Wednesday, January 14, 2009

Down, down, down



Here is an updated Weekly S&P chart, including Wednesday's dive as well as the extension lower due to the sad but market moving news about Steve Jobs. I've added a potential support level that was automatically generated by my software, based on typical lengths of waves under the Elliott Wave Principle. Yes, that says 700 on the S&P 500.

Now for the bad news:




Above is the Daily S&P chart with an added first support projection indicated to be about 650. Worse yet, the minimum projection for the end of this five-wave decline is indicated to be just below the 600 level.

One more, if you can stand it:



This is the Sixty minute chart, showing the shorter-term waves division. Consistent with the Daily and Weekly charts, this shorter term snapshot shows how the larger waves in the above charts are breaking down in a fractal of the major count and how since breaking the bottom of the Wave 4 channel shown in the other charts, that prices have been accelerating down.

Sigh.......

A

12 comments:

Michael Lomker said...

I'm using the daily chart projections. Lots of money to made in the next few months to the short side.

ROB G said...

ALLAN YOU HAVE BEEN RIGHT ON THE MONEY. IM NOT SHORT , JUST SITTING IN CASH, LET US KNOW WHEN ITS TIME TO NIBBLE

Allan said...

Rob: when the time is right, there will be no nibbling, more like wolfing down a feast of cheap, cheap, cheap stocks for a breathtaking Wave 2 rally retracing 1/3 to 2/3 of this entire declineffrom the 2007 highs....but we're not there yet, not even close.

A

ZenDog said...

Allan, I bought TGB @ $1.11. Should I sell???

Allan said...

ZenDog: I don't know, what do you think?

Anonymous said...

ZenDog, I think you just got hosed....

newbie

Marmaduke Weatherall, IV said...

Allan:

Are we looking at market meltdown?

Or just a 10-20 point SPX retracement. I don't get excited about 20 SPX points.

MW

ZenDog said...

Yeah, I get it now...P&D.

Anonymous said...

Wave counts to me are secondary. The count is clear in the short-term, but not very clear to me since the high.

Either way, this feels like a 5-wave down of some degree. I suspect this market is going to drop to just below the Nov low.

My Dow target is 6800 to 7187. Given the near 10 to 1 ratio, that should put the S&P below 700. I agree with you Alan on that, but suspect, we'll see a good sized rally after that.

Alex

Anonymous said...

What came first? The EW or all the bad news timed perfectly with EW projections? Pretty soon, everyone here will be claiming that EW patterns to predict when good and bad news are due. LOL!

horace

Marmaduke Weatherall, IV said...

Horace:

This log is about ALLAN not some system. We need the man and not the machine.

His charts and programs are good, but is is ALLAN and ONLY ALLAN who brings them to life and makes hem sing.

Hence the title "Allallan."

MW (old money)

Michael Lomker said...

>everyone here will be claiming that EW patterns to predict when good and bad news are due

It does, I've turned it into a game trying to guess what the media is going to blame perfectly predictable market movements on. If you are curious then you could read one of Prechter's books on Socionomics for a detailed study.

We are going to have a wave 2 up next week and then a major crash to the November lows at the end of the month.

Obama's inauguration will get the credit for the move up and the move down? I have no idea. The media will ascribe a cause.