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Posted by snowrider on 01-01-12 07:04 PM:

Perfect Wave - 2012-1/2

I am starting a new thread for 2012's first half year (Jan - Jun), including EUR, SP, Gold, and JPY. My previous wave counts can be found from:
http://www.elitetrader.com/vb/showt...threadid=228108

Elliott Wave reference can be found from:
http://en.wikipedia.org/wiki/Elliott_wave_principle

My labeling for wave degrees in different time frames:
Monthly - [[[I]]], [[[II]]], [[[III]]], [[[IV]]], [[[V]]], [[[A]]], [[[B]]], [[[C]]]
Monthly - [[I]], [[II]], [[III]], [[IV]], [[V]], [[A]], [[B]], [[C]]
Weekly - [I], [II], [III], [IV], [V], [A], [B], [C]
Weekly - I, II, III, IV, V, A, B, C
Daily - 1, 2, 3, 4, 5, a, b, c
Daily - _1, _2, _3, _4, _5, _a, _b, _c
Hourly - __1, __2, __3, __4, __5, __a, __b, __c

My labeling for wave formation in a segment = Wave Name + Wave Formation
For example, [A3] = 3 segments in a wave [A]
For example, [A3][B3][C5] = 3-3-5 formation for waves [A][B][C]

My labeling for zigzag is the combination of R.N. Elliott's classical labeling and my wave formation labeling. DO NOT USE R.P.'s W-X-Y(-X-Z) labeling because it creates confusion and lacks the flexibility of changing wave counts.

I am getting lazy on updating the counts because I don't know how many people are following. I might stop writing this at anytime. If you are an audience of my threds, please PM me to let me know so that I won't forget to keep you updated if I stop writing.

__________________
- Not a bull, not a bear, I am just a wolf ...
- I know how to deal with Support & Resistance, for my initials are SR ...
- If I say red, it means up; also, if I say black or green, it means down!

Posted by snowrider on 01-01-12 07:32 PM:

01/01/2012 Monthly Charts

Comments are welcome!

Posted by snowrider on 01-01-12 08:15 PM:

I just noticed that I had a typo in gold's month chart.

The final target of gold's super bull market could be $1,960. The extension wave [[[V]]].[[IX]] should be labelled as [[[V]]].[[E]].[IX].

Posted by snowrider on 01-02-12 03:08 AM:

01/01/2012 SP Monthly Chart Again

An alternative count:

[[[A]]].[[C]] becomes [[[[IV]]]]
[[[B]]] becomes [[[[V]]]]
[[[C]]].[[C]] becomes [[[A]]]
[[[D]]].[[C]] becomes [[[B]]]
If this is the scenario, we are in [[[C]]] now, and it could go to 550-650 when it finishes.

Posted by snowrider on 01-02-12 03:49 AM:

Waves [[[A]]]-[[[B]]]-[[[C]]] are not 3-3-5. [[[A]]] is definitely a 3. [[[C]]] is highly possible a 3 too. [[[B]]] could be a 3 or a 5 depending on how we see it.

[[[D]]] and [[[E]]] are part of [[[[IV]]]], where the assumption is that they are in a wave-4's abcde triangle. (See above chart.)

The purple line has the assumption that [[[A]]]-[[[B]]]-[[[C]]]-[[[D]]] have completed, and now we are in [[[E]]] to form [[[[IV]]]]. An alternative count is that [[[A]]]-[[[B]]]-[[[C]]] has completed the [[[[IV]]]], and we are in the early stage of [[[[V]]]].

Posted by snowrider on 01-02-12 03:56 AM:

where does your count put the highs in on the sp? i reckon we are going to 1330 ish before trading down into the summer making a decent bounce into end of year

Rothschild - I would guess that SP spot index 1320 area could be where the reversal starts. We need to pay attention if SP ever moves to that area to see if there is any sign of exhaustion.

Posted by snowrider on 01-08-12 05:54 AM:

01/08/2012

Comments are welcome!

Posted by jas_in_hbca on 01-09-12 07:44 PM:

Long term EW count question.

Could 1987 be a end of wave 1, (approx) 2000 end of wave 3,
2008 end of wave 5 ?

If so, then could 2009 bottom be wave A , 2011 top end of a 'B' ?
and where would a projected wave C end ?

Thanks !

Posted by snowrider on 01-10-12 01:13 AM:

Quote from jas_in_hbca:

Long term EW count question.

Could 1987 be a end of wave 1, (approx) 2000 end of wave 3,
2008 end of wave 5 ?

If so, then could 2009 bottom be wave A , 2011 top end of a 'B' ?
and where would a projected wave C end ?

Thanks !

jas_in_hbca - It could be. As I believe and mention many times that anything is possible.
With that scenario, we are going to enter a long term bear market soon.
That bear market could have 2.5 more years to go, and it's final destination of the bear movement will be after falling below 2009's low.

Posted by snowrider on 01-14-12 02:57 AM:

01/14/2012

Comments are welcome!

Posted by jas_in_hbca on 01-20-12 04:20 PM:

Snow,

NQ 5 minute attached. (Not sure how to attach pic so it autmatically views)

Any thoughts ? thanks

Posted by jas_in_hbca on 01-20-12 06:45 PM:

update . needs to turn down soon.

Hope you don't mind me posting here. If you prefer i'll post these in my journal. I'm not planning on doing this often

Posted by jas_in_hbca on 01-20-12 09:42 PM:

Last post.

It did turn down as expected but didn't make it to target.
Still a chance it could make it to 2410 next week, imo, but not as confident now.

Thanks snowrider for letting me hijack your thread. I'll go back to lurking here.

Posted by snowrider on 01-21-12 05:20 AM:

Quote from jas_in_hbca:

Last post.

It did turn down as expected but didn't make it to target.
Still a chance it could make it to 2410 next week, imo, but not as confident now.

Thanks snowrider for letting me hijack your thread. I'll go back to lurking here.

jas_in_hbca - You are welcome to post here. I did not check this thread today until now. Let me post my weekly counts first in my post. I'll find a time later on weekend to review your counts. (I'll go skiing next two days, so I won't check until I am back home.)

Posted by snowrider on 01-21-12 05:23 AM:

01/21/2012

Comments are welcome!

Posted by jas_in_hbca on 01-23-12 06:40 PM:

Thanks Snowrider !

Looking at the waves while waiting for a trade

just 1 for today. let's see if this plays out . haven't looked for a target yet

Posted by snowrider on 01-24-12 04:11 AM:

Quote from jas_in_hbca:

Thanks Snowrider !

Looking at the waves while waiting for a trade

just 1 for today. let's see if this plays out . haven't looked for a target yet

jas_in_hbca - I took a look at your posts. All make sense to me! This one is especially good! It could be a higher degree wave-c or wave-3 going down now.

Posted by snowrider on 01-24-12 04:23 AM:

i agree with your projections on gold, but im not sure your wavecounts match mine. i like to keep it simple, so i only use waves 1-5 and then abc.
...

nim1984- Thanks for commenting and sharing your thought. Yes, I like your idea of keeping it simple. That is also one of the reasons that I don't agree RP's wave counts most of the time.

...
i think wave 5 of wave A was over at 1522, assuming 1920 was end of wave 3. right now we're in wave B which could go as high as 1760 area. then wave c will break to new lows...maybe mid 1300's?

then we'll have the last wave 5 which will take out the high of 1920, but dont have a projection for it.

note: i'm not an elliott wave junkie. i did this analysis in 10mins looking at monthly chart, just to get a feel for where we are right now in the cycle.

Your scenario is quite possible. In that case, this big ABC correction is in the same degee as that of 2008 one. For now, no matter whether we are in a big ABCDE or a big ABC, the medium long term's momentum is heading up.

Posted by snowrider on 01-29-12 03:58 AM:

01/28/2012

Comments are welcome!

Posted by snowrider on 01-30-12 03:34 AM:

for gold, you're saying that the c wave might have ended. you have wave a from 1522-1662, b wave from 1662-1625, and c wave from 1625-1738.

however your c wave is only 113 pts long, compared to wave a's length of 140.

c waves are often longer than a waves, going upto 1.618 times wave a, so why do you think c wave will be truncated this time?

nim1984 - Good point! We don't know if wave-c has finished yet. That was just my guess because GCG12 is rolling over to GCJ12 now. Sometimes a reversal occurs around futures contracts' rollover dates.

Posted by snowrider on 02-05-12 02:42 AM:

02/04/2012

Comments are welcome!

P.S., I'll be out of town next whole week and won't be able to reply to any PM or comments.

Posted by snowrider on 02-12-12 08:03 PM:

02/12/2012

Comments are welcome!

Posted by snowrider on 02-13-12 05:20 AM:

1) if SPX goes to 1370 first before C5 formed, the C5 will equal C3, or may be great than C3, right ? but we know C5 can't be great than C3 according Wave Theory. How can we explain this?

