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Friday, June 11, 2010

Elliott Wave Update ~ 11 June

Not much to say. Many won't like my squiggle counts, but again, try and apply wave personality to the squiggles and the larger counts.

We had likely a tiny truncated last wave of the final Minor wave 1. This is why it failed to fall under 1040. If you look at the NASDAQ it made a new low at that spot.

The first wave up (i) clearly is a 5 wave structure.

Wave (ii) down was a three (it lacked a wave four). It was deep like wave twos can do. It made everyone (including me) think that the previous wave (i) was bogus and destroyed most bulls' profits.

Now we get to a record 44:1 up volume ratio day in which the market went up 3% on the open in like 5 minutes. What personality is that? I'd say the heart of a wave (iii). in addition, we cannot see subwaves i and ii because that all happened overnight and in premarket.  Sometimes you have to call things like that if its appropriate. I think it is here.

We then finish out subwave iv and v and move on to the clear triangle which must be a wave (iv).  The orthodox low does not retrace into wave (i) price territoy.

Then the thrust up out of the triangle is wave (v). The question is, will (v) extend higher than we think? We'll see Sunday/night and then Monday.

So all in all we have a 5 wave move up. Make no mistake, its not a perfectly channeled structure, but its a countertrend structure so its supposed to look like crap!  But all-in-all considering that it is cutting back up into a candle that produced a record down volume ratio day of 119:1, its doing pretty darn good!

The bigger picture is we are looking for [a] of 2 is the best count. If Monday opens bullish, it will break the green RSI resistance line and that will also help identify this as a Minor 2.
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