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Monday, October 12, 2020

Elliott Wave Update ~ 12 October 2020

Primary count is that wave 5 of (5) is tracing higher and will eventually become new all-time highs. It almost made it today. The count below is not ideal, however, there is alternation between waves 2 and 4 (flat versus zigzag) and breaks no rules. 

Of course our old count is not quite dead yet...
There was a very significant breadth thrust event triggered on the NYSE after last Thursday's close. It was not a Zweig event, as that requires a thrust from below .40 to above .615 in 10 trading days or less.  After crossing back up over .40 line, it made it on the 11th day.  This is the second breadth thrust event on the NYSE since March. the first event took 13 days to trigger. 

Thus you could argue that this event is "stronger" than the first because it did it in less time. However, looking at the 2 events there is a huge disparity between gains. 26.9% in the first event from close to close. This last event? 6.7% from close to close. I don't know if that's a significance, but its something to keep in mind.
Of course, if the breadth event ensures the market will continue higher into 2021, we would have to consider the following count in play. This would keep our count that the early September high was a 5 wave move just like I counted, however its only wave 1 of (5). 3, 4 and 5 would be much smaller most likely.

But its way too early for this speculation. I'm throwing it out here for those who consider the breadth event a long-term game-changer.

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