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« Predictions 2009 | Main | The Beginning of the End of the Beginning »

Sunday, January 04, 2009

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dlu

Yelnick,is it wave 4 triangle or wave (4)triangle in EWI's stu ? Because both counts are valid.

yelnick

dlu, wave (4) of the action back to the Oct07 high. They have two counts: leg c of a triangle which started on Nov4, or subwave A of a double zigzag which started after an ending diagonal on Nov21. The double zigzag had a first zig or W wave into Thanksgiving and ending Dec8, then a flat X wave that ended just after Xmas on Dec29, and the belated Santa Rally over the past week has been the wave A of the second zag or Y wave. A B wave drop is due, followed by a final C wave to end wave Y and (unless it subdivides further) wave (4). Under the wave (4) triangle their expected end of leg c is between now and SP950. Under the double zigzag wave (4) the expected end of subwave C could be higher, with an initial level of SP964-7, and then SP1005-7. Or possibly higher. They are holding to the triangle for now, but the ending diagonal plus this zigzag seems to fit better. If the Y wave (the second zigzag) goes above SP1000, there will be a huge chorus proclaiming the bear over. What a better time for a head fake and drop to new lows!

dlu

thanks yelnick.

Forkoholic Serge

Anyone knows Jan 15th or 16th cycle date - High or Low?

Auggie

Back in the glory days Bob Prechter used to forecast target prices years in advance. Does anyone know his current long term forecast for the gold price? I assume his old $200 forecast has been "updated" ?

Also, how is he counting the wave structure from the 1999/2001 lo?

Many Thanks!

Puravida19

EWI STU is saying Gold is about to drop unless it doesn't.

Hank Wernicki

Monday January 5th
4:35 pm

The " Trade of Year 2009 " Video will be posted soon on the Gold Shares XAU and HUI

Within one to two weeks the indices will reverse down along with Gold

Traderpro

I don't forsee the triangle, I mean, when is EWI right? Twice a decade?! I think the pattern will be sharp in nature, sentiment and monetary policy will warrant a ZZ or double three pattern involving a ZZ. We shall see how SPX 1000 reacts though. Looking at the NDX 100, maybe we are on "C wave" now, after a running flat B wave for a ZZ overall pattern. Love the site, yelnick..

http://traderpro.wordpress.com/

Hank Wernicki


DO MARKET FRACTALS REALLY WORK ? READ TODAY'S SUCCESS STORY .... WE MAKE MONEY !


Monday's "Amazing Fractal Forecast"

1/5/08

"I was fortunate enough to invest in XAU

Put options based on your web site recommendation."

"I sold them today for a profit of slightly over 10K."

Thank you. ... Steve

Coming Soon

The " Trade of Year 2009 " Video

puravida19

Yelnick, what's confusing me is what happened to the idea of capitulation at a market bottom like we just experienced in November? EWI says it has yet to be, your rallymongers(?) ignore it.
Doesn't this type of 5 wave drop demand capitulation before the market can rally? Aren't your bloggers ignoring that?

yelnick

Puravida, caveat capitularum - 'capitulation' is shorthand for a distribution behavior at a bottom (sellers exit, buyers come in, huge volume, little market movement either way). I recall Oct10 2002 as that way for example. Yet patterns like that can fool, which is why EWI focuses on waves, using such 'side indicators' to increase or decrease confidence in the wave count. But you knew all that - the answer to your rhetorical question is if it weren't for the rising bullishness of the herd, you wouldn't be about to have a great shorting opportunity. Neely just sent out his New Year's emergency bulletin, and it is a doozy. Beware the ides of the S&P - SP1006. More later.

Sean

Yelnick, "Neely just sent out his New Year's emergency bulletin, and it is a doozy. Beware the ides of the S&P - SP1006."

So you mean Neely just went short? Thanks

yelnick

Sean, he is preparing for a short. His day traders are modestly short. Exceeding SP1006 breaks his count.

Kcinley

Based on today's news, it may be time to acquire some physical Au and/or Ag; if you can even find any, that is.

