Custom Search

Friday, April 1, 2011

Elliott Wave Update ~ 1 April

Looking at the larger picture we have Intermediate wave (C) = .618 Fibonacci of (A) at 1353 SPX.  Within wave (C) we have a very extended wave 3 which strongly suggests wave 5 should at most = wave 1 in price. Minor 5 = Minor 1 at  Wave 1 was a leading diagonal, therefore wave 5 should not be an ending diagonal which is indeed the case.  At SPX 1367.38, Minor 5 = Minor 1 in price length.

We have a lot of big gaps up to get where we are today. A close over 1332 was the goal of the MM's. Goal achieved.  The final gap above may not be easy to cover and require more work.

There are several acceptable ways to label the subwaves of Minor 5 but the main goal at the moment is to figure out the peak of Minute [iii]. Today's high would make a fine spot and "looks right".  At some point the lower channel line of this up move from 1249 would likely need to be visited either on a sideways move or a sharp move lower in an (a) wave of Minute [iv].

I suspect Minute [iv] will reveal itself over the next few days so patience is the key to allow the wave structure to unfold. At any rate, you should be able to see 5 waves on the daily since this is Minor sized. And the count below would allow that.

Waves relate to each other in many waves but the most powerful is between wave 1 and 3 or a wave A and C.   In this case the proposed P[2] is a huge (A)(B)(C) and there are powerful forces drawing it to a wave relationship of (C) = .618 of (A).   So if the SPX does indeed bolt higher eventually, SPX 1353 may be the overriding factor and not the smaller wave relationships of 5 = 1 within (C). But still, we have a target window and if we can determine Minute [iv] within Minor 5, we have another wave relationship that should act in synergistic rhythm with a larger relationship.   

No doubt the price action of the past few days has spurred on the bulls again.  I wouldn't doubt if the AAII survey next week has one of its biggest jumps. Other trader-type Intermediate and longer term sentiment measures have strengthened along with the sharp rise in prices in the past 2 weeks.

Here is but one example via Sentiment Trader. Rydex ratio at a multi-year bullish high.
Will the true Supercycle line please stand up?

blog comments powered by Disqus