3 of course already (1080 was the high).
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