Auggie

Well, Rick Ackerman answered the exact question I asked above!

http://news.goldseek.com/RickAckerman/1231225260.php

Gleen Loser Neely

HERE COMES THE LOSER AGAIN!!
WOLF....WOLF...WOLF...

HERE IS THE LOSER'S FORECAST!!

A new president will soon be sworn into office, markets are recovering and there is an emerging optimism that the worst may be over. I'd be so happy if that were true. NEoWave structure, unfortunately, tells me the worst is just about to begin. Within less than two months (it could be as soon as a few weeks or even less), the S&P should embark on one of its most violent, scary declines in market history. Wave structure currently suggests a 50% decline (from current levels) is possible in 1-2 months! The markets are not prepared for this; the world is not prepared for this, but we will have to deal with it. The only way this will not occur is if the cash S&P is able to exceed 1006 before breaking last year's low. If 1006 is exceeded, then the future is not clear and I will have no opinion for a while. As long as 1006 is not exceeded, the outlook is dire.

As most of you know, I turned officially bearish on the U.S. stock market in mid January 2008. From that point forward, the S&P moved almost exactly as expected all year. Unlike the last 12 months, the next 12 months will be the most treacherous we've ever seen. The only good news I have to report is that, after the big drop, the bear market will be over; but, by then, no one will believe me and the majority of the public will no longer be interested in the stock market. Mutual fund redemptions will reach historic levels - within 1-2 years, financial business and radio shows will start to go off the air and the public's disgust with Wall Street will be so high that a pandemic of law suits will breakout.

I do not like being the purveyor of bad news, but wave structure tells me 2008 was just the warm-up for what's coming. Please do everything you can to prepare for this major, financial storm.

sincerely

Glenn "Loser" Neely

DG

Near the beginning of the last hour on the NDX I saw a terminal impulse form, which would also signal the end of the correction from November, if real.

Following all of Neely's trades in the S&P 500 since October 9th with futures would have netted you over 200 points (10 winners and 8 losers), so I wouldn't take it lightly when he says something huge is coming soon.

Don't listen to the naysayers, check it out for yourself. And trade like Neely recommends, don't just "bet it all on black" and lose all your money in one trade, which is how some people probably traded and those people are now reduced to calling people "loser" on internet blogs. Sad, really.

Min

Closed my second NDX long, moc, for a nice gain.

Feel we have longer to go on the rally but also see a tradeable pullback first.

I'll be sitting this one out, after nailing two in a row, thinking I can make it three is plain tempting fate. I hope I don't regret this decision...

Well maybe I'll try just a teeny tiny short, what the hay... we'll see what the market says tomorrow.

Howard

How does one get on the Neowave email list to receive his updates?

Gleen Loser Neely

Howard,

Just send an email to loser@neowave.com

Be sure to include on the subject: I want to join the loser's list.

Glenn Loser Neely

DG

Howard,

Go to the website and sign up for the "question of the week" e-mail list. That should get you on the public announcement e-mail list as well. Neely typically sends out one public announcement per quarter, on a market that's about to move, according to his analysis, so it's not a "spam" list by any means.

Howard

DG,
Thanks for an intelligent response.

Loser Neely

WOLF...WOLF...WOLF..

Glenn "Loser" Neely sent an emergency update!!!!. However read the following link,

http://www.traders-talk.com/mb2/index.php?act=attach&type=post&id=9299

As of Monday Jan 5th he is BULLISH on the hourly picture and Neutral on the Daily....

This loser is nuts! Who understands this idiot?... The same day he sent his "emergency" update to non-subsribers, he is sent something different to his subscribers....

He is only playing the "wolf...wolf game" so he can get more clients...

Just ignore this loser... his service sucks.. and his neowave garbage is just that....garbage!


DG

Howard,

Sure, no problem. At least now Loser Neely is admitting that the problem is he doesn't understand what Neely is saying.

That non-subscriber e-mail never said that the expected wave down would start immediately. That "bullish" and "neutral" stuff is Neely River. Neely is "bearish" on the Weekly, until the price mentioned in the e-mail (1006 S&P) and that is actually the one to pay attention to in connection with that forecast.