C.3 = 84 (1333-1249)
C.5 could be: 1300+84=1384 if C.3=C.5
C.5 could be longer than C.3 (as long as C.3 is not the shortest was in C)

2) If C5 is really formed at 1370, the Fib 61.5% pull back target should be great than 50 point, right ?

If C.5 ends at around 1384, the ideal correction target for C is where the previous 4 ends (C.4, i.e., 1300 area)

3) how can we draw the a-b-c waves after C5 (It's not indicated in the chart ??) I mean wave 'b' is great than C5 <-- Does it mean 'extend' wave instead of a-b-c waves (purple lines) ?

The ending of C.5 is the ending of wave-C. After that a wave-D could be formed. We don't know if wave-D will be in regular or irregular correction form until we see the market's behavior.

Posted by snowrider on 02-14-12 12:26 AM:

I'm a big fan of Elliot wave theory and harmonic trading, however you way over complicate the labeling which deters me (and probably others) from following along. Simply stating the pair and TF (in post) with wave counts 1,2,3,4 a,b,c,d and sub waves as 1a, 1b, 1c, 1d ect works just fine. This, of course, is just my opinion, in the whole scheme of things, it doesn't make much difference.

Big ups for the thread though not many people keep up with these sort of threads. So even if you don't conform to my way of thinking do keep posting charts others will surely find it helpful or at the vary least interesting.

johnny2pips - Thanks for commenting and the suggestion. Please take a look the very first post of this thread, and it will give us an idea about the convention of my wave labeling. It is actually much easier to read and much less confusing than that of most famous EW techinicians. Yes, I agree that "it doesn't make much difference" on different labeling ways because we EW techinicians speak the same language - impulsive vs corrective waves.

Posted by snowrider on 02-19-12 05:01 AM:

02/18/2012

Comments are welcome!

Posted by snowrider on 02-21-12 01:28 AM:

Quote from snowrider:

Rothschild - I would guess that SP spot index 1320 area could be where the reversal starts. We need to pay attention if SP ever moves to that area to see if there is any sign of exhaustion.

So you see that 1320 did not show any sign of climax or exhaustion ... and I have been updating the wave count every weekend. Now here is just my guess that a big correction is going to start this week.

Posted by snowrider on 02-21-12 05:07 PM:

for gold, you're saying we're in a triangle, with the E wave having started lower. However, the triangle connecting ABCDE you show is neither descending, ascending, or symmetrical. Am I missing something?

nim1984 - Thanks for commenting. The wave-E scenario was based on the assumption that wave-D must be in a 3-segment movement. Today's price action shows that the purple line scenario is more possible because our previous wave-D has become a 5-segment wave which means that it is not a wave-D any longer. Talking about a triangle, it does not need to be perfectly descending, ascending, nor symmetrical, as long as it is a triangle. Hope this help.

Posted by snowrider on 02-25-12 05:45 PM:

02/25/2012

Comments are welcome!

Posted by snowrider on 03-03-12 04:06 PM:

03/03/2012

Comments are welcome!

Posted by snowrider on 03-11-12 07:48 PM:

03/11/2012

Comments are welcome!

Posted by jas_in_hbca on 03-15-12 07:46 PM:

bot a few apr 505 puts on aapl @ 2.88

looking for 540 to exit some

nice count . hopefully this 5th wave doesnt extend.

looks like a possible exhaustion gap yesterday on hi vol too

Posted by snowrider on 03-16-12 05:18 AM:

Quote from jas_in_hbca:

bot a few apr 505 puts on aapl @ 2.88

looking for 540 to exit some

nice count . hopefully this 5th wave doesnt extend.

looks like a possible exhaustion gap yesterday on hi vol too

jas_in_hbca - Thanks! Yes some people are saying that the release day of iPad3 is the reversal day of AAPL. Now the wave count for SP is taking the grey line scenario, which it has almost finished the 5-5-5 ... wave. I am thinking that either tomorrow or next Wednesday the key reversal could occur.

Posted by snowrider on 03-16-12 02:37 PM:

[quote=2+2=4ex;5482130]Well done on SP 1400. I do not expect it to hold for now either, but do you really believe it will drop below 1300? Not saying I don't think it will or not, just curious about your opinion.[/quote]

4ex - Thanks for commenting. As you know that my prediction is all based on EW theory, sometimes people don't believe something would happen and I don't believe either. If the current wave is really wave-[[B]]-[C]-V-5 (most likely ending today or maybe next wednesday with extension), then next leg could go all the way down to 1280 area. Let's see how the market acts.

Posted by snowrider on 03-17-12 09:01 PM:

03/17/2012

Comments are welcome!

Posted by snowrider on 03-23-12 07:22 PM:

Opinion is that we are due somewhat of a correction in the SP500.

Nice work Snowrider! SP500 will close the week under the 1400 mark and reinforces the downwards trend.

Thank you Michael. I am hoping that SP does not make any extension from here; otherwise, the extension could go to 1440. Let's wait and see.

Posted by MADASINHATTER on 03-23-12 09:25 PM:

Quote from snowrider:

03/17/2012

Comments are welcome!

[

Yeah i got one.Why do you call it perfect? Do you mean in hindsight? Or is it part of the new world order where you take a word or phrase and use it to describe the complete opposite? Like saying " bringing peace and stability" while dropping bombs on people.Is it perfect in that sense? Where you show that it could go either up or down,on a scale of 1-10 how useful and perfect is that,say compared to just guessing?

__________________
REVEREND MADASIN HATTER

Posted by snowrider on 03-24-12 07:15 PM:

Quote from MADASINHATTER:

Yeah i got one.Why do you call it perfect? Do you mean in hindsight? Or is it part of the new world order where you take a word or phrase and use it to describe the complete opposite? Like saying " bringing peace and stability" while dropping bombs on people.Is it perfect in that sense? Where you show that it could go either up or down,on a scale of 1-10 how useful and perfect is that,say compared to just guessing?

MADASINHATTER - I call it Perfect Wave because it is the brand of the series of my wave posts. I could have called it Snowrider's Wave Analysis (but that did not sound powerful). Of course, you can interpet the word "perfect" as anything as you want. The analysis is of some educated guess. Isn't the whole world making guesses all the time? The analysis is based on the Elliott Wave Principle. If you don't know what that is, I would recommend you getting a book and study first.

Posted by bwolinsky on 03-24-12 08:07 PM:

What has your backtest showed and what have your results been?

It's apparent some logic's went into the chart drawings, but none placed on any performance summaries or analysis of the data.

Reminds me of Hershyites, must draw straight lines, without questioning whether they actually did go to where they ended when they were drawn or any regard to what actually happened later.

This thread is missing that analysis, and it's required if you expect anyone to really analyze the charts that have been posted.

__________________
HOW MUCH IS ENOUGH?

Bud Fox

Wall Street

Posted by snowrider on 03-25-12 12:16 AM:

Quote from bwolinsky:

What has your backtest showed and what have your results been?

It's apparent some logic's went into the chart drawings, but none placed on any performance summaries or analysis of the data.

Reminds me of Hershyites, must draw straight lines, without questioning whether they actually did go to where they ended when they were drawn or any regard to what actually happened later.

This thread is missing that analysis, and it's required if you expect anyone to really analyze the charts that have been posted.

bwolinsky - I have extensively played system long time ago, I wrote tons of systems with TradeStation, I did backtesting 24x7, and then I threw all my systems to trash can. What I want to tell you about backtest is ... been there and done that. If you are asking some trader who utilizes price action and/or pattern methodologies (e.g., Gann, Elliott Wave, Dow Theory etc.) about back testing, you ask a wrong question!

I post my wave analysis here not looking for followers. I am looking for people who speak the same langauage (are also playing EW) for discussion. I am looking for people who enjoy playing EW on trading like playing chess. If you don't believe in EW, you won't be interested in reading my posts.

Posted by snowrider on 03-25-12 12:21 AM:

03/24/2012

Comments are welcome!

Posted by bwolinsky on 03-25-12 03:46 AM:

Quote from snowrider:

bwolinsky - I have extensively played system long time ago, I wrote tons of systems with TradeStation, I did backtesting 24x7, and then I threw all my systems to trash can. What I want to tell you about backtest is ... been there and done that. If you are asking some trader who utilizes price action and/or pattern methodologies (e.g., Gann, Elliott Wave, Dow Theory etc.) about back testing, you ask a wrong question!

I post my wave analysis here not looking for followers. I am looking for people who speak the same langauage (are also playing EW) for discussion. I am looking for people who enjoy playing EW on trading like playing chess. If you don't believe in EW, you won't be interested in reading my posts.

Apparently the scientific method is not your forte.

Elliott Wave has been found to be impossible to backtest, so rather than claim your strategies come from EW, it's more that even you don't understand the rules because there aren't any.

