Friday, March 20, 2009

Friday part III

A continuation of the previous two posts, exemplifying of how all of this came together, the charts, channels, wave counts, Blue Wave and now FBS Trend appearing on the 15 minute charts.



David said...

I assume the bigger picture is still the same? The 240 min chart posted on Wednesday had us finishing w3 of 1 up and heading into w4 down, with an est target of 750-760. So there should be a larger w5 up still to come, if we assume this count is correct.

Anonymous said...

Alan is it correct to say that bluewave will always get you into the trend but at the cost of several small losses? I see on the chart two sell signals that got chopped a bit prior to the last sell signal.


Allan said...

David: Five waves down from the 2007 highs may be complete, which would allow for a summer rally in Primary Wave 2. What happens to this decline will tell that tale, either new lows (Wave 5 not yet complete) or new highs above Wednesday's highs (Summer rally in Primary Wave 2).

Bill: There is a trade-off with Blue Wave, shorter time periods have choppy periods, but small drawdowns, where larger time periods have fewer whipsaws, but some healthy drawdowns. Just fit your trading style to the appropriate parameters and run with it. Either way, profits flow.

Anonymous said...

I agree with Alan's comment above. I suspect we'll make a new low because looking at the Dow chart from the 9088 high or the start of intermediate 5, I can't count 5 internal waves down.

The county is confusing to say the least.

I suspect we have started b of 4 of intermediate 5 of primary 1.

I have to question the count on the 15 minute chart, which has the top of 4 above the bottom of 1.

To me, the decline looks like a corrective wave of some sort, more like an a-b-c.


Anonymous said...

Alex, can you put it in a way that we can understand, like we are going to decline to the SPX 600 area or something like that ...

Jack said...


Is it possible to post a long term chart again with all the wave labels marked (primary waves and intermediate waves)starting in 2007.

It's very helpful to review the 'big picture' with all the major wave counts.

Thanks, Jack

Anonymous said...

allan, any thoughts about financials for monday? fas vs faz given news on toxic assests?

Anonymous said...

To put it in a way to understand... OK I'll try.

The count is unclear here. Either the market made the low for the year and we are beginning primary 2 up that will push the Dow to 10 to 11,000.

Or the Dow is going to make one more low, finish wave 5 of primary 1, and then it is going to rally to 10 to 11,000.

Myself, my hunch is we'll make that one more low below the March 9 low of 6489. That will complete primary 1.

Either way, the odds/ expected value is for higher prices the next 6 months.

I'm a long-term investor, looking to put about 30% of my 401k money back to work in this area.

I put about 5% of my 401k in an S&P mutual fund on Friday's close. That's the first time I've owned the market since May of 2007. I'll probably put another 12% in at the 61.8% retracement of this rally off the low (around 6889) and I'll buy another 12% of at the March low of 6489.

If the market drops to a new low, about 30% of my 401k will be in stocks with an average cost of about 6600. If the market doesn't pull back and just takes off, I'll be in somewhat.

I'm also looking to put some of my 401k to work in a commodity fund too (DJ-AIG).

I think you need to be hedged. In the short run I think we'll have more deflation/ disinflation. In the long run we will have inflation.

How long it take to go from deflation to inflation will depend on how quickly confidence comes back and people start spending all this money sloshing around in the system.


Anonymous said...

thanks, Alex ...

Anonymous said...

Yes, thanks Alex, and Allan always..
I like to hear what people are actually doing, rather than what the charts are saying since anyone can venture an opinion. Its only when i see that they are acting upon their opinion that i tend to listen more. I am a little confused here since i'm thinking Allan is getting less bearish but I'm long 30% so i guess my opinion fwiw is reflected in that.