Thread: Elliott Wave Trading Discussion

Originally Posted by American Trader

Ask, and you shall receive. The daily S&P chart is the most bearish count I have, obviously. The alternate would have it as an A-B-C correction, with us in wave C right now.

The momentum indicators, combined with weak breadth on these down days, tell me that the major indexes still have much further to fall.

I know this is a forex forum so I guess we can't too sidetracked here. But I welcome any comments, as well as the fundamental aspect as to why the JPY doesn't appear affected by this recent decline in stocks.

American-T

AT;

I count the S&P as an ABC especially on the monthly chart. It is confirmed on the weekly. The resulting the target A=C is 1120. That target is confirmed by the P&F chart target 1140 not locked.

As for the $YEN, the Japanese economy is worsening due in part to the US economy. Exporter sales largely auto, are declining. Additionally, rumor has it Asian Central banks are buying $.

Good Luck.

Here's my take on the EUR/USD. I am in the Mike camp and am looking for a move lower. I also like Tex's count but, 5350 is below the up trend and thus puts the bottom of the daily down channel in play with an initial target of 5181 (A=C.)



Good Luck.

Originally Posted by Big Mike

Sometimes i have a scary thought that we are the Enlightened Ones. And it is one scary thought. The rest of the happy crowd is marching to the slAUGHTER with wall streets of the world playing the drums.
Let's face it; the japanese crosses haven't unwound yet (in fact, still the opposite, still going up or stabilizing) simply because the so-called experts don't get it. They are still drunk on the euphoria of the recent market correction (mid-march - end of may). They don't believe that this is the Real Deal.
Maybe bob prechter was right after all saying that the bear will arrive in the middle of the night and nobody will notice. When they notice, $-*t will hit the fan, colloquially speaking. But it will be too late. The whole crowd will run in a hurry to the exit door. This is when the indices will start dropping like niagara falls.
Mike

Yes, there is a blind optimism around. I think a lot of has to do the fact that really no one alive today was around and following the financial markets during the 1929 Great Depression, and so everyone is of the thought that if you buy stocks and hold them for the long term they'll continue to go up. Afterall, that's what they've done the past 80 years, which is the span most investors have lived their lives through. The difference is that this recession seems different. It's much more severe as housing, personal wealth, credit inflation, employment, etc. etc. appear extremely weak with no end in sight and now the credit markets are extremely shaken up and there's no solution in sight. And now the Fed only has 200 basis points to play with and it appears the market is collapsing again. What will happen when they get to 0%? Aside from that, they're now focused on inflation so the perception is that they won't even cut rates anymore anyway. I think we all know that the powers at be are not telling the public a fraction of how bad things really are. But for the savvy investor, the one who's not biased by blind optimism from an 80 year bull market, it's quite clear that this will likely be a very severe recession, and perhaps the most severe since the Great Depression.

The problem us bears have is that we're fighting the power players. Both the government and Wall Street have heavy interest in the market going up, and so they can lie, cheat, steal, abuse tax money, invent new laws and policies, and do whatever they want to artificially hold this market up. But the collapse is imminent, and the longer we wait the harder it will fall.

Interesting point you made on the JPY. I think the USD/JPY has very little if any carry trade left in it, but I still thought it would be tied to other pairs like the euro and cable which would affect the USD/JPY. But the JPY is weakening. I don't understand that aspect of it.

Well, as I said over the weekend, everything's set up for an interesting week, and so far it hasn't let us down. With retail sales and inflation data coming out Thursday and Friday, I think the excitement will continue.

I've convinced my family to convert all their long term stock positions into cash (T-Bills and savings accounts) until the dust clears and a bullish picture returns. CASH IS KING!! And it's actually well outperformed all the major indexes over the past 8 years.

American-T

Here's my daily chart. I am leaning toward a double 3 for the correction. Therefore wave 4 of 1 less degree (5274) should be given consideration and watched closely as a break would certainly bring into play the 4941 to 4300 area as a target.

Good Luck.

Originally Posted by Big Mike

Hello guys
I am posting the chart for nasdaq.
Likely, we will get small reprieve soon, but the correction will be shallow, if consider the FEROCITY of this decline. We are dropping at 1 or 2% per day, pretty soon at this rate we will reach ZERO, lol.

Italm, if you are looking, i would say that this is not a B wave, wouldn't you?

I feel sorry for all those poor souls who have fallen innocent victims of wall street mantra "buy, buy, buy" and "stox always go up". many seniors will see their entire nest egg evaporate in a hurry and then what? Fliping burgers at McD for the rest of life? even these McJobs will disappear soon.
Mike

Hey Mike,
Unfortunately, the more I see it, the worst it looks...lol!. Id say its likely wave I of 3 comming down and even that first wave is just starting to break down in its own wave iii. Ouch! This could get nasty. I still want to see what happens tommorrow for confirmation but looking at the Yen pairs, ID say the fun is just begining.

Hi guys,

I was traveling all day Wednesday. Just able to hook up the laptop and check-in. Looks like I missed quite a day! Unfortunately, I'll be away until next Thursday. The best I can do is a late night check in to see what's up.