You place levels of your trades into a pattern, if it goes here, but not above there then it's one of the markers, but as far as that being predictive, it has been shown to be utterly useless, and until I've seen strategies with backtests based on the method, it will continue to be mindless garbage.

Don't you at least want to know the probabilities of trading using these methods? It seems you're into posting charts, rather than trading. Since you are familiar with tradestation get reacquainted with easylanguage by working from multicharts for awhile, then come back when you've done the work to determine if one of the markers is more likely to happen after another mark was reached, add some logic, then tell us how it does.

I have a lot against EW because it cannot be backtested, and this is a fault so obvious to me I'm always amazed at the poster's lack of incredulity when there is no backtest I would call robust using those so-called "methods." Gann, Elliott Wave, Dow Theory all fall into a category of belief system, not to be used to trade based on any prediction it might make, and only until there are rules for these methods will it ever prove that there is anything profitable about them.

__________________
HOW MUCH IS ENOUGH?

Bud Fox

Wall Street

Posted by Wide Tailz on 03-25-12 04:05 AM:

Quote from bwolinsky:

What has your backtest showed and what have your results been?

It's apparent some logic's went into the chart drawings, but none placed on any performance summaries or analysis of the data.

Reminds me of Hershyites, must draw straight lines, without questioning whether they actually did go to where they ended when they were drawn or any regard to what actually happened later.

This thread is missing that analysis, and it's required if you expect anyone to really analyze the charts that have been posted.

EW is very difficult to back test because programming a pivot requires some critical parameter selection (days back / forward being the first I can think of). From these pivots comes the trend lines, etc. I still haven't figured out how to do it.

A simpler way would be to simply back test your trend following trigger and note from the forward test when it coincided with the various waves, although this creates a danger of counting the waves in hindsight.

The only way, IMO, is to check an EW practitioner's account statement.

Posted by bwolinsky on 03-25-12 04:09 AM:

Quote from Wide Tailz:

The only way, IMO, is to check an EW practitioner's account statement.

So true, but remember your hourly bars lag the reversal significantly.

__________________
HOW MUCH IS ENOUGH?

Bud Fox

Wall Street

Posted by Wide Tailz on 03-25-12 04:12 AM:

Quote from bwolinsky:

I have a lot against EW because it cannot be backtested, and this is a fault so obvious to me I'm always amazed at the poster's lack of incredulity when there is no backtest I would call robust using those so-called "methods." Gann, Elliott Wave, Dow Theory all fall into a category of belief system, not to be used to trade based on any prediction it might make, and only until there are rules for these methods will it ever prove that there is anything profitable about them.

For similar reasons, I have a lot against fundamental analysis.

EW fits into my trend following system by filtering the buy signals by wave type. My be$t trades, by far, have been during a third wave (either the general market or the stock itself).

Wave 3 is the first higher low and breaks the previous trend line, and typically follows noticeable divergence in MACD, RSI, money flow, Stochastics, ROC, and any other momentum indicator. A huge candle as the dam breaks is the final confirmation.

OP: my comment for your analysis is that I'm amazed how far you take the corrective wave counts. I've never had much success trying to analyze them. I see the SP500 currently in a B wave completing the C wave of next lower degree, itself seeing wave 5 of next lower degree completing as I type.....

Posted by Wide Tailz on 03-25-12 04:14 AM:

Quote from bwolinsky:

So true, but remember your hourly bars lag the reversal significantly.

I'm willing to give up a substantial part of the move for a better confirmation that it is actually happening.

Posted by snowrider on 03-25-12 08:42 PM:

Hi snowrider some great posts on EW well done, some interesting points mapped out in the S&P.... I just have a question... is there any distinction on grey/purple trend lines? i.e one more probable than the other

BoyTrader - Thanks for nice words. The purple lines are my preferred wave counts, while the grey ones are the alternative counts. Of course there are numerous possible wave counts out there, and different people have different preferred counts. I trade to the direction of the purple line. Once the market reaches some point where the purple line becomes invalid, the grey line takes over and becomes the preferred one.

Posted by snowrider on 03-25-12 09:06 PM:

Quote from Wide Tailz:

For similar reasons, I have a lot against fundamental analysis.

EW fits into my trend following system by filtering the buy signals by wave type. My be$t trades, by far, have been during a third wave (either the general market or the stock itself).

Wave 3 is the first higher low and breaks the previous trend line, and typically follows noticeable divergence in MACD, RSI, money flow, Stochastics, ROC, and any other momentum indicator. A huge candle as the dam breaks is the final confirmation.

OP: my comment for your analysis is that I'm amazed how far you take the corrective wave counts. I've never had much success trying to analyze them. I see the SP500 currently in a B wave completing the C wave of next lower degree, itself seeing wave 5 of next lower degree completing as I type.....

Wide Tailz - Thanks for commenting. Believe it or not, I don't give a shxt on any fundamental analysis. Ironically, I used to be doing and writting a lot of fundamental analysis, and I knew that it was just like writing some stories because people wanted to read stories.

I strongly agree with you that the best and easist trades are on the wave-3. About the question how I "take the corrective wave counts", I start from the highest possible degree of timeframe (e.g., montly chart) to analyze and then scale down to the tradeable timeframe (e.g., daily chart). Therefore, sometime a corrective wave in a monthly chart still has some impulsive wave in the daily chart which we can make money from.

Posted by snowrider on 03-30-12 01:36 AM:

03/29/2012

Comments are welcome!

Posted by jas_in_hbca on 03-30-12 04:23 PM:

Hey Snowrider,

I'm counting it different but same result. Should be turning lower.

thanks for your posts !

Posted by snowrider on 03-30-12 06:46 PM:

Quote from jas_in_hbca:

Hey Snowrider,

I'm counting it different but same result. Should be turning lower.

thanks for your posts !

jas_in_hbca - thanks for posting. That is similar to my original weekly wave count. I just posted an alternative count.

Posted by snowrider on 03-31-12 06:23 PM:

03/31/2012

Comments are welcome!

Posted by snowrider on 04-08-12 03:13 AM:

04/07/2012

Comments are welcome!

Posted by ScalperJoe on 04-08-12 07:04 PM:

snowrider,

I am discussing the current waves with trader collegue regarding the S&P, and we have come to the following conclusion that Wave 5 of Wave 3 has completed, and the S&P is currently in Wave 4. I've also read and heard that Wave 4 of the larger pattern already occurred, however our analysis is there has not been any significant pullback to justify a completed Wave 4.

Our wave counts of the larger pattern (weekly chart):

Wave 1 from 1,075 to 1,293

Wave 2 from 1,293 to 1,159

Wave 3 from 1,159 to 1,422

Wave 4 will result in a choppy "A-B-C" pattern, perhaps stalling around 1,320 (38.2% fib of Wave 3), although holding well above the top of Wave 1 at 1,293.

Then a rebound Wave 5 pattern which will break the top of Wave 3 of 1,422, hence completing the 5 wave pattern that began on October.

A larger correction (perhaps 50%) of the completed 5 wave pattern will create the next big buying oppourtunity.

Please provide feedback/comments to this analysis, thanks.

Posted by snowrider on 04-09-12 02:05 AM:

Quote from ScalperJoe:

snowrider,

I am discussing the current waves with trader collegue regarding the S&P, and we have come to the following conclusion that Wave 5 of Wave 3 has completed, and the S&P is currently in Wave 4. I've also read and heard that Wave 4 of the larger pattern already occurred, however our analysis is there has not been any significant pullback to justify a completed Wave 4.

Our wave counts of the larger pattern (weekly chart):

Wave 1 from 1,075 to 1,293

Wave 2 from 1,293 to 1,159

Wave 3 from 1,159 to 1,422

Wave 4 will result in a choppy "A-B-C" pattern, perhaps stalling around 1,320 (38.2% fib of Wave 3), although holding well above the top of Wave 1 at 1,293.

Then a rebound Wave 5 pattern which will break the top of Wave 3 of 1,422, hence completing the 5 wave pattern that began on October.

A larger correction (perhaps 50%) of the completed 5 wave pattern will create the next big buying oppourtunity.

Please provide feedback/comments to this analysis, thanks.

ScalperJoe- Thanks for sharing your thought. That scenario is a good and valid one. Please see attached wave count. Your wave count is labeled there as [A][B][C][D][E] in green line alternative count. Currently my preferred count is that a wave-[[B]] (which is your wave-3) has ended, and a big collapse all the way to 960 area in the end of this year is underway. I will pay very close attention if SP ever goes to 1320 area to see if it has any sign of bottoming there. The 1320 area will be the cross road between a real collapse or a final leg up.