Hank Wernicki

Today at the close the NQH9 has started a Parent Iteration of its

Child fractal from 12/19


What this means is that IF the 1244 level is not taken out to the

upside we can expect a big slide down ( it's almost perfect )


Breaking 1232 would confirm the decaying fractal to the downside.


Conversly holding 1232 tomorrow would represent a bottom


That's the trade for tomorrow

Cheers

Hank


Min

I count 5 small waves down on NDX. Looking for a 3 wave bounce tomorrow lasting all day then might go for a small short with a tight stop... maybe (as I told myself I would sit this one out)...

Loser Neely

EMERGENCY UPDATE!!

ALIENS WILL ARRIVE IN FEBRUARY.... I SEE DEAD PEOPLE!
THE WAVES "TOLD" ME THAT A CRASH IS IMMINENT
SELL THE MARKET!!.

GLENN LOSER NEELY

DISCLOSURE: I WAS UNDER DRUGS WHEN THE WAVES SPOKE TO ME.

DG

If I have a choice between listening to Neely's waves "speak" or the voices inside Loser Neely's head, I know which I'll choose.

So far, market behavior is completely consistent with the terminal impulse I counted on the NDX on Tuesday. For continued consistency with Neowave logic, we need to get under last Monday's low by next Tuesday, the 13th. From there, we could bounce around in a correction for a while before heading down again to new lows.

saahilcap

does anyone know what Arch Crawford is thinking these days?

TObject

Arch Crawford is chasing Dec 12th low ;-)

Wavist

Hmm, DG's record of Neely's trades says something very different to me. 10 winners, 8 losers and 200 points gained sounds pretty much exactly the results to be expected from a purely mechanical trend following trading system. Which isn't to say that all he is doing is following trends, as to the contrary he often trades against them when anticipating a turn, however the concept behind the long-term successes of such a system is simply that by cutting losses and running profits you will gain more than you lose. This confirms my long suspicion regarding Neowave - Glenn Neely's success or otherwise as a trader is completely unaffected by his directional forecasts. The same results will be gained by following computerised trend calculating instructions, modified by taking overbought/oversold indicators into account to anticipate turns. Some will say there's nothing so bad about that. To me however if his forecasts are adding virtually nothing to his performance there is only one possible explanation - and it confirms that Neely can be added to the long long list of market forecasters - including Tony Caldero who as we all know was outed back in February last year as having a performance record with no correlation to the market and EWI whose record has been far worse than uncorrelated in similar testing (takes some doing I know, but it does at least make them potentially useful as a contrarian indicator), whose long-term successes derive entirely from reactivity and CANNOT be relied upon to forecast short-term market movements with any degree of accuracy above that gained by tossing a coin.

DG

Wavist, with only 18 trades even if all 18 were winners that would not prove anything because the sample size is too small. I was simply saying that posters on this thread are trying to portray his record as one of unremitting losses, when in point of fact, he's been doing pretty well in what's been a very tough market since September/October. I was taught the same efficient market hypothesis everyone was in business school, so I know all the arguments. What I also know is that Neely has made some very timely macro-level market calls in the three years I've followed his work and is one of, if not the only person whose work I've followed that basically got them all correct.

If you work your way through the Google results on Neely's name, you will also find some transcripts of discussions he had in the 1990's that indicate not just that his work enables him to at times follow trends correctly, but also find price levels where meaningful reversals occurred that, if followed as a trade would have led to significant gains. You'll also find a multi-year contest with some very interesting results that I would guess are close to his long-term average returns, perhaps even lower because he, according to his own subjective report, has gotten better at forecasting than he was in the 80's and 90's, FWIW. Also, to compare him to other trend-following systems, you'd also need to know how many average points were gained on a winning trade. If I have a trend-following system that gets me 10 points per winning trade and a trend-following system that gets me 20 points per winner, I would argue that, all things being equal, the 20 points per winner was a better system. Then, what are the other systems processes for setting risk levels. In my experience, wave theory has the absolute best risk-setting process of any trading method. Others methods could, theoretically, end up setting the exact same risk levels as someone trading with wave theory, but no trading method could minimize risk more than wave theory does. As Neely says, your risk exposure on a trade is the one thing you can control in trading, so make sure to control it. He actually goes further and says that risk management is THE key factor in trading success and it's precisely because it's unknown whether or not any forecast will be accurate and it's unknown if markets are random or not.

