If we rally much past 1195, my "long-shot" count for a triple zigzag (mentioned a few posts ago) may be unfolding.
Tuesday, September 6, 2011
Looks like the "Possible Short Term SPX Count" chart nailed it...
Here's the chart from before yesterday's open, updated with the actual price action. Looks like a dead-on hit! Alternate count can't be ruled out yet; if the alternate is correct, we may need one more low to complete this first wave. My wave 2 target is 1195. After that, we should see another fast downdraft, which finally breaks the uptrend.
If we rally much past 1195, my "long-shot" count for a triple zigzag (mentioned a few posts ago) may be unfolding.
If we rally much past 1195, my "long-shot" count for a triple zigzag (mentioned a few posts ago) may be unfolding.
Monday, September 5, 2011
Can the DAX Shed Light on the SPX?
During the 2008 crash, the DAX often seemed to lead the US markets. Since the SPX count may be open to a bit of interpretation, I decided to take a look at the DAX to see if that brought any clarity. The DAX has formed a much cleaner pattern, and looks like it will bounce around a bit (in a fourth wave) for a few sessions, then bottom soon after. My target is 5100 +/-. I have reasonably high confidence in this target, since I arrive at roughly the same number using two different methods of target calculation.
This would argue that my preferred count of the SPX now being in wave (v) of minor 1 is probably the correct count.
The alternate count allows for the possibility that wave 4 may have been a running correction, in which case we are only bottoming iii, and will do one more up-down series to complete iv and v.
Bears should be wary of an IT bottom forming soon. The coming minor (2) rally will likely retrace 40-60% of the prior decline. The minor (3) set to unfold after that top will be a fast and furious crash wave.
This would argue that my preferred count of the SPX now being in wave (v) of minor 1 is probably the correct count.
The alternate count allows for the possibility that wave 4 may have been a running correction, in which case we are only bottoming iii, and will do one more up-down series to complete iv and v.
Bears should be wary of an IT bottom forming soon. The coming minor (2) rally will likely retrace 40-60% of the prior decline. The minor (3) set to unfold after that top will be a fast and furious crash wave.
Possible Short Term SPX Count
This is the best count I can see given the current squiggles.
If my placement of (iv) is correct, the market will likely make a (very) short term bottom today. If my placement is incorrect, and we move (iv) over to the print high, we should get one more up-down than shown on the chart, to a marginal new low/double bottom.
There is an outside chance that this is the start of something bigger; the strength and speed of this wave so far gives rise to the possibility that this may not be the wave v we've been looking for. If you refer to my SPX chart a couple posts down, the wave labeled as the large (iv) may in fact be (2) minor. If that's the case, this is likely wave 1 of i of (3) minor, which bodes very ill for this market. No need to throw out the preferred count yet, though... until we're given concrete reason to think otherwise, we will stick with the preferred view that this is wave 1 of v. I don't consider it likely that this is the start of minor (3), but the possibility exists, so I wanted to bring it to your attention.
Please note that this is the most likely preliminary count, but with the futures acting crazy tonight, the cash open may bring other possibilities. At that point, we'll have to see what what form the waves take -- and how our confirming indicators look -- to determine if any adjustments are needed.
If my placement of (iv) is correct, the market will likely make a (very) short term bottom today. If my placement is incorrect, and we move (iv) over to the print high, we should get one more up-down than shown on the chart, to a marginal new low/double bottom.
There is an outside chance that this is the start of something bigger; the strength and speed of this wave so far gives rise to the possibility that this may not be the wave v we've been looking for. If you refer to my SPX chart a couple posts down, the wave labeled as the large (iv) may in fact be (2) minor. If that's the case, this is likely wave 1 of i of (3) minor, which bodes very ill for this market. No need to throw out the preferred count yet, though... until we're given concrete reason to think otherwise, we will stick with the preferred view that this is wave 1 of v. I don't consider it likely that this is the start of minor (3), but the possibility exists, so I wanted to bring it to your attention.
Please note that this is the most likely preliminary count, but with the futures acting crazy tonight, the cash open may bring other possibilities. At that point, we'll have to see what what form the waves take -- and how our confirming indicators look -- to determine if any adjustments are needed.
Sunday, September 4, 2011
SPX Current Elliott Count
There is still an option for a larger rally, but it's less likely after Friday's action. The bulls main hope would be if we replaced the minute iv and v with "a" and "b" because Friday's move was clearly an impulse down. The only thing that makes me nervous about this count is it seems like too many technicians are expecting it.