Posted by snowrider on 04-09-12 02:35 AM:

...
One question for you is that you think we are still in the wave 4 from peak of 2000? What formation will this wave 4 take?
...

busted - Thanks for commenting. Yes, I agree with you (kind of) that EW "is very complicated". But I would like to say that it is very easy to use in trading (because EW has some rules for validating a wave). About your question if "we are still in the wave 4 from peak of 2000", that is what my assumption for labelling 667 (2009) as [[[C]]] is based on. With that assumption, the "wave 4" is in the formation of a huge triangle. About QE3, I don't care, and I never care any FA stuff.

Posted by ScalperJoe on 04-11-12 12:25 AM:

Quote from snowrider:

Currently my preferred count is that a wave-[[B]] (which is your wave-3) has ended, and a big collapse all the way to 960 area in the end of this year is underway.

Got it, thanks. However, I'm curious as to how you get the 960 target, and what is the scenario for it to occur this year?

If it breaks 1,320 then perhaps it goes flatline to around 1,250-1,290 range during mid-summer (near mid-point of 5 wave pattern which began last October), before closing out in the black for 2012.

Without some climactic event (war, lack of additional QE, hyperinflation, Euro/dollar collapse, etc), I'm not sure the market is poised break the prior two years of intrayear lows and to fall to 960. I'm not suggesting it won't retrace on the larger wave count eventually, just not by the end of this year.

Your thoughts, comments?

Posted by toc on 04-12-12 03:07 AM:

1260 is my target too (not by elliot wave though) but cannot make a case for 960 as of yet.

Ok here I see.........from the low of 66.75 on Spy to high of 142.21 it is roughly 75 points. 62.5% retracement gives 46 odd points which takes it 960 (950.48 to be exact).

Posted by snowrider on 04-12-12 04:26 AM:

Quote from ScalperJoe:

Got it, thanks. However, I'm curious as to how you get the 960 target, and what is the scenario for it to occur this year?

If it breaks 1,320 then perhaps it goes flatline to around 1,250-1,290 range during mid-summer (near mid-point of 5 wave pattern which began last October), before closing out in the black for 2012.

Without some climactic event (war, lack of additional QE, hyperinflation, Euro/dollar collapse, etc), I'm not sure the market is poised break the prior two years of intrayear lows and to fall to 960. I'm not suggesting it won't retrace on the larger wave count eventually, just not by the end of this year.

Your thoughts, comments?

ScalperJoe - Thanks for nice commenting. About the 960 area target, it is just at a 0.382 fib ratio from 2009-03 lo to the recent hi. I would like to take back what I mentioned last time about the timing of the end of this year. I mentioned that because I wanted to load something for next year by the end of this year. The actual timing could be 2013-09 to see the big cycle low. When the time is there, and when the price is at a fib ratio (say, 0.5 at 1045), that will be an excellent opportunity to load.

Posted by snowrider on 04-12-12 04:43 AM:

Quote from toc:

1260 is my target too (not by elliot wave though) but cannot make a case for 960 as of yet.

Ok here I see.........from the low of 66.75 on Spy to high of 142.21 it is roughly 75 points. 62.5% retracement gives 46 odd points which takes it 960 (950.48 to be exact).

toc - Thanks for comments. Yep, that is a fic ratio retracement, but my timing was not right about the year end.

Posted by toc on 04-12-12 07:11 AM:

Snowrider,

given that you have been doing the EW for sometime now, what percentage of your calls prove to be good. have never been into EW although use Fib retracements etc. at times.

Posted by snowrider on 04-12-12 02:58 PM:

Quote from toc:

Snowrider,

given that you have been doing the EW for sometime now, what percentage of your calls prove to be good. have never been into EW although use Fib retracements etc. at times.

toc - The successful rate of my purple lines (preferred counts) is about 50% (half-half), so it is nothing special and nothing significant by simply following my purple lines. However, the good thing and advantage of using EW for trading because it provides some strict rules so that we know where to go and where to stop once our preferred counts are wrong.

Posted by ScalperJoe on 04-13-12 05:19 AM:

snowrider,

Given the recent swings in SPX, is it safe to interpret the past five down bars as "A" and today's snap back rally as "B" of Wave 4, which may last a few more days, followed by a "C" wave back down? The way I read the current pattern, the SPX falls below its current 50 day moving average of 1,370 again, thus completing the A-B-C pattern in Wave 4.

However, I find the difficulty in EW analysis is in attempting to pinpoint the accuracy of when Wave 4 ends and when Wave 5 begins, until of course after the fact!

Posted by snowrider on 04-13-12 02:38 PM:

Quote from ScalperJoe:

snowrider,

Given the recent swings in SPX, is it safe to interpret the past five down bars as "A" and today's snap back rally as "B" of Wave 4, which may last a few more days, followed by a "C" wave back down? The way I read the current pattern, the SPX falls below its current 50 day moving average of 1,370 again, thus completing the A-B-C pattern in Wave 4.

However, I find the difficulty in EW analysis is in attempting to pinpoint the accuracy of when Wave 4 ends and when Wave 5 begins, until of course after the fact!

ScalperJoe - Yes, that is a way of counting this if we predict that the downward movement is in ABC mode. Another way of counting this is to treat the 5 down bars as wave 1 of the downward movement, so we just about finishing wave 2. There are many other ways of counting this. My trading philosophy is trying to lay out as many possible counts as I can, and then watch those critical area to see if there is any reversal sign (in order to confirm which count is more likely and to trade).

Posted by snowrider on 04-15-12 05:15 AM:

04/14/2012

Comments are welcome!

Posted by EliteThink on 04-15-12 05:26 PM:

the odds of that occuring in an election year for the spx are low. 1325-1340 should be solid support.

Posted by snowrider on 04-16-12 03:28 AM:

Quote from EliteThink:

the odds of that occuring in an election year for the spx are low. 1325-1340 should be solid support.

EliteThink - Thanks for sharing your thought!

Posted by snowrider on 04-16-12 03:29 AM:

snowrider,
the count of the "thewavetrading" since the oct. 2011 low for the S&P is more logic for me than yours:

http://imageshack.us/photo/my-images/51/ewsp124.png/
Sixer

Sixer - Thanks for sharing your thought! Yes, yours is a valid and good count. I have had similar count before changing to the current one. If we count that way, the wave-IV (your (4) wave) could also be counted as a flat. See the following old post:

And your count:

Posted by EliteThink on 04-16-12 08:23 PM:

Quote from snowrider:

EliteThink - Thanks for sharing your thought!

likewise

Posted by snowrider on 04-22-12 02:54 AM:

04/21/2012

Comments are welcome!

Posted by Wide Tailz on 04-22-12 05:05 AM:

So we all anticipate the SP500 coming down from the bear flag. This consensus makes me nervous... traders rarely agree!

Posted by snowrider on 04-22-12 05:00 PM:

Quote from Wide Tailz:

So we all anticipate the SP500 coming down from the bear flag. This consensus makes me nervous... traders rarely agree!

Wide Tailz - Thanks for commenting. I am nervous too because the market won't let people make money so easily. See my purple line wave count has a wave-2 in a bull trap formation. I would like to see a pop before the market starts moving down.

Posted by snowrider on 04-28-12 09:29 PM:

04/28/2012

Comments are welcome!

Posted by Wide Tailz on 04-29-12 02:07 AM:

That looks very logical. Chop like this makes me so angry some days!

Perhaps I can see a hypnotist to get me to stop trading during corrective waves. They are unpredictable.

Posted by ammo on 04-29-12 03:56 AM:

post bank intervention it's much easier to manipulate ,no bear stearns to pick off the whales,eom and expo seem to always work upward,snow,thanks for putting this out there

Posted by snowrider on 04-30-12 06:39 AM:

Quote from Wide Tailz:

That looks very logical. Chop like this makes me so angry some days!

Perhaps I can see a hypnotist to get me to stop trading during corrective waves. They are unpredictable.

LOL ... cheer up man ... I have been losing money in this corrective wave. A trend will eventually come back.

Posted by snowrider on 04-30-12 06:44 AM:

Quote from ammo:

post bank intervention it's much easier to manipulate ,no bear stearns to pick off the whales,eom and expo seem to always work upward,snow,thanks for putting this out there

ammo - You are welcome, and thanks for reading and commenting.

Posted by Wide Tailz on 05-01-12 05:14 PM:

Quote from snowrider:

LOL ... cheer up man ... I have been losing money in this corrective wave. A trend will eventually come back.

Looks like you called it . . . nice B wave back up.

. . . or did the B-C already happen, in the bottom of the box?

Posted by snowrider on 05-02-12 04:03 AM:

Quote from Wide Tailz:

Looks like you called it . . . nice B wave back up.

. . . or did the B-C already happen, in the bottom of the box?

Wide Tailz - please see my next post.

Posted by snowrider on 05-02-12 04:04 AM:

05/01/2012

Comments are welcome!

So ... possiblly an ending diagonal triangle is forming.

Posted by snowrider on 05-06-12 12:21 AM:

05/05/2012

Comments are welcome!