Wave theory obviously makes the assumption that markets are not random, but who is to say with absolute certainty that wave theory is correct in this? It's simply a hypothesis to enable certain actions to be taken. Even though I do THINK that markets are not random, I always hope for LUCK on every trade anyway, but if wave theory tells me my hypothesis for making a certain trade is wrong, I need to take my loss and move on. However, if wave theory tells me that we're on the cusp of a 50% decline in the S&P and that I can place a bet on that decline with, let's say, a 10-15 point stop-loss, that gives me a 30-50 to 1 risk-reward ratio. That one trade could make a man's life do a 180 degree turn, at least financially. And there will be another set-up of the same nature once we reach a bottom, although the rise won't be a fast as the decline, in all likelihood. If we're at 500 S&P and a 50% retrace of the whole move down from 1600 is on tap and you can take that trade with a 10-15 point stop-loss based on a wave count, why wouldn't you?

The underlying logic of NeoWave is actually pretty simple. It is that every single "grand slam" trade starts off with certain elements relating to price, time and the relationship of those variables to the market action immediately preceding. Or, you have to be able to know how to jump on a move at precisely the moment it first shows "ten-bagger" (let's say) potential. Combine that with a perspective on what the "last gasp" of a prior trend is and what you have is an "engine" for making trading hypotheses with strictly defined risk. Neely uses price movements, not price levels, to forecast. You know that saying "Well begun is half done"?. That's sort of the Neowave "philosophy". If the markets are truly random, it's probably meaningless, but if the markets are not random and "well begun" actually means something to future price movements, it's important to understand how to precisely identify those moments and to use price and time to do so. At the very least, I've never seen Neely fight a trend the way EWI can. As he said in one of his market alerts, when something you don't understand happens, just go with the flow.

That's the reason Neely never uses indicators, because they are just derivatives of price and are a secondary factor compared to logic. People shorted overbought indicators during the last two bull markets and have been buying oversold indicators recently. With NeoWave, until very specific price-time combinations appear, the trend is the same direction it has been, even when you don't have a wave count.

Also, define "short-term". It's ironic that you say that on a day when Neely sent out a bulletin advising a certain action. That bulletin arrived within 15 minutes of the reversal he was looking for. Does it always work out that way? Heck no! But, I did get out of a trade at the best price of the day and I had just been saying to myself that I didn't like the action, primarily because of what I've learned from studying NeoWave. I was pissed to have to exit the trade before I wanted to, but I'm glad I exited.

I have a few unanswered questions about Neely myself and he seems to be a fairly reclusive guy, although very accessible by e-mail, but at this point I'm pretty sure he's "adding value", although if anyone has evidence to the contrary (backed up by data, not generalizations), I'm happy to listen. Also, if he was always 10 for 18 (11 for 19 after today), that actually is better than tossing a coin!

Just one trader's opinion, of course, but I have tried to back it up by actually looking at the available data on his track record and comparing it to other prognosticators.

TObject

Tomorrow morning, we get the official employment figs. At 8:30

This release tends to be a market mover.

Preliminaries were really terrible.

Question is: “How much of the bad news is already in the market?”

We are not against being short over the very near term because of really bad astro-indications on Fri Close!

Then there is the Full Moon over the weekend, AND the Mercury Retrograde Station – which could be a reversal or it could precipitate another sharp decline thru next week.

We prefer to be Neutral over this treacherous time, or play tactically for very short-term profits and be ready to jump EITHER WAY!

If you are already short, it may pay off here – but it is a chancy bet.

Would not play a heavily directional game until at least after 10am Fri – to see which way the wind blows.

