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Thursday, July 31, 2014

Elliott Wave Update ~ 31 July 2014

Pretty strong selloff. NYSE declining volume versus advancing volume ended the day at 9.42:1. Declining shares versus advancing ended the day at 10.2:1. So today was a very solid 90%+ down day across the board.  

I would hesitate therefore to call this wave (iv) of [v] of 5 anymore because this is the kind of wave that kicks off major downtrends, not a mere subwave (iv).

However, price-wise it is well within the range of an expected wave (iv). The Elliott Wave rule is of course that wave (iv) cannot move into wave (i) price territory. On the SPX wave (i) is labeled at 1883 SPX.  In fact, normally the "virgin space" of the entire Minute [v] wave structure would also not be violated by wave (iv) price. Minute [v]'s "virgin space" is located at approximately 1902 - 1906 SPX. So if this is wave (iv) then this price range should also not be breached.
The Wilshire's trendline is an important trendline. We shall see how prices will behave as it is very near the trendline.  Logical spot for a bounce. A failure of the trendline could be catastrophic.  Should be fun either way!
VIX way outside its bollinger band.
Yes long-run, I do believe hyper-inflation could occur....but as most of you know, I theorize that we must first experience a catastrophic credit collapse (deflation) before.

Note where the "virgin" wave space is located on Gold's chart.
Wilshire weekly. I like it for the channels and trendlines.

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