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« Krugman in Wonderland UPDATED | Main | A Slight Excursion into Ending Diagonals and Other Terminal Patterns »

Monday, March 08, 2010


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I nearly capitulated on Friday, when this happens the market usually tops within a week. Yesterday's doji is however giving me hope.
Have stops in place if they are hit the bears will lose the battle but the war is far from over.
Risk management is the key to make sure you have ammo for when this global rally collapses. It is going to be sad that so many bears will be out of cash for when these markets finally top and will only be able to watch from the sidelines.
Don't be one of them!!!


Change the 2 to a B and Kenny and I are on the same cloud.

You discovered it Yelnick.


vipul garg

since the count is totally flawed market should ideally move beyond the outside limit mentioned.
and even if the market goes down it will not be because of this count being in effect!
what he is trying to build nested ending diagnols where each wave of c say wave 1 is itself an ending diagonal!


Due respect - it is probaly going to kiss that top- and that should be it.

This guy is probably pretty close.



Joe, where then is the ultimate bottom? And when?



Don't know - I doubt we hit it yet though. It is much deeper than this - and I think lower than the 3/09 lows.

We get to find out in about 7 months.



Your analysis is good Yelnik- you need to trust yourself more - Your math is strong - and I know you want to show other points of view - but damn - do you really want to go this far??

If the thing is going to kiss its own ass - what more do you need to say - more than that??

Best to you - I think you make honest arguments.



Joe, if the count shown today is it, except the 2 is a B ......

We bottom in 2011, probably 1st half ...

at Dow ~ 2900.

Take it too the bank.

Watch oil and commodities here. I think they lead down, and bottom LT first.

Then the rocket launches, and really blows Prechter and Neely out of the water, as if that comes to pass they will at the bottom be howling about how right they were and really preaching the blues.

Gotta love it man.




Oh, and if ya'alls think I'm nuts, I probably am.

But I think we are still in a ST to IT correction within a secular bull. I have heard/seen very little from Yelnick the bear about 'degree'. Neely and Prechter vary little in their current views, as both have this as a correction of major degree. Prechter perhaps more major than Neely, but both are in major degee corrections.

Now ask yourself, how right have they been over the last several months?

Not very to say the least. Two big DUDS.

So what are the chances of both being correct as to the degree of correction we are in? Very low. Extremely low as a matter of fact.

So what if this correct is of minor degree? Every 5 wave pattern at some point has a major correction. A correction of minor degree can go deep, very deep, but in the greater scheme of things takes much less time than a major degree correction, and is followed by a rocket launch.

I then suggest we could be in the middle of a correction of minor degree, within a 5 wave impulse up. If this is correct, the bottom of this correction will be the buy of all time, the rocket will launch, and we will see a rebound not to a another double top or whatever, but to new highs and beyond. And commodities will lead the charge, as the whole world synchronizes within a global build cycle.

Look to the Naz man ... that chart is very ST bearish, but is getting LT bullish by the day. When the Naz bottoms it will be a bottom for eons, and it is getting closer in time. Corrections off a big top only last so long, then viola, an upwave that knocks the socks off takes hold. Take it to the bank? Time will show.



Yelnick -

leg 3: 1029 - 1150

leg 5: 1045 > 1166



The G-Team is perhaps trying to be a little more discreet in this ramp job. On the run from March, I read that 80% of the increases were ramped on the weekends. This last little bear crushing run up was created 63% by futures and gaps up. Gaps are way more prevalent than they used to be. Blame it on the G-Team or on Globalization?

See table below and convince yourself


FTSE seems to be impulsing down this morning, so ... could this be it???


Vipal Garg wrote: "since the count is totally flawed ..."

Sorry there Vipal, but not a single EWT rule is broken, so you have no idea what you are talking about. You must be a PUGridiron follower. But you stay long.

BTW, check out Elizabeth Warren on Charlie Rose. She says the oversight agencies are merely running cover for Wall Street, MASSIVE banks failure is coming, and the government is afraid to tell the people that this is a manufactured balloon.

Kudos to Kenny!