Our own positions are LONG GOLD, and Long GM and we are thinking of hedging with a number of out-of-money puts

JUST IN CASE.

Remember that markets CAN DO ANYTHING, and keep protective Stops on ALL positions.

Arch Crawford

Crawford Perspectives
520-577-1158
www.CrawfordPerspectives.com

Wavist

DG, nice piece, I do want to say though that you don't have to convince me of the value of wave theory and of taking a position to gain from a forecast decline. I had a running argument with the head of EWI's European Forecasting service back in September 08, when he was calling for a resumption of the bull market and I told him first on the 9th of September:

Tom, to my inexpert eye today's low looks like the end of a fractal 1 of wave 3 down that began on the 8th September with wave two going anywhere up to 6280 in the Dax and 5458 in the FTSE for a .718 retracement. This would be expected to rise in three waves with wave a having ended at 6205/5365 and so an equal wave c targeting 6285/5436. With the speed of the rebound so far this would be expected to occur fairly soon (as what is provided in movement is lacking in time) whereupon we would bear witness to the birth of wave 3 of 3 of 3 from 19th May. If I am correct we are about to see a breakdown of epic proportions....Not to make too large a point of it but IF I am correct we are not merely in the 11th hour but at 11:50, and I would expect another violent rally early next week perhaps as high as 6350/5500 after which the world will collapse.
Wishing you a good weekend!....

And then after the historic decline...and recovery of the following couple of weeks, when he kept saying that the '3 wave' decline is over, I sent this to him on 27/09/08 (a little long and wordy):

Dear Tom,

I have been studying the charts for the FTSE 100 over the past few weeks and I am afraid that I find myself in quite definite disagreement over both the last years action and most importantly the next stage. I would like to show you what I read if I may: The index had a final top in October 2007 at 6730. Since then a five wave decline has proceeded with wave 1 complete in November at 6078, wave 2 in December at 6568, wave 3 in January 2008 at 5546, wave 4 in February at 6121, and finally wave 5 in March at 5461. This completed wave 1 of a larger 5 wave decline. Wave 2 up proceeded in a textbook 3 waves with wave a complete in April at 6007, wave b at 5821, and wave c in May at the grand level of 6390. At this point the declines were showing all the signs of waves 1 & 2 as nobody really believed yet in the markets collapsing. We all thought the worst was behind us and it was only up from here. What unfolded next was therefore not awfully surprising from a wavist perspective.

At first sight the 'big' decline from May looks like a wave 3, with wave 4 ending in August and the entire 5 wave decline complete a couple of weeks ago. Indeed I saw a completed five wave decline in 'the big week' in September to 4813, so I came straight out of my sells and bought into what I expected to be wave A of a 3 wave correction of the decline from November 2007 . If I still believed this to be correct I would have no trouble in going along with your expectation of a sharp rally early next week. But I have in fact switched my buys for sells once again. I'm pretty sure my initial reading was wrong.

This is because upon measuring the relative sizes of the waves I discovered that the 'big' decline from May is an optical illusion. It is in fact significantly shorter than wave 1. 'Wave 5' is only a third of the length of wave 1! This brings me to a shocking and horrifying conclusion: the May through July decline looks like it may only be wave 1 of 3, with wave 2 of 3 ending in August. In practical terms what this means is that the entire five wave decline from the end of August to mid September is only wave 1 of 3 of 3, with wave 2 complete on 19th September at 5406.

If this is correct the short term movements since 19/09 are a wave 1 of 3 of 3 of 3 complete 25/09 at 5067, wave 2 of 3 of 3 of 3 complete 25/09 at 5247, wave 1 of 3 of 3 of 3 of 3 (pretty huh) completed today at 5055, and finally within this wave 2 of 3 of 3 of 3 of 3 I see a completing three wave advance. It doesn't look quite finished yet and so I will not be surprised if it does end up going all the way back up to 5075 next week but the correction (if that is indeed what it is) is effectively over.

