Monday, January 12, 2009
Elliott analysis update
The above Weekly chart shows a clear break of the ten week long wedge that appears to be a completed Wave 4. This is a good time to remember that anything can happen in the markets and be explained away in retrospect. Nonetheless, if it looks like a break-down, acts like a break-down and feels like a break-down, it's probably going a lot lower.
Here is a closer look with the Daily S&P 500:
This is an almost perfectly formed and complete Wave 4 with a break of the channel lines drawn from the November lows.
Finally, below is our leading shorter-term chart, the 60 minute chart, which correctly gave us a heads up last Friday with a clear break-down warning that a new leg down had begun:
My analysis tonight is purposely succinct, not just because it's been a long day and the Red Wings lost to the Dallas Stars in overtime, but because sometimes less is best. Let's not make this Elliott Wave stuff any more involved then necessary. We are still due another leg down to complete the first phase of a multi-year bear market and as of tonight, the most apparent chart action is suggesting that Wave 5 down has begun.