Posted by ScalperJoe on 05-06-12 06:15 AM:

Since the 5 bar drop on Wave "A" (of the bigger Wave 4) began on April 3rd, the SPX has failed to break the 1,357 low on each subsequent retest. Although the overall uptrend is still intact, I see two possible scenarios regarding the recent weakness:

1. The SPX holds 1,370 to rally back over 1,411 (but still does not break the 1,422 highs) and completes wave 5 of "B", before a "C" wave correction starts and lasts through the summer doldrums.

2. The SPX continues to sell off and break 1,357 (Wave "A" low), the chop was all "B", and the confirmed break of 1,357 will define "C".

Either way, there is probably more volatility and chop until the uptrend resumes in Wave 5.

Posted by Wide Tailz on 05-06-12 06:33 AM:

If the market bounces hard, here is another possibility.

Posted by ScalperJoe on 05-07-12 01:41 AM:

Looks like futures are down big on Europe news/France election results. Wave A low of 1,357 has been breached as of Sunday evening (which was 1352.50 on the futures).

Posted by snowrider on 05-07-12 02:26 PM:

It's good that SP futures pulls up a lot before the market opens. We will need to watch to see if the cash index would fall below the starting point of last up waves - the low of 04/23/2012 in order to decide which count is valid.

If 04/23/2012's low is breached, the wave count of 04/28/2012's post becomes valid. Otherwise, last weekend's count is valid.

Posted by snowrider on 05-07-12 04:43 PM:

Quote from ScalperJoe:

Since the 5 bar drop on Wave "A" (of the bigger Wave 4) began on April 3rd, the SPX has failed to break the 1,357 low on each subsequent retest. Although the overall uptrend is still intact, I see two possible scenarios regarding the recent weakness:

1. The SPX holds 1,370 to rally back over 1,411 (but still does not break the 1,422 highs) and completes wave 5 of "B", before a "C" wave correction starts and lasts through the summer doldrums.

2. The SPX continues to sell off and break 1,357 (Wave "A" low), the chop was all "B", and the confirmed break of 1,357 will define "C".

Either way, there is probably more volatility and chop until the uptrend resumes in Wave 5.

ScalperJoe - Thanks for sharing your thought!

Posted by snowrider on 05-07-12 04:45 PM:

Quote from Wide Tailz:

If the market bounces hard, here is another possibility.

Wide Tailz - Nice count! Thanks for sharing.

Posted by ScalperJoe on 05-07-12 11:04 PM:

Quote from snowrider:

It's good that SP futures pulls up a lot before the market opens. We will need to watch to see if the cash index would fall below the starting point of last up waves - the low of 04/23/2012 in order to decide which count is valid.

If 04/23/2012's low is breached, the wave count of 04/28/2012's post becomes valid. Otherwise, last weekend's count is valid.

Just so I understand this correctly, as this is very interesting regarding the wave count, if the futures (/ES) breached but SPX did not, which takes precedence in accurately counting the waves?

Posted by snowrider on 05-07-12 11:59 PM:

Quote from ScalperJoe:

Just so I understand this correctly, as this is very interesting regarding the wave count, if the futures (/ES) breached but SPX did not, which takes precedence in accurately counting the waves?

ScalperJoe - Very good point! That is a very good question indeed! We trade wave, which is following some natual law, so we want to trade something that has good liquidity and good volume. The more people participate the market, the more accurate we can get from counting the wave. It is a dilemma whether we should or should not count the wave of after hour's futures market. The after hour's trading is much easier to be manipulated. What I do is to have a 2-way consideration: I count both SPX and futures index. Today's market is an example that the after hour trading penetrated 04/23's low, but in the regular hour the market tried many time without being able to breach that key support. Now I guess that we have two possible counts:
1. ABC has completed the wave [IV], so the market is heading north for [V].
2. Or the market is heading down in a massive wave-III collapse.

Posted by ScalperJoe on 05-08-12 06:09 AM:

Quote from snowrider:

Today's market is an example that the after hour trading penetrated 04/23's low, but in the regular hour the market tried many time without being able to breach that key support. Now I guess that we have two possible counts:

1. ABC has completed the wave [IV], so the market is heading north for [V].
2. Or the market is heading down in a massive wave-III collapse.

Ok that makes sense, thanks for the clarification.

Posted by jas_in_hbca on 05-08-12 03:28 PM:

Looking for a bottom likely sometime today.

Posted by snowrider on 05-08-12 03:28 PM:

Quote from ScalperJoe:

Ok that makes sense, thanks for the clarification.

Thanks for sharing your thought and being a nice audience of my wave threads. I have started a blog as my trade journal to post my real time trades there to share with friends. Welcome to take a look. Thanks!

Posted by snowrider on 05-08-12 03:31 PM:

Quote from jas_in_hbca:

Looking for a bottom likely sometime today.

jas_in_hbca - Thanks for sharing! Yes, it looks like a well defined 5-wave down.

Posted by ScalperJoe on 05-09-12 05:58 AM:

Yes, the 5-wave pattern on SPY (or SPX) is well defined. 1,357 (Wave "A" low of the bigger Wave 4) was breached, however the March low of 1,340 was not.

So the question is this: If the "A-B-C" of 4 is now complete, is the market now in [V]?

If so, then one can view the sharp intraday rally from the bottom as "A" which should create a pullback buying opportunity in "B".

Posted by snowrider on 05-09-12 07:31 AM:

Quote from ScalperJoe:

Yes, the 5-wave pattern on SPY (or SPX) is well defined. 1,357 (Wave "A" low of the bigger Wave 4) was breached, however the March low of 1,340 was not.

So the question is this: If the "A-B-C" of 4 is now complete, is the market now in [V]?

If so, then one can view the sharp intraday rally from the bottom as "A" which should create a pullback buying opportunity in "B".

ScalperJoe - Good observation! To answer your question, I woud like to bring up the two scenarios that we might have:
1. If the big wave-[B] was completed on 11/25/2011, then we could have a wave-V to test last month's high.
2. If the big wave-[B] was completed on 12/19/201, then we are in a down trend now. Any up move will be corrective wave.

I'll post the charts of these two scenario on my blog in a little bit.

Posted by ScalperJoe on 05-10-12 05:09 AM:

Quote from snowrider:

I woud like to bring up the two scenarios that we might have:
1. If the big wave-[B] was completed on 11/25/2011, then we could have a wave-V to test last month's high.
2. If the big wave-[B] was completed on 12/19/201, then we are in a down trend now. Any up move will be corrective wave.

Ok, so if the March low of 1,340 holds then I agree with scenario 1 that the market would rally as a wave [V] for a retest of the highs.

If it doesn't, then one target for scenario 2 downtrend is the next fib level of the bigger 5 wave pattern, which happens to correspond very closely with the Wave 1 top of around 1,293.

Given that the 100day moving average and two large daily tails offer support on the SPX chart, it seems more likely that your scenario 1 will prevail. These corrective wave patterns are quite tricky, and definitely have more headfakes than the clearer Wave 3 pattern.

Posted by snowrider on 05-10-12 02:52 PM:

Quote from ScalperJoe:

Ok, so if the March low of 1,340 holds then I agree with scenario 1 that the market would rally as a wave [V] for a retest of the highs.

If it doesn't, then one target for scenario 2 downtrend is the next fib level of the bigger 5 wave pattern, which happens to correspond very closely with the Wave 1 top of around 1,293.

Given that the 100day moving average and two large daily tails offer support on the SPX chart, it seems more likely that your scenario 1 will prevail. These corrective wave patterns are quite tricky, and definitely have more headfakes than the clearer Wave 3 pattern.

ScalperJoe - Good point! Yes, the 1340 is the wave-4 (the lower degree wave) where a corrective wave would stop. Thanks for summerizing those two scenarios. Today the market gaps up, we will need to see if the gap can hold or not. If the gap holds and market goes higher, then probably the wave-[V] is underway. If the market fails to move up, we need to be careful that it could be forming a wave-2 (corrective wave) in the scenario #2.

Posted by toc on 05-10-12 03:23 PM:

Quote from snowrider:

Thanks for sharing your thought and being a nice audience of my wave threads. I have started a blog as my trade journal to post my real time trades there to share with friends. Welcome to take a look. Thanks!

What is the link or name of the blog

Posted by snowrider on 05-10-12 04:31 PM:

Quote from toc:

What is the link or name of the blog

PerfectEW.blogspot.com

I set up the blog last week. I have started posting my real time trades there. Thanks for commmenting!

Posted by Wide Tailz on 05-11-12 05:59 AM:

Decision time. Wave 4 typically does not go below the fourth wave of the previous impulse wave. Notice the horizontal support on all the major indices?

If we go any lower, Bernanke and The Bulls are going to be in serious trouble.

Posted by ScalperJoe on 05-11-12 06:54 AM:

Quote from Wide Tailz:

Decision time. Wave 4 typically does not go below the fourth wave of the previous impulse wave. Notice the horizontal support on all the major indices?