Anyway, if I am correct the declines that we have seen so far have been nothing but preparation for the massive collapse due in the week/weeks ahead of us. There is only one way to know for sure: If the indexes rise above the equivalent of 5200-5400 then my new analysis is definitely wrong. If this first set of declines is indeed over then as you have said we are about to see another explosive rally in the days ahead which as wave C of the corrective advance would be expected to have the same length as wave A and would therefore target 5650. Therefore the markets are about to move very quickly either way so if I am wrong we will know very very soon indeed.

I had drawn up a chart to project what I expected to unfold over the coming months, and my targets for the FTSE 100 were 3000-3500 for wave 3 and 2500-3000 for wave 5.

Anyway so far so good (well..for my forecast anyway), and I couldn't agree more with you that 'if wave theory tells me that we're on the cusp of a 50% decline in the S&P and that I can place a bet on that decline with, let's say, a 10-15 point stop-loss, that gives me a 30-50 to 1 risk-reward ratio. That one trade could make a man's life do a 180 degree turn, at least financially', as over the following month or two I made returns of 10,000%, albeit with the large use of margin, in the process changing my own financial situation from being stony broke to extremely secure. If I'd had more experience I would have posted a warning publicly but I'd only just started trading early last year. Baptism of bloody fire! Mind you it was a lot better financially than when I bought into buy-and-hold investing back in...you guessed it, the second half of 07.

Incidentally, when wave 4 came I gave the majority of my returns back, making a personal discovery in the process: I hate sideways markets ;) Buy and they go down, sell and they go up, cut losses and they will immediately reverse back in your favour, run losses and risk losing everything. How does it bloody know!!! I'm actually posting this paragraph for the benefit of anyone who hasn't had a lot of success with sideways markets, because I want to say that I found my savior over at Elliott Fractals - Hank's a genius, worth the subscription fees ten times over :)

min

Well I took the NDX shortly after market close. It's a small position with a bit of the profits from the recently closed long, so we'll see what happens...

DG

Wavist,

That's a great story and congratulations on your successes! If this next year turns out like I think it will, there will be some great volatility up and down (first down to new lows, then up to retest the levels we're at now, then down to new and perhaps final lows, then up in a new bull) and taking positions on each turn with little initial risk would turn out to be very lucrative. Four trades that each show 250 to 500 S&P point potential, in a year that might end up going nowhere on the headline index numbers. Now that's a trading environment!

Wave Rust

is the 4th over yet? i thought it would have to be a 'forever 4th'. i don't think it is over. it just keeps extending out in time and frustrating bulls, bears and the scared. good signs of a 4th.

when its finally done, i think it will look like a contracting wrapped inside an expanding. that will have to have a bump of somewhere near sp1100 then down to 840+ for the 5.

an excellent way to tell whether the 4th is over is if you just finished your third 'dam, what an idiot i am for taking that trade'. your patience can't be found. and, you begin to hate things you have always loved,,, like your dog or mint chocolate chip ice cream.

maybe you are muttering all of the "it's gotta do this or that" phrases.

just sit down and forget about trading. go play something you haven't played since you were a child. like 'chutes and ladders'. because elliott wave is just 'chutes and ladders' for groanups.

;)

happy new year

wave rust

p.s.
my prediction for 2009=

no more crashes. just a soft landing for the markets since they are all in the cargo net, hanging beneath Ben's helicopter.

Hank Wernicki

Monday's Trade Setup: 1/12/09

Bullish Attraction Point to go Long


http://www.elliottfractals.com/DIA_1_9_09.jpg

Hank Wernicki

Monday's Trade Setup: 1/12/09

Bullish Attraction Point to go Long


http://www.elliottfractals.com/DIA_1_9_09.jpg


Adrian Nevo

Hank, I see you were watching 1244 and 1232 on NDX as lines in the sand for the upside and downside respectively for Thursday (Jan 8th). We broke 1232, but also 1244 (and neither by a negligible about). Reading your analysis, this implies both a confirmed fractal to the downside, and not.

How have your views changed since then, since it's quite obvious market action didn't follow as expected?

