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Thursday, August 16, 2012

Elliott Wave Update ~ 16 August 2012

I consider the Wilshire 5000 the ultimate arbiter of the overall wave form of the markets.  For now it is 200 points below its previous peak.
S&P daily. Bearish rising wedge? Its internal wave structures count better as "threes" rather than impulses. That is a trait of an ending diagonal triangle (although I have this chart labeled as a triple zigzag). And this would probably be the biggest one ever.
SPX 30 minute.
NYAD count:
INDUSTRIALS count long term.

1.) Note how the 2007 high is considered a "B" wave no matter what the count. The only question is at what degree.

2.) Note that the rise since 2009 is considered a "three" no matter what the degree outcome turns out to be.

The two points above are important to consider in the overall count since the 2000 orthodox social mood peak.   Whether or not the rally since 2009 is a Primary wave (2) or a cycle wave b (or even cycle x) is a moot point at this junction. Because both counts say the same thing: A nasty primary wave [3] down of cycle c or a complete cycle wave c itself is coming around the corner.  

There will be no great distinction between a wave [3] of cycle c or an outright complete cycle wave  c itself.  Both will involve intense selling.

Were bonds in a wedge? A subsequent price collapse is a clue and so far prices are cooperating. Wedges are signs of exhaustion and occur only at endpoints.
Well at least the GDOW is cooperating with the overall count:
Ask China if they are in the grip of a bear market.
Or Japan:
CPC (yesterday's close)
Uh Oh. Rising 10Y yields are not bullish due to the record debt that needs to be serviced. And if mortgage rates take a hit, watch out for housing again.

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