Pretty clearly, we are in the 3rd Wave (& 2nd Up Wave) since the March 2009 low. Generally, I understand that Elliott Wave says that there are 5 waves in a motive move, and 3 waves in a correction.
So my question is: do the Elliott Wave types expect 2 more waves to make this a 5-wave motive up move? Or do they see this as a bear market correction (and thus expect C to be "it"), and we start our next down trend once C is completed?
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Posts
couple perspectives
ReplyDeleteET
http://www.youtube.com/watch?v=G_orM3WT-XE
Daneric
http://danericselliottwaves.blogspot.com/
An Elliot expert should not be expecting anything specific or the view is colored by biases.
ReplyDeleteThere are probabilities only. If the assumption is correct that the rise from March 09 is an ABC then either a current completion or further waves higher are possible.
I have been following some EW blogs and it appears about 35-40% are bullish and expect new highs (above the Oct. 07 highs) and about 55-60% are bearish and believe that we are near the final top of this rally...and we will be on our way below the March 2009 low.
ReplyDeleteTony Caldero is bullish - http://caldaro.wordpress.com/
You can find several bullish and bearish views out there...just up to you to decide. The interesting thing is most of the bullish guys are calling for a 10% correction in the 1295 to 1330 area as a top...and a bottom around 1170, before another super strong move up to new highs (above whatever high we put in here).
Hey Parker,
ReplyDeleteI don't know what the other EWT guys expect but for now my 2 possible counts are:
Where you have on your chart 'A' I have "1"
Bullish case: your "b" is my "2" C is my "5 and end of wave 1 of a larger 3" (confused yet) So in this count i would expect an a-b-c correction of the up move from July 2010 lows. The wave 2 correction that this would predict would stop above the july 2010 lows and then resume into a strong 3rd wave up.
Bearish count: Still i have your "A" as "1". July lows, your B, I have an "A", the "C" on the chart is my "B" and i would expect a "C" wave down below july 2010 lows but above the 666 low. This would be an ABC correction of the
5 waves up from the March 2009 lows. I admit this is a strange count that doesn't look quite right. I'd be interested to hear if anybody else thinks this could be a valid count
For now sentiment and put/ call ratio's and declining breadth are confirming the 5 wave top is in or very near. I'm not locked into any scenario beyond the immediate top.
Good luck figuring out my rambling!
Agree with Luv them waves.
ReplyDeleteMy personal opinion is that 1217 is the line of demarcation. If we fall below that - the odds shift to this move being an ABC, while dropping to that point, and then making another high high will suggest that the entire move off of the Mar lows is a impulsive, bull-mkt move. Why 1217 - below that level, Waves 1 and 4 would overlap - an EW no-no.
Many thanks for your input, everyone.
ReplyDeleteGood point about the overlap, Achal. I remember that from the book.
I guess the other rule that could come into play is that 3 can't be the shortest wave of a motive move.
Since the Wave 1 was so large (83%), Wave 3 will almost surely be smaller than 1. So if we get a Wave 5, it will have to be smaller than 3.
Finally, I remember something about alternation between 2 and 4. If 2 is a sharp decline, expect 4 to go sideways and vice versa.
I guess I don't know whether the May-July 2010 correction should be considered "sharp." It certainly wasn't sideways.
Achal,
ReplyDeleteThe overlap at 1217 wouold only come into play if this is the entire wave 3 from the lows. While wave 3 cannot be the shortest there is also nothing that says it cannot extend, such as jasinhbca suggests for a bullish count. Because of that 1217 cannot define the difference between a bull and a bear. Below 1010 would do the trick absent some unlikely counts, although it should not get near that level on a bullish count.
From my prior post............
ReplyDelete"Those that are familiar with Spirals of Growth & Decay or have a general understanding of Elliott Wave Analysis should note that the lows made in July 2010 confirmed a Wave 4, thus the current market rally is a 5th-wave advance within a 10-year Bear Market Cycle." Good trading!
Be ready for a 100 different answers. Here's my 2 cents fwiw. Since the top in 2000 everything has been 3's. The current rally is the final rally before the bear market resumes down. The market appears to be in the final 7th wave up of a large ending C off the July '10 bottom. The target for a final top could be anywhere from 1300 to 1320. I would expect a lower low below the March '09 bottom.
ReplyDeleteWhile I have only seen one other count similar to my view, I personally am of the opinion that the current rally is an X wave that is separating waves W and Y of a very large combination flat correction where the 2009 low was the end of wave W (a flat). Wave Y could be a double zigzag, a triangle, or possibly even an impulse down which may or may not retest the 2009 low. The larger cycles with expected lows in 2016/17 and 2024/26 support this view. If this is the correct interpretation then wave X could top now or higher than the 2007 highs. I personally suspect we have more to go on the upside with at least an approach to the 2007 highs.
ReplyDeleteLuv,
ReplyDeleteYou are right. I am dealing in probabilities though - a drop below 1217 forces a I/II/i/ii count, which is possible, of course. A drop below 1010.91 forces me to re-evaluate as an A/B/C possibly, but that still leaves the current highs as a (A), with the drop below 1010.91 as a possible (B).
So - worthless, except for probabilistic analysis.
I haven't found Elliot Wave to be useful as there are so many ways to interpurt the waves.
ReplyDeleteTo the question of where is the market going you might want to look at Andrew Butters valuation calculations: here's the link
http://www.marketoracle.co.uk/Article25287.html
Basically S&P to 1750 or now 20% undervalued so an orderly Bull Market forward.
Mr. Butter looks at cycles as created by over/under estimates by the markets (i.e. emotions and misinformation plus a valuation system - P/E - as being flawed). But there is a cyclical swing to the correct value.
So it's a fundamental view of oil prices, GDP, interest rates, etc. not natural laws al a Gann, Elliot, etc.
So this rally and pull backs goes till oil hits $150, Gold hits $2000, and S&P hits 1750. There are many "bubbles" that can collapse this forecast but like all black swans those in your gun sites won't be the ones that crash the system