Min

Lowered stop on my NDX short to lock in some quick profits. No matter what happens on Monday I'm a happy camper.

DG

Monday's Trade Setup: 1/12/09

Bullish Attraction Point to go Long


http://www.elliottfractals.com/DIA_1_9_09.jpg


Posted by: Hank Wernicki | Friday, January 09, 2009 at 05:31 PM

I'm sorry, but it seems a little too convenient that the relevant fractals can fit on one relatively short-term chart. Elliott requires that "standard" patterns repeat on multiple time frames, but it also implies that the repetition of those standard patterns not be so close in time, when the patterns are of the same degree.

saahilcap

Hank you just posted last week that we were going to new lows..this makes no sense..

Wavist

Thanks DG and yes there certainly are some huge trading opportunities ahead this year, although as we move towards the bottom it's going to get a lot more tricky. I'm inclined to agree with wave rust that wave 4 is still in operation, the market just seems too optimistic for the current declines to be a fifth wave, which by definition is the speculative extension to the overall decline caused by participants panicking. We're more likely to still be stuck in either wave b or 2 of c of 4. What I don't get is why Neely keeps changing the start of the bear market to a succession of increasingly unlikely dates requiring such a bizarre count when if you just start from the actual high it fits perfectly into a beautiful five wave movement. It's not just a question of numbers either, as it requires him to count the recent correction as an illogical x wave disturbance rather than the 4th wave that you do if your wave universe is more flexible. This in turn means a significantly lower bottom anticipated now for the markets at SPX 475 (down from the previous target of 600 from the public release 10/10) under Neowave than would be likely under the pure wave count which would anticipate a truncation following such an extended third wave - as was the case with the fifth waves to both waves 1 and 3, and for that matter 1 of 3 of 3. Actually if my forecast from last year ends up correct trading the coming decline is going to be a hell of a lot more treacherous than if we're completing an x wave half way through the decline as per Neely's analysis.

Incidentally EWI's flash alerts recommended selling the SPX at the market early Friday.

DG

Wavist,

All I can really say is that if you don't think Neely's "Essential Construction Rules" for impulse class waves are necessary, then you can count the move from the 2008 high as an impulse. If you do believe they are necessary, then you have to find a corrective count to fit the move, hence his count.

Secondarily, if you believe that his "Post-Constructive Rules of Logic" are necessary, you might have to move the end of the bull market to his later date because that was the start of the "largest, fastest" correction of the bull market. At least there's the potential to have to do that, although on the other hand his structure from the beginning of 2008 (an expanding triangle) does allow for wave E to be the largest and fastest move, without coming at the beginning of the turn from bull to bear market.

Those are the two inputs that drive NeoWave wave counts, so the question is whether those inputs make sense "as is" or if we need to be "flexible", which is actually the last thing Neely's method is. "Flexibility" too easily becomes justification for bias, in my experience.

I'm not sure why you'd characterize his x-wave as "illogical", though.

Also, your read on sentiment as "too optimistic" is a bit subjective, but even there I don't see any reason why optimism in levels seen today necessarily would be a reason to override the NeoWave rules, which are strictly price driven.

Simply put, if his rules are right and he's following his rules, his count is right, at least in broad strokes. That's how I play it, anyway.

Wavist

Well explained. And as we are fortunate enough to have the world's second Neowave analyst here I'm wondering if you have a view on the market that's missing from his four - oil, as I can't seem to get him interested in adding a fifth service and following EWIs forecast last year for a near doubling in the price of gas I find myself unwilling to pay their energy man too much attention.

Hank Wernicki

Most posts are for day trades <<<<

Trends change

Hank Wernicki

Thursday (Jan 8th). was a wash for a day trade ....

Hank Wernicki


Note a Pattern is Static described through traditional geometry created a long time ago

Observe the sky , and you'll notice there are No angles squares circle lines etc

A Fractal is Dynamic and represents the true picture as it changes and as it should

One can't confuse the two

TObject

"No angles squares circle lines etc "
Hank, r u talking about non-Euclidean geometry? ;-))

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