Corrective patterns can fall into a number of categoriesThis one falls into a Zig Zag 5 - 3 - 5
That means IF the first wave breaks down into 5 waves, that is never the end of the correction, and gives a clear clue as to the nature of the zig zag in progress.
This chart shows me the WAVE from Oct10 to March 10/17 was broken down into 5 waves leading to the completion of wave "A" on March 10th. The 110 tr day count to the 17th was already pointed out in a previous discussion. oct 10 = 13 x 8 segments = 104 days = March 10
THUS we should expect a 3 wave structure in the next wave called "B" which we are experiencing right now and imo, should end on June 6th and or 9th.
Since June 7th does appear to have some significant positive harmonic grouping of astro events, imo, that might mark the top of what would be labelled as wave "B"
March 10 + 55 = june 7th
June 9th = 21 x 8 = 168 tr days
June 9 to nov 4th = 110 dys
Total = 288 which is 2 x 144
13 months x 22 days ave = 286
Overview
Wave "A" = 5 internal waves and took 5 months
Wave "B" = 3 internal waves and should take 3months
Wave "C"= 5 internal waves and should take 5 months
Wave "A" was spx loss of 300 pts from 1576 to 1276
Wave "a" of "B" might have topped on April18th at 1390, a rebound of 114 pts or fibo 38.2%
wave 'b' of "B" can drop back to a fibo level less than the previous low or as low or lower depending on various factors which only the market knows and will reveal shortly. My guess is April 28th
Wave c of "B" could reach as high as 1410 to 1425, and thats where I think June9th comes in to play.
Wave "C" should break into 5 waves as similar to Wave "A" but there are some differences. "C" waves are considered the NASTY guys- Why? you ask?
This wave should take out a fibo multiple of wave "A" usually x 1.618 = 458 pts, but that would be subtracted from 1400 giving us a closing value in Nov of spx 950.
The graph above shows OBV in the lower chart, and imo is showing inherent weakness as it is only holding onto moderate gains from the 2006 lows
Im then expecting June7th to July 25th to take out at least and equal loss to wave 1 of "A" which was 165 pts from 1576 to 1410 on Nov26th. should also = a 32 day segment.
Hope this clarifies things for you.
Best Wises
Jay
1 comment:
Hi Gerald--I like your blog
My suspicion is that we are in the same corrective wave that started at the JANUARY Low--tip off being that DJIA and NYSE held above these lows in March
If that turns out to be the case, its 3months down into Jan then 3mths countertrend into late April/early May-and to then be followed by 1-3mths dn to maybe a lower low
personally, i suspect the whole thing will turn out to be a Double ZZ abc to jan low--x to late april/early may high then abc dn again
who knows--Gary
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