If we go any lower, Bernanke and The Bulls are going to be in serious trouble.

Yes, the horizontal support is definitely holding it up. Also, the market is almost equally distant from the top of Wave 3 (1,422) and the top of Wave 1 (1,293), thus causing a very choppy and rangebound current pattern. It's a classic struggle between the bulls and bears.

No need for the bulls to worry though, Uncle Ben's got his helicopter ready, and will be flying all over dropping freshly printed fiat currency like leaflets in a war zone!

Posted by ammo on 05-11-12 07:08 AM:

Quote from Wide Tailz:

Decision time. Wave 4 typically does not go below the fourth wave of the previous impulse wave. Notice the horizontal support on all the major indices?

If we go any lower, Bernanke and The Bulls are going to be in serious trouble.

i use mp and a lot of times it overrides the smaller time frames s/r and you go to a larger timeframe and you see them, do you have the same problem with ew,i included a monthly chart would some ew'er be kind enough to draw the past waves in,a,bc and 1 thru 5

Posted by bwolinsky on 05-11-12 09:06 AM:

Can someone build a backtest on EW?

If not, then there is no method.

__________________
HOW MUCH IS ENOUGH?

Bud Fox

Wall Street

Posted by snowrider on 05-11-12 02:46 PM:

Quote from ammo:

i use mp and a lot of times it overrides the smaller time frames s/r and you go to a larger timeframe and you see them, do you have the same problem with ew,i included a monthly chart would some ew'er be kind enough to draw the past waves in,a,bc and 1 thru 5

ammo - I set up my blog last week and posted some possible long term counts in the archive. Some of them are out-dated but still worth taking a look. Note that my wave counts have grey line and purple line so you can see the wave from different perspectives. Thanks.

Posted by snowrider on 05-11-12 02:50 PM:

Quote from Wide Tailz:

Decision time. Wave 4 typically does not go below the fourth wave of the previous impulse wave. Notice the horizontal support on all the major indices?

If we go any lower, Bernanke and The Bulls are going to be in serious trouble.

Wide Tailz - Yes, I agree that wave 4 is a critical support. The market looks so far so good. I will still be cautious. My portfolio has loaded tons of TLT, FAZ, and EDZ for my long term trade (published on my blog) and some short positions on GC, SP, EUR for short term.

Posted by snowrider on 05-11-12 02:55 PM:

Quote from ScalperJoe:

Yes, the horizontal support is definitely holding it up. Also, the market is almost equally distant from the top of Wave 3 (1,422) and the top of Wave 1 (1,293), thus causing a very choppy and rangebound current pattern. It's a classic struggle between the bulls and bears.

No need for the bulls to worry though, Uncle Ben's got his helicopter ready, and will be flying all over dropping freshly printed fiat currency like leaflets in a war zone!

ScalperJoe - Currently a possible wave count is in the abc wave 2 bounce from Wednesday's low. If this is the case, after this wave 2, next monday could be a big gap down.

Posted by snowrider on 05-11-12 03:01 PM:

Quote from bwolinsky:

Can someone build a backtest on EW?

If not, then there is no method.

bwolinsky - I remember that we have talked about this before. Trading is not a science. Trading with EW is more than an art. If you are trying to find something guaranteed, there is no such thing. I set up a blog last week and started posting my trades for long term timeframe in real time there. You are welcome to see for yourself to verify whether EW worth your time.

Posted by Wide Tailz on 05-12-12 05:15 AM:

Quote from bwolinsky:

Can someone build a backtest on EW?

If not, then there is no method.

Since all you seem to be able to understand is back testing, why not explain the phenomenon called "overfitting". You seem to have some first hand experience in this area.

Posted by snowrider on 05-13-12 03:44 AM:

05/12/2012

Comments are welcome!

Posted by ScalperJoe on 05-15-12 05:00 AM:

Quote from snowrider:

ScalperJoe - Currently a possible wave count is in the abc wave 2 bounce from Wednesday's low. If this is the case, after this wave 2, next monday could be a big gap down.

Good call, and the SPX breached the March low and closed below 1,340. So for the current wave count to remain intact, the third wave of [IV] cannot breach 1,293 (Wave [I] top), is that correct?

Posted by snowrider on 05-15-12 06:16 AM:

Quote from ScalperJoe:

Good call, and the SPX breached the March low and closed below 1,340. So for the current wave count to remain intact, the third wave of [IV] cannot breach 1,293 (Wave [I] top), is that correct?

Yes, that is correct! If we count the high of 10/27/2011 as the ending point of wave-[I], the current pull back should not fall below that point. In other words, wave-[IV] and wave-[I] won't overlap.

Posted by snowrider on 05-16-12 09:14 PM:

Here is my portfolio as of today's close:

Long Term - Big troop dolloar amount allocation: TLT 50% cash 50% (no change)
Medium Term - Small troop stock holding: EDZ, FAZ, TZA (no change)

The market closed near day low again today. This is a very bearish price action where the market sucked and trapped more bulls in the moring before the decisive moving down in the afternoon. If the current preferred wave count is correct, we are in 3._3._3 wave underway. If the wave fractal reproduces itself of the wave-1, we will be seeing a big gap down and with a killing collapse very soon. Remember that this bear run is far from over! DO NOT buy any dips! All posts will be synch-ed to my blog.

Posted by snowrider on 05-17-12 03:58 PM:

Let me tell you my friends, the most dangerous bear market formation is a long winding slow motion one! The money flows outward from equity (slowly) into some other markets (e.g., bonds). Every time the stock market falls to a support (temporarily), it attracts some little bulls to buy, and the market gets rebound, but the market falls below the support area few days after and traps more people. In conclusion, DO NOT buy into any dip! Any surge is your opportunity to unload your stock and go short. The bear market has just started and is far from over.

Posted by ScalperJoe on 05-18-12 05:28 AM:

Quote from snowrider:

Let me tell you my friends, the most dangerous bear market formation is a long winding slow motion one! The money flows outward from equity (slowly) into some other markets (e.g., bonds). The bear market has just started and is far from over.

Yes, it does seem the S&P is heading for flatline of 1,257 for the year.

However, would you change your analysis of the pending bear market if the S&P held above 1,293 Wave [1] top and reversed back up?

In other words, at what point does the "ABC" correction of Wave [IV] convert into a Wave 3 collapse?

Posted by snowrider on 05-18-12 06:30 AM:

Quote from ScalperJoe:

Yes, it does seem the S&P is heading for flatline of 1,257 for the year.

However, would you change your analysis of the pending bear market if the S&P held above 1,293 Wave [1] top and reversed back up?

In other words, at what point does the "ABC" correction of Wave [IV] convert into a Wave 3 collapse?

ScalperJoe - Thanks for the feedback. It could be heading to 1257 because of current downward momentum. About the question whether 1293 will hold, I would bet that it could be breached tomorrow (Friday) morning right at openning. Why do I make this speculation? Because of today's solid long black candle with high volume. If we don't have a strong intervention or super good news tomorrow, the wave count should be staying the same direction. About the question when the "ABC" scenario should be voided, I would still say that the high of 10/27/2011 (i.e., 1292.66) is the key observation point. BTW, I will synch this conversation to my blog. Thanks.

Posted by jas_in_hbca on 05-18-12 10:11 PM:

Nice job Snowrider !

Posted by Wide Tailz on 05-19-12 03:04 AM:

If we don't rebound here, the picture will start to get scary.

Posted by bwolinsky on 05-19-12 04:44 AM:

Quote from Wide Tailz:

If we don't rebound here, the picture will start to get scary.

Stock Indexes are trying to make a higher low.

When they do the next oscillation is a lower high, and if the market breaks the eventual lows of this higher low, that will be the start of a new bear trend. If we set another higher low after the next lower high oscillation, that will be a net positive, but I fear this may be the start of a bear market with one last rally before dropping below the new lows.

__________________
HOW MUCH IS ENOUGH?

Bud Fox

Wall Street

Posted by ScalperJoe on 05-19-12 08:38 PM:

Quote from Wide Tailz:

If we don't rebound here, the picture will start to get scary.

Agreed. Here are some points to consider:

1. Wave [I] top of 1,293 was breached intraday, but Friday's SPX close was at 1,295.

2. The SPX is nearing its 38.2% fib retracement from the October 2011 lows.

Next week's price action will most likely paint the picture of whether or not the SPX can hold above the close of October 2011 lows and the fib level.

Obviously the hype of Facebook's IPO didn't help the tech sector. And Uncle Ben is nowhere to be found, for now.

Posted by bwolinsky on 05-19-12 09:36 PM:

Where is the backtest of this nonsense?

Elliot Wave is bunk, because there is no strategy defined by it, making it subjective and unsystematic.

EW is not a strategy until there's a simulation of it.

