We updated the wave count on the DOW but as you can see nothing has changed in our Outlook. Recent weakness stopped right on target at the 38.2% retracement and now we are crawling back up to end the structure that started in November of this year. The upper trendline should be an easy target. Also sometimes a fifth wave will measure 1.618 or 2 times the previous...
Looking at the big picture for the Financials, one have to wonder if they are not building a very powerful Third of Third wave that would propel the index to serious new high in a very short period of time. Long term forecast can be tricky but nevertheless any Ellioticians looking at that chart cannot deny its potential. In other words, the chart sports the right...
We did get another leg down. That was the easy part of forecasting. Now we have to find out if the correction is over and if not what shape it will take. Let's not give too much power to the fact that markets are patterned esp. when we are dealing with consolidation. They can take different shapes. Your guess is as good as mine. But trading with guesses can be...
Waves in most indices are so subdivided that it's getting difficult to know where we are in large wave that started in November 2016. That's why we think it is safer to take it one wave at a time. Right now we do have a pretty clear impulse wave in the Dow ( it's even nicer in the XMI ) from the November low that requires another push-up above recent high that...
The consolidation in the DAX for the past two weeks appears to have taken the shape of a contracting triangle eliminating the wave 2 scenario. Second waves cannot be triangles. Triangles are often an interlude between two impulse waves and in this case that would be wave B of a simple ZigZag. Wave C would be under way with target of 12750 ( C = 0.618 * A ) but...
Yesterday the Naz watched the bullish bandwagon taking off from the pier only to go the other way today reversing lower suggesting we are at least in a consolidation that should bring the index down to 6700 close to the 38.2% retracement and previous small fourth wave, a typical market behavior for a pullback. We are very confident about the consolidation but...
Nothing have changed in our Outlook for the DAX. Actually since its recent low the DAX has been struggling to rally giving us overlapping waves strongly suggesting it is indeed a countertrend rally that should be followed by another down leg. Size and nature of the decline will help us to better forecast what is in the bag for European indices.
We are not sure if current corrective rally is over but to us the picture is quite compelling suggesting as long the November high holds we must expect another leg down that should bring the index close to 3400. A well divided wave down ( The trend ) followed by a choppy advance ( Corrective counter trend ) just make it for a textbook Elliott pattern. That being...
Yesterday decline stopped right on target for a small fourth wave. Maybe that fourth wave will morph into something more complex but the bottom line is we need another leg up making new high to complete the sequence that started in August. Once there, the Nasdaq should enter another correction. In other words, we should see back-and-fill for many weeks to come.
The DAX decided to drop its right shoulder yesterday only to recover as expected. It does not change anything to our analysis suggesting that as long the index stays below its recent high at 13525 we strongly believe we are in for more weakness either in a corrective ZigZag or in a larger impulse wave down part of much larger correction. The jury is out but we do...
The DAX sure looks like it just printed a textbook impulse wave down from its recent high. Well divided and it stopped right at previous chart congestion or a previous fourth wave. A common occurrence. From yesterday bottom expect a rally that has a strong resistance in the 13175-13190 range. A previous fourth wave and the 38.2 retracement. But I won't be...
Regardless if the Russell 2000 makes new high or not, weakness is around the corner. Using the wave principle one can make a case we do have five up from the low we saw in early 2016. Once you can count to 5 just expect a correction. We just don't know how deep of a correction we will have. To bolster our confidence in our topping view are the weak internals of...
Last time we updated BA we were seeing the stock as topping but instead it took off on us opening the door for two potential scenarios. Both bullish. Either we are correcting the recent parabolic advance before printing the final wave up or there's two down up sequences left before BA comes back to earth. The right look and common sense would suggest to label it...
We have been bullish on Fedex for quite a while but now we are taking money off the table and walking away from it. The chart just does not look good. Actually I should say it does look good if you use the Ellliot waves because one can make a case since the 2009 low we do have a clear five waves up indicating somekind of top is at hand. We might chop our way...
The NYA seems to work its way higher in a nice impulse wave that does not seem to be over. At least two more down-up sequences before we get somekind of top. Actually current advance could even subdivide even more driving the bears totally insane. Markets are patterned but labels come after.... Nevertheless, long term we are not in a topping mode as the McClellan...
American Express is making quite a nice recovery since its 2016 low and it appears to be unfolding as an impulse wave requiring one more down-up sequence before being completed. Once over a larger decline will ensue. Magnitude unknown.
Lately we have been warning you that markets are getting toppy and ready to head south. But what next ? We don't know and don't expect me to tell you there's a crash around the corner. Actually if we look at the chart of Disney it might telling us that no THE TOP is not there yet as it seems to be moving sideways in a large bullish triangle. In other words not...
We have been bullish on Boeing for a while and now we believe it is time to jump off the bandwagon. Again with most sentiment indicators flashing caution one have to label patterns in a more bearish way. It is still possible BA will decline a bit and push up one more time but as far we are concerned the buyers are pushing their luck right here right now.