Yelnick & Ken, thank you. Interesting observation. I'm equally clueless about the medium-term count. But in the short-term, i'm counting this rise as a W-X-Y (all 3-wavers so far), and have a target of 1153spx, followed by a significant reversal. Here's the post:

vipul garg

ignorant as i am, i had not heard of PUGwhatever, so i had to google and check him. i would not really follow this person for his application of EWT.

in my above comment i had some idea what i was saying and i will happily admit it is easier to debug/criticise .but still i cudnt resist .
however since you say not a single rule, i will just say a few and maybe rest you can figure out:
i hope we understand what the implications of ending diagonal are , else it s futile effort.
wave A in red is corrective, so it cannot be a zig zag.
now lets discount that wave A in red was impulsive since it is not marked in the above chart,
wave 4 in blue is larger than wave B in red which as a smaller degree wave it shouldnt be .
wave 1 in blue is shown as an ending diagonal but wave 2 retraces not much of it cannot be ending diagonal . all subwaves of wave c of 1 in blue are larger than wave b of 1, which again is not possible.
and so on.
and believe me , though i belong to neowave camp, i havenot even begun mentioning problems if we apply neowave rules.



How do you feel about this expanding affair?



Take a look at EEM when you have the chance. This is what lead off the March lows. It took out its November lows in a 5 wave impulse from January and appears to have completed a zig zag up.

This would be a candidate for short with a tight stop. At least a good one to hedge long positions.


got around to doing a euro/usd update for those interested...



I agree with vipul regarding the likelihood of this being "the count". The market may turn down here. Short-term short trades from new rally highs have been a very high-percentage play, but have, obviously, lacked follow through. Short any new high, wait for the inevitable reaction, aggressively move your stop to breakeven and let the market do whatever it is going to do.


Nice Yelnick!

Kenny is the man. I visit his blog daily, and he's a master Elliotwaver. His insights are amazing, and he is often the first to make a correct call on EWT.


And a great big thanks to "WAGS" for bringing this count to Yelnick's attention!


I perused the sidelines of Kenny's blog. I saw two things very interesting. One was about radical Islam and Asian markets. I happen to think the radicals are losing, and the wavists apparently predict the same. But they ain't going down easy.

The other was a quote about gold by Bob Prechter. I give Bob credit for this. I think he has this 100 % correct.

In Bob Prechter's own words:

"All huge gains in gold have come while the economy was expanding… The idea that gold reliably rises during recessions and depressions is wrong. In fact, like most such passionately accepted lore, it's backwards."

Following a bottom within the next 16 months, gold and miners should literally explode, up with the rest of the indices.



Chris - right! 1166. Thanks for correcting my math.

Mamma Boom Boom

It's the 'Odie Syndrome': who's my friend today?


After being lucky enough to pick up a few emini's pre market this morning at 1133 as a hedge against my monster decaying put position, I'm thinking I'll set my sell target on the emini's a tick or two above Neelys new stop....No doubt in my mind will he get stopped out...His stop from the new short yesterday is 1145.25...Come on Neely, don't let me down! His stops are like magnets I've found....


Neely about to get stopped out again???

What a surprise!


Yep, its official. Neely stopped out....again....Sold my long eminis at 1145.25, hopefully to Glenn himself!


The current up leg in the Nasdaq has gained ~ 150 points in the last 8.5 days. Also, since the bottom (5 FEB), the first leg up was ~ 150 points in 9.5 days.



"If the thing is going to kiss its own ass"


I'd like to use this when I'm out buying some slob a dishwasher in the next few months. Might substitute the word lick.

Hockthefarm will buy you a dishwasher if you can lick your own ass.

I wonder if I could help my country more by substituting a trip to Hawaii for the dishwasher. I'd like to see the math on that.


da bear

also, the Nasdaq topped in the first couple of weeks of March in 2000.
Since this should be a wave three down then everyone should know where the main trend is going (DOWN DOWN DOWN).

da bear

Ask your local bank teller about change.


there was an interesting bar and candlestick configuration at today's high. this showed up on 5, 10 and 15 minute charts. the one hour chart was a 9-13 combo using Demarks method. curious formations but i couldn't backtest because of short term chart limitations. i enjoy the comments here.

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