__________________
HOW MUCH IS ENOUGH?

Bud Fox

Wall Street

Posted by flipside21 on 05-19-12 09:58 PM:

Quote from bwolinsky:

Where is the backtest of this nonsense?

Elliot Wave is bunk, because there is no strategy defined by it, making it subjective and unsystematic.

EW is not a strategy until there's a simulation of it.

Paul Tudor Jones likes it.
I think EW theory has some validity.
Some other people call it the Idiot Wave Theory because it resembles so much of a Rorschach Test.

Posted by bwolinsky on 05-19-12 10:17 PM:

Quote from flipside21:

Paul Tudor Jones likes it.
I think EW theory has some validity.
Some other people call it the Idiot Wave Theory because it resembles so much of a Rorschach Test.

Rorschace is bullshit, just like EW.

No strategy is no strategy.

Unless there is a backtest of it, this thread will continually waste everybody's time.

If there isn't a method to EW then it is really faith based, not factual.

__________________
HOW MUCH IS ENOUGH?

Bud Fox

Wall Street

Posted by ammo on 05-19-12 10:50 PM:

blow quit being a blowhard,you're still wet behind the ears,a little bit of knowledge is a dangerous thing, stop wasting your high I Q,keep your trap shut and open your eyes and ears,you might learn something you don't know,surprise yourself

Posted by ScalperJoe on 05-20-12 02:07 AM:

Quote from bwolinsky:

No strategy is no strategy.

Unless there is a backtest of it, this thread will continually waste everybody's time.

If there isn't a method to EW then it is really faith based, not factual.

Where is the backtest of your emotions?

Markets are defined by cycles and patterns. They tend to follow prior support and resistance levels, fibonacci sequences, and fill any prior gaps (above and below).

Elliott Wave is not absolute. Tactical analysis (i.e. market timing) involves short term predictive theories based on past price action. The markets are always changing, so the approach must change to adapt to the market.

Your post cited below is also just a prediction, just like the ones we're all making as well.

Quote from bwolinsky:

Stock Indexes are trying to make a higher low.

When they do the next oscillation is a lower high, and if the market breaks the eventual lows of this higher low, that will be the start of a new bear trend. If we set another higher low after the next lower high oscillation, that will be a net positive, but I fear this may be the start of a bear market with one last rally before dropping below the new lows.

Posted by snowrider on 05-20-12 02:25 AM:

Quote from bwolinsky:

Where is the backtest of this nonsense?

Elliot Wave is bunk, because there is no strategy defined by it, making it subjective and unsystematic.

EW is not a strategy until there's a simulation of it.

bwolinsky - OK I know that you want to know EW more so much. I don't know a way to convince you that EW is one of the best approaches to use for trading. Do you still keep the link of my blog? Please go there, join the blog, and see my real-time trading for yourself.

Posted by bwolinsky on 05-20-12 03:48 AM:

Quote from snowrider:

bwolinsky - OK I know that you want to know EW more so much. I don't know a way to convince you that EW is one of the best approaches to use for trading. Do you still keep the link of my blog? Please go there, join the blog, and see my real-time trading for yourself.

I can spot unintentional dishonesty from a mile away.

If there was a strategy here, the backtest results would already exist in the thread.

Since there is no strategy but guessing, ew exists as fantasy with neither rational nor reasonable basis.

You can start defining chart patterns according to your parts of the wave...wait, you can't because there has never been a defined strategy. If there was, you'd be able to tell us what part of a wave is more likely from each point of ew with an accurately calculated backtest.

Since no such backtest exists every mindless strategists that tells me there is anything to ew is wasting their breath with me, or else they'd be able to say what the expectancy per trade is whenever they're trading based on ew.

__________________
HOW MUCH IS ENOUGH?

Bud Fox

Wall Street

Posted by snowrider on 05-20-12 05:44 AM:

Quote from bwolinsky:

I can spot unintentional dishonesty from a mile away.

If there was a strategy here, the backtest results would already exist in the thread.

Since there is no strategy but guessing, ew exists as fantasy with neither rational nor reasonable basis.

You can start defining chart patterns according to your parts of the wave...wait, you can't because there has never been a defined strategy. If there was, you'd be able to tell us what part of a wave is more likely from each point of ew with an accurately calculated backtest.

Since no such backtest exists every mindless strategists that tells me there is anything to ew is wasting their breath with me, or else they'd be able to say what the expectancy per trade is whenever they're trading based on ew.

bwolinsky - Sorry that you feel that way. Basically, you are looking for a holy grail that can guarantee you the success of trading. I don't want to disappoint you, but at least I haven't found one before I started trading with EW. Talking about backtesting, I remember that I told you that I have done that long time ago with designing my own trading systems. If you want to pursue that route, good luck to you my friend! I enjoy playing EW and get much more fun from this over system trading.

Posted by snowrider on 05-20-12 07:45 PM:

05/20/2012

Comments are welcome!

Posted by ScalperJoe on 05-20-12 11:30 PM:

snowrider,

SPX did not close below the Wave [I] top, but simply breached it intraday, do you still consider that as a breach of the original wave count?

By the way, futures just opened recently and look weak, ES at 1,289.

Posted by snowrider on 05-21-12 02:14 AM:

Quote from ScalperJoe:

snowrider,

SPX did not close below the Wave [I] top, but simply breached it intraday, do you still consider that as a breach of the original wave count?

By the way, futures just opened recently and look weak, ES at 1,289.

ScalperJoe - The price action these days has shown that the market was very weak (and could be continue doing so before some reversal force occurs). It is the Newton's First Law of Motion that can easily explain the market's behavior:

"Every object in a state of uniform motion tends to remain in that state of motion unless an external force is applied to it."

We shall stay on the bear side until we see a reversal bar. We should not reverse our short position unless a reversal bar tells us otherwise. Also, it really does not matter whether the 1293 is broken or not because the index should not go this deep if it is still a bull market. Trading is an art, and it's hard to explain why. It is like seeing a piece of art work, some people like it but some don't.

The following quote is from my blog last Friday:

"...The market closed near day low again today, with same trick as what it did everyday in last few days, the market sucked and trapped more bulls (again) in the morning before moving down in the afternoon. The weekly chart closed as a long solid black candle bar - very bearish in long term view. If the current preferred wave count is correct, a 3._3.__3 wave is underway. We will see a big gap down and with a killing collapse very soon (next Monday?). Remember that this bear run is far from over! DO NOT buy into any dip!"

Posted by ScalperJoe on 05-21-12 02:48 AM:

Quote from snowrider:

Also, it really does not matter whether the 1293 is broken or not because the index should not go this deep if it is still a bull market.

I agree with your logic, however I'm still trying to differentiate between corrective wave patterns within the context of the larger timeframes.

If the original Elliott Wave count began with the October 2011 lows, my understanding was the wave count remains intact so long as the TOP of Wave [I] isn't breached, which from a closing basis it wasn't (as of Friday).

In other words, could it still be a valid "ABC" corrective pattern, whereby 1,422 is still the top of Wave [III]?

Posted by snowrider on 05-21-12 04:16 AM:

Quote from ScalperJoe:

I agree with your logic, however I'm still trying to differentiate between corrective wave patterns within the context of the larger timeframes.

If the original Elliott Wave count began with the October 2011 lows, my understanding was the wave count remains intact so long as the TOP of Wave [I] isn't breached, which from a closing basis it wasn't (as of Friday).

In other words, could it still be a valid "ABC" corrective pattern, whereby 1,422 is still the top of Wave [III]?

ScalperJoe - It could be that case because the market stopped right above the 50% fib retracement. If that 50% area holds, we don't rule out the possibility of the wave [IV] scenario, which means that the market would come back to test 1400 area for a wave [V].

Posted by ScalperJoe on 05-21-12 05:13 AM:

Quote from snowrider:

ScalperJoe - It could be that case because the market stopped right above the 50% fib retracement. If that 50% area holds, we don't rule out the possibility of the wave [IV] scenario, which means that the market would come back to test 1400 area for a wave [V].

Ok, got it, thanks.

Posted by snowrider on 05-21-12 07:06 AM:

Quote from jas_in_hbca:

Nice job Snowrider !

Posted by snowrider on 05-21-12 07:08 AM:

Quote from Wide Tailz:

If we don't rebound here, the picture will start to get scary.

Yes, I agree with you! We are at the point where 50% fib retracement meets horizontal support area and up channel line. If this area is breached, it means a free fall.

Posted by snowrider on 05-21-12 07:10 AM:

Quote from flipside21:

Paul Tudor Jones likes it.
I think EW theory has some validity.
Some other people call it the Idiot Wave Theory because it resembles so much of a Rorschach Test.

Interesting!

Posted by Wide Tailz on 05-21-12 04:37 PM:

I recall Paul Tudor Jones quoted as saying EW allows him to find setups with high reward to risk. He also said that Bob Prechter was one of his favorite analysts.