One possibility (not shown) would be a triple zigzag. In that scenario, we would now be forming an X wave (see (b) for example) and would then form another move upward like (a) and (c). That would confuse the greatest number of market participants, so I would consider it a reasonable possibility. I'll try to warn you if it looks to be unfolding.
One possibility (not shown) would be a triple zigzag. In that scenario, we would now be forming an X wave (see (b) for example) and would then form another move upward like (a) and (c). That would confuse the greatest number of market participants, so I would consider it a reasonable possibility. I'll try to warn you if it looks to be unfolding.
Saturday, September 3, 2011
Grand Supercycle Dollar, a 300-year study
Here's a long-term Elliott study of the dollar I just completed. The study encompasses everything since the dollar's inception. Took more than a few hours. ;)
Since the DX index has only existed for about 40 years, I had to find a proxy for earlier price data. I selected "dollar purchasing power relative to gold" as the proxy. Credit for the base, unannotated long-term dollar and dollar/gold charts goes to Sharelynx.com.
It's an interesting study, and the implications of the results are numerous:
1) The long-cycle corrective wave since the dollar's inception implies that the dollar was "near perfect" when introduced, and thus has been correcting ever since.
2) The potential of a base in the Grand Supercycle wave implies a century-plus-long rally from the 2008 print low.
3) There is a strong implication that the dollar may be on its way to eventual extinction. If the Grand Supercycle wave HAS based, extinction will be a long time off while we rally in Grand Supercycle B for a century or more... if the wave hasn't based, extinction may come in the next few decades.
4) There is a very clear indication of gross mismanagement by the dollar's shepherds (i.e.- the government), and of the systemic rape of America's wealth by those in power. But we knew that already.
This should lead to a long, sustained bull market in the dollar. Here we have a 300-year chart that seems to be telling us that right here, right now is an inflection point and potential monster trend change to the prior 300 years.
Since the DX index has only existed for about 40 years, I had to find a proxy for earlier price data. I selected "dollar purchasing power relative to gold" as the proxy. Credit for the base, unannotated long-term dollar and dollar/gold charts goes to Sharelynx.com.
It's an interesting study, and the implications of the results are numerous:
1) The long-cycle corrective wave since the dollar's inception implies that the dollar was "near perfect" when introduced, and thus has been correcting ever since.
2) The potential of a base in the Grand Supercycle wave implies a century-plus-long rally from the 2008 print low.
3) There is a strong implication that the dollar may be on its way to eventual extinction. If the Grand Supercycle wave HAS based, extinction will be a long time off while we rally in Grand Supercycle B for a century or more... if the wave hasn't based, extinction may come in the next few decades.
4) There is a very clear indication of gross mismanagement by the dollar's shepherds (i.e.- the government), and of the systemic rape of America's wealth by those in power. But we knew that already.
This should lead to a long, sustained bull market in the dollar. Here we have a 300-year chart that seems to be telling us that right here, right now is an inflection point and potential monster trend change to the prior 300 years.
How did the chart know 100 years ago -- or even 20 years ago when we were bottoming the c wave, before the Euro existed -- that the European crisis would be unfolding now? How did it "know" to develop the pattern it has developed? It's almost as if there's a secret mathematical formula designed into human psychology and creation itself...
It's certainly food for thought.
It's certainly food for thought.
Long term Elliot Wave count for SPX
Here's my updated preferred long-term count for SPX.
On the larger cycle count, it's really difficult when you get into time-frames like the Grand Supercycle, because you get into trying to approximate waves without price charts (so you're trying to plot civilization -- how much downslope do you apply to the dark ages? How does it fit in relation to the renaissance? etc.). There is an outside chance that 2007 marked a complete series and Grand Supercycle V's top. My final annotation has a little fun with that idea -- at least, I hope it's just a little fun.
On a more serious note, I give it about a 35% chance that 2007 DID mark the Grand Supercycle III top. Hopefully not, because that would mean we're in for decades more pain than even we're anticipating. With the GS III count, the long-term Dow target would be somewhere in the range of 1000.
On the larger cycle count, it's really difficult when you get into time-frames like the Grand Supercycle, because you get into trying to approximate waves without price charts (so you're trying to plot civilization -- how much downslope do you apply to the dark ages? How does it fit in relation to the renaissance? etc.). There is an outside chance that 2007 marked a complete series and Grand Supercycle V's top. My final annotation has a little fun with that idea -- at least, I hope it's just a little fun.
On a more serious note, I give it about a 35% chance that 2007 DID mark the Grand Supercycle III top. Hopefully not, because that would mean we're in for decades more pain than even we're anticipating. With the GS III count, the long-term Dow target would be somewhere in the range of 1000.
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