Once in a while the markets trace out a structure early which tells us with high probability what's unfolding in the bigger picture. This is that time. Above is a 15min S&P cash chart showing a clearly corrective rally that started on Friday. You can see an indisputable 3 wave rally off the 817 low. Then the market declined beneath the previous low in the 833 area. This makes it impossible for a series of 1's and 2's to be unfolding and some type of impulsive 5 wave rally to occur. It is clearly corrective. Getting this data so early in a market move is so valuable. This instills great confidence that the market will make at least a new low beneath 817. So in my opinion, I now want the market to rally strong and high, because it will allow me to short bigger and at better positions as it does so, therefore making me more money. As long as the market trades above the 817 low, it's a correction and I'll be shorting it.
I see this coming rally and ensuing 3rd wave decline as a great opportunity for us ellioticians to make some big profits in the coming weeks. This should be the best setup for us since we made a killing predicting the crash in early October. The setup is coming....
8 comments:
Here is my newbie prediction. I think everyone is expecting a rally when Obama gets into office. But the market tend to go the opposite of what other thinks, so if everyone is expecting a rally, then I think the market will drop half way through the week and then rally. What do you think Todd?
http://i270.photobucket.com/albums/jj112/kimmichaelp/Mike1.jpg
http://i270.photobucket.com/albums/jj112/kimmichaelp/Mike1.jpg
http://i270.photobucket.com/albums/jj112/kimmichaelp/Mike1-1.jpg
Sorry for lots of post.
http://i270.photobucket.com/albums/jj112/kimmichaelp/Mike1-2.jpg
Just by looking at this chart, I realize I could have figure out the 3 parallel line on 1/02.
Good point. The Obama rally occuring does seem to have a consensus across the board. We're in a correction, and the larger trend is still down, so small nuances of the corrective rally are hard to predict. But it can easily do what you said. But whatever the structure, it should ultimately float higher in the coming days/weeks.
What time frame are you using on your charts? A strong break and close beneath the ascending trendline at the bottom may indicate the correction is over and the next decline phase is underway. The more tests of that trendline and the larger the time frame, the more reliable the trendline becomes. And therefore a strong break and close beneath it should signal the downtrend has resumed.
http://i270.photobucket.com/albums/jj112/kimmichaelp/Mike1-3.jpg
I am using a 2 month time frame, from 11/17 - 1/17. I don't know what I am doing, but its fun drawing line. :)
Todd, did we just finish wave 1 of 5?
wave 2 of 5 should take us to 890?
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