Friday, May 14, 2010

DJIA - Weekly Trend Model

DJIA Weekly Trend Model w/EW

The Weekly DJIA highlights just how far this next wave down has to go, if it indeed is a 5th wave to complete the suggested EW pattern.  Robert Prechter would suggest hat this EW count is wrong, that in fact the DJIA is entering into a Wave 3 down, not a Wave 5 down.  So of these two counts, the one above is suggesting only a drop to below 7,000 to complete five waves, where Prechter is suggesting a drop much, much lower, below 1,000 before we start looking for a completed EW pattern.  

The bulls, on the other hand, are again suggesting that this is just another buying opportunity.  Go figure. 



pimaCanyon said...

And yet another EW count is that the move down to the March 2009 low completed an ABC and a new bull market began at that low.

And yet one more count is that the Mar 09 was wave A of an unfolding 4th wave triangle, wave B has been running since March 09 and will play out as a big zigzag, maybe the top of the zig just completed, we now go down to 900 or so SPX then zag back up to a new high to complete wave B of the triangle....

So many counts, so little time.

Will the real count please stand up!

The answer of course is to say "pick a count, any count" and just use your trend following system instead.

Allan said...

The beauty of the trend models, they care not about wave counts, only for the moment.

Anonymous said...

Bob Prechter will always deserve respect for what he's accomplished,and nobody can take it away from him.


he's been somehow,for some illogical,irrational,un-elliott-like reason

wrong in all his forecasts since the first major one he presented on August 3 2009 at that top in the market,he made his wave 3 crash alert.

It deserves examination.

What could possibly account for such grave error?
Is it incorrect elliott wave analysis?

No. his wave counting is perfect.

but it turned out wrong.

What could account for it then?

enter another theory.
The Rigged Game Theory.

In Las Vegas, the slot machines are exciting looking, lots of bells and whistles and flashing neon lights on the outside.

and a computer system on the inside which is precisely calibrated and programmed to Pay Out at a rate of 35 %.

Its a Rigged Game.
Counting cards in black jack is a rigged game mathematically, and because it favors the player by 51% to 49%,the casino outlaws it.

The global stock markets are a rigged game. Its really that simple.

There is a wizard behind the curtain.

There are monograph initials printed into the curtain. they say GS and FED.whatever that means.

People like Zero Hedge talk about it. whats so hard to see?
its right in front of our eyes.

The Theory to study in this era of the 'new normal' is not elliott wave theory alone, but combine it with the Rigged Game Theory.
there is a time where one theory dominates over the other and visa versa.

when you see that one is 'not working' look to see if the other one is.

I would venture a guess that right now,for the last few weeks, its the rigged game theory that is at work.
It accounts for the bizarre plunge and recovery on may 6 .
and if it is at work now, there ought to be a super stick save today sometime next week,and a run back up to 1200-1250 .or at least a steadying base building at the 1150-1170-1180 zone.

what current elliott wave structure suggests right now,on a short time frame chart,is that market will hold here,finish the day with an upsurge,that targets 1150...followed by a correction that holds at 1138 support,followed by continued long to target 1180 and 1200.

I could be completely wrong. just like Prechter.

Anonymous said...

A reliable trend model is a great tool,if it works consistently.

Anonymous said...

Right now,is when and where the stick save needs to happen.

Anonymous said...

mental health for EWave schizoids.

pimaCanyon said...

I don't buy the rigged game theory. The Fed, the banks, the market makers--they are ALL part of the social fabric that EW talks about. The Fed doesn't control the markets anymore than the banks or the market makers. The market is too big for that.

I believe the problem with Prechter's analysis is that he has a bearish bias. He has been bearish since the early 90's. As a result, his timing is usuall off. For example, second waves usually retrace first waves by either 50 percent or 62 percent. Why, then, was Prechter forecasting the end of the second wave with only a 38 percent retracement? Why was he so sure it was done at 50 percent, knowing that 62 percent is a very common retracement amount? Bearish bias, that's why.

There are several other wave counts that could be in play here and he doesn't even show them as possibilities in his forecasts? Why? Bearish bias. No, that's not quite correct. UBER-bearish bias. He doesn't even consider the alternate bearish counts that are not as bearish as his count.

He could turn out to be right about his count, but with so many other counts out there as valid possiblities, the odds are against him. Even if he does turn out to be right, his timing sucks! Go short since the early 90's!! Go short and stay short in the late 90's and completely miss the 2003 - 2007 bull market! What good is a forecast if you can't use it to profit from it??

khalid said...

Holy Crap!

Anonymous said...

Been there and burn by Pretchner's call. The thing with EW is that there are often possible/probably alternate counts. EWI got in trouble in that they were fixed on one count until they were proven wrong.

TA is a very useful tool to compliment EW,or the other way around.

We have had so many miserable econ data, issues, debts, etc. But, the bulls sidestepped all that with one lame execuse or the other. "The subprime is contained." ... The thing is unless FED tighten the money supply, or the debt is written down, this thing is going up to the sky.

tapped out said...

Khalid, Thanks for the link to the holiest of astonishing holy crap wonder. Wow!

Anonymous said...

interesting read..............

Anonymous said...

Hmmm....The Wizard of GSFED.....

It is in control!!!