Granted, this was in Market Wizards 1, from the early 90s.

Posted by snowrider on 05-21-12 04:51 PM:

Quote from Wide Tailz:

I recall Paul Tudor Jones quoted as saying EW allows him to find setups with high reward to risk. He also said that Bob Prechter was one of his favorite analysts.

Granted, this was in Market Wizards 1, from the early 90s.

I started studying R.P.'s publications since about the same time. After few years of reading, I found that his wave counts had lots of problems, so I threw them to trash can. I think that R.P. has a lot of contribution to modern EW, but he cannot break through some bottleneck.

Posted by snowrider on 05-22-12 09:21 PM:

From my blog:

The market moved as expected today. Our audience got plenty of time to unload and go short in the morning. The market panicked down in the afternoon and set new day low. If the current preferred wave count is correct, wave 3._4 has ended today, which means that the rest of the week could have bloody slaughtering collapse. Again, this bear run is far from over! DO NOT buy into any dip!

Posted by toc on 05-23-12 01:37 AM:

From one other logic 135 is possible before any further breakdown. I am however not taking any longs right now.

Posted by snowrider on 05-25-12 09:35 PM:

(For more of my analyses and articles, please visit my blog. Thanks.)

The up thrust in futures market overnight penetrated Tuesday's high, and hence my short term short position on index futures got kicked out with big win. The high in regular hours did not even touch Tuesday high. I did not enter a new short position on futures because of the coming long weekend. I'll continue shorting this market next week.

The market has moved in a way that is identical to our prediction since 2 weeks ago (see the purple line wave count). With that said, there is no reason for us to change our preferred scenario at this moment. The downward wave has newly started today. Next week could be a killing bloody week for a wave-5. (This scenario will be voided if a long solid red surge occurs.) The bear run is far from over! DO NOT buy any dip!

Posted by Rashid_G. on 05-26-12 01:29 AM:

Excellent Job!....

__________________
Trade Less

Posted by snowrider on 05-27-12 08:10 AM:

05/27/2012

Comments are welcome!

Posted by snowrider on 05-29-12 09:24 PM:

(More on my blog.) The market took over last Friday's reversal bar which indicated a strongly bearish view was no longer valid. The market is moving higher to find the lower high (of previous high on 05/01/2012) this week. Since we have had a lower low (05/21/2012), we are waiting for the lower high to short the market again. Be patient! The bear run is far from over! DO NOT buy any dip!

Posted by snowrider on 05-30-12 03:57 AM:

(More on my blog)

Posted by ScalperJoe on 05-30-12 06:02 AM:

Thus far the 1,293 level of Wave [I] top has held twice.

The volatility is acting up, and the price action suggests the shorts aren't being allowed to hold their gains beyond intraday, providing an edge for the longs.

Is there a specific target to monitor where you would consider a confirmed reversal to the upside if the proposed lower high fails to breakdown?

Posted by snowrider on 05-30-12 09:35 PM:

Quote from ScalperJoe:

Thus far the 1,293 level of Wave [I] top has held twice.

The volatility is acting up, and the price action suggests the shorts aren't being allowed to hold their gains beyond intraday, providing an edge for the longs.

Is there a specific target to monitor where you would consider a confirmed reversal to the upside if the proposed lower high fails to breakdown?

ScalperJoe - I am rushing to head out now. The market is weakening again today and is very bearish. Could you please take a look My Trade section, for I explained today's market behavior there. Thanks. Will talk to you later.

Posted by snowrider on 05-31-12 09:38 PM:

(More on my blog)
The market set the new low of this week today, closed as a long legged doji (long pin) after volatile washes on both sides. As we know that last week's low was a very critical point in TA perspective (50% and long term up trend channel), it was hard to get it penetrated in the first try. Today's low tested that area as the third try (2nd try - 05/23/2012). There is a Chinese saying that goes like this: Nothing Should Occur More Than Three Times. Therefore, next time if the market wants to test that area, it will break! TLT gapped up again and surged with heavy volume. Out target for TLT is 131 before August or 146 before October. We will start unloading depending on what the momentum says. Again, the stock market's bear run is far from over! DO NOT buy any dip!

Posted by snowrider on 06-01-12 09:23 PM:

(More on my blog)
We have expected this, and it did happen today - the market gapped down with a big hole and closed at day low as a solid black candlestick - very bearish! No more need to be said, and I knew that you would be glad to be in our loop. Even though we miss out the big moves of those bear ETFs this run (we made a big profit last run), we are still happy that our TLT performs very well! It gapped up again and surged with heavy volume. Since the momentum of this TLT upward move has been so strong, our target should focus on reaching 146 by October. Again, the stock market's bear run is far from over! DO NOT buy any dip!

If you haven't read my old posts yet, here is one that might interests you:
(20091031 What Happened in 1987)
Perfect Wave: 20091031 What Happened in 1987

Posted by ScalperJoe on 06-02-12 04:28 AM:

Quote from snowrider:

(More on my blog)
We have expected this, and it did happen today - the market gapped down with a big hole and closed at day low as a solid black candlestick - very bearish!

Good call, today the shorts were able to hold their intraday positions, as there was no recovery whatsoever, very bearish indeed.

Posted by snowrider on 06-03-12 07:43 AM:

06/03/2012

Comments are welcome!
(More on my blog)

Posted by Wide Tailz on 06-04-12 03:52 AM:

The price action in the major indices is very troubling. The Market is reacting very negatively to the latest news. There haven't been any V shaped bounces in a long time.

The Bernanke Put may have expired.

Posted by toc on 06-04-12 10:21 PM:

Quote from Wide Tailz:

The price action in the major indices is very troubling.

At the point of the knife
You never see anyone
How the strong will survive
At the end of their gun

We Run by Strange Advance

Posted by snowrider on 06-04-12 11:16 PM:

Quote from toc:

At the point of the knife
You never see anyone
How the strong will survive
At the end of their gun

We Run by Strange Advance

It's so true that "At the point of the knife You never see anyone".

http://en.wikipedia.org/wiki/Strange_Advance

Posted by toc on 06-05-12 12:10 AM:

Quote from snowrider:

It's so true that "At the point of the knife You never see anyone".

http://en.wikipedia.org/wiki/Strange_Advance

In the S&P, there is lots of 'smart money' in the play and hence trading S&P and variants is pretty much a 'knife fight' in a telephone booth. Having good price 'turning points' helps alot and Elliot Wave is good logic to follow and especially from someone who has figured it out.

Posted by snowrider on 06-07-12 05:10 AM:

06/06/2012

SP update -

Posted by snowrider on 06-10-12 06:26 PM:

06/10/2012

Comments are welcome!

Posted by snowrider on 06-17-12 05:21 AM:

Wave Count

Posted by Wide Tailz on 06-19-12 10:05 PM:

With risk assets on the pop thanks to QE rumors, one would expect gold to be skying.

My spidey senses are picking up a potential bear count for the barbarous relic. If it plunges thru 1520, gold bugs are going to be in serious trouble.

Posted by snowrider on 06-19-12 10:28 PM:

Quote from Wide Tailz:

With risk assets on the pop thanks to QE rumors, one would expect gold to be skying.

My spidey senses are picking up a potential bear count for the barbarous relic. If it plunges thru 1520, gold bugs are going to be in serious trouble.

Wide Tailz - Thanks for sharing! Today GC's close did not look good to me. If GC fails to move above today's high in next two days, its selling pressure could become heavier and heavier.

Posted by Wide Tailz on 06-22-12 12:33 AM:

Bearish Action. Will it continue?

Posted by toc on 06-22-12 01:16 AM:

Major battle brewing at 132.25 area. Tomorrow's open is crucial.

Posted by snowrider on 06-22-12 05:33 AM:

Quote from Wide Tailz:

Bearish Action. Will it continue?

Yes, today's price action was very bearish. If we don't see a reversal bar on Friday to stop the bearish momentum, the market will really start the big wave-[C] to ... maybe 960.

Posted by snowrider on 06-24-12 08:16 PM:

Posted by Wide Tailz on 06-25-12 07:23 AM:

I was googling EW tactics and found a crude oil forecast from Jeffrey Kennedy that went something like this:

Posted by snowrider on 06-26-12 07:07 AM:

Quote from Wide Tailz:

I was googling EW tactics and found a crude oil forecast from Jeffrey Kennedy that went something like this:

Interesting!

Posted by snowrider on 06-28-12 03:37 AM:

Wave Count - SP Intraday

Posted by Wide Tailz on 06-29-12 05:05 AM:

Interesting price action tonight. The hourly is tracing out a megaphone. Grand Supercycle used to harp on this type of pattern.

Posted by snowrider on 07-01-12 08:25 AM:

Quote from Wide Tailz:

Interesting price action tonight. The hourly is tracing out a megaphone. Grand Supercycle used to harp on this type of pattern.

Wide Tailz - Thanks for sharing!

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