Here is a chart of the E-Mini S&P 500 as of about 11:30 PM EDST. To tell you the truth I'm not sure of the count. :-) All I know is it's going lower. For how long I don't know. I agree with AT and a few others that if 12,000 is taken out we may be in real trouble.

I guess gold is marking time before it starts the next leg down and the euro looks comfortable in the mid 1.55's.

Good luck to all this week. I'll be checking in late at night tomorrow and reading everyone's posts with a lot of enthusiasm. :-)

Euro/Usd
( 10 min bars )
Here is a look at today's Euro Wave-count

Here is a look at what may be occurring ......
-----------------------------------------------
Only a Probability ! ....... Not Cast in Stone !
-------------------------------------------------
/////////////////////////////////////////////////////////

Originally Posted by italm31

Hey Mike,
Unfortunately, the more I see it, the worst it looks...lol!. Id say its likely wave I of 3 comming down and even that first wave is just starting to break down in its own wave iii. Ouch! This could get nasty. I still want to see what happens tommorrow for confirmation but looking at the Yen pairs, ID say the fun is just begining.

There is a famous chinese curse "I wish for you to live in interesting times".
I am afraid that it might happen to us all. Batten the hatches, guys. Major storm is approaching.
Now, my chart for nasdaq is different than similar chart for S&P and DOW. But, hey, they all sit in the same boat. In all fairness, they might differ in details of wave formation, but not much in the direction. They all go down the slope, each at a slightly different rate. You are absolutely right; the big fun hasn't started yet. And, remember, what we are seeing is still a prelude to the real gravity fall.
If anything, the rate will accelerate as we progress down the slippery slope.
Just to put it into bigger perspective: Asian markets dropped today another 2% each. It almost looks like a stripping contest; who can peel off more cloth faster in a shortest time.
Mike

Originally Posted by diver

Hi guys,

I was traveling all day Wednesday. Just able to hook up the laptop and check-in. Looks like I missed quite a day! Unfortunately, I'll be away until next Thursday. The best I can do is a late night check in to see what's up.

Here is a chart of the E-Mini S&P 500 as of about 11:30 PM EDST. To tell you the truth I'm not sure of the count. :-) All I know is it's going lower. For how long I don't know. I agree with AT and a few others that if 12,000 is taken out we may be in real trouble.

I guess gold is marking time before it starts the next leg down and the euro looks comfortable in the mid 1.55's.

Good luck to all this week. I'll be checking in late at night tomorrow and reading everyone's posts with a lot of enthusiasm. :-)

Hey Diver,
Consider yourself lucky. Fear will dominate the markets in the next few months if our count is right. I don't think you want any part of that. I think the best strategy (FOR ME) is to stay away from day trading and just see what happened at closing time. That way, l will have time to think things out logically and with as little emotion as possible. Markets are closed. Just look what transpired and try and decipher where you are in the trend. Place your orders and if your hit, your hit.

"And right here let me say one thing: After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was my thinking that made the big money for me. It always was my sitting. Got that?"
Jesse Livermore
Reminiscences of a Stock Market Operator

I have to say this, I don't like conspiracy theories, i do not believe in them and , despite overwhelming evidence, i am still trying to maintain that the market is not being manipulated.
But, it almost appears to me that there are soem powerful forces right now trying to shore up the dolar.
You can call it central bankers, you can call it fear, you can call it flight to safety, you can call it intervention, you can call it reduction of current account deficit or any other fancy name.
No matter the name; we are witnessing a phenomenon that the dollar will start going up. Even you can see that on TV, even the biggest idiots on CNBC repeat the same script.
In short, i am trying to say that we need to be careful, we need to be vigilant, because it looks like the USD starts to rise despite all odds.
It is still a temporary phenomenon, there is still some USD weakness ahead, but in the immediate future I would be careful to bet against the USD.

The only exception might be CHF and JPY, which are consider even less risky than the USD.
Mike

Originally Posted by marketwavez2

Euro/Usd
( 10 min bars )
Here is a look at today's Euro Wave-count

Here is a look at what may be occurring ......
-----------------------------------------------
Only a Probability ! ....... Not Cast in Stone !
-------------------------------------------------
/////////////////////////////////////////////////////////

Well done Marketwavez2. went as low as 1.5392

EG

Hey Diver,
I was looking again at that chart you posted for the Eur/Usd daily (post #8228) with the triangle count - looks like wave D and wave E have completed, the recent low (W:E low) just bouncing now off that lower upward sloping line defining the triangle (sorry I haven't yet figured out how to post charts) - that's pretty impressive! If so, looks like we should have a strong move up now for the euro. Supported by: those stop-running spikes (Hammer, or Kangaroo Tail is the name I like best) down through 1.5400.

US stock indices: S&P 500 bounced up to the 61.8% retracement of yesterday's 5 wave move down, but looks like now starting another move down. (Correction may be finished - can count a-b-c up - or could just be W:A of an a-b-c)
If the Fed are trying to talk up the USD by hinting about interest rate rises, but then fail to deliver, then that is likely to send the eur/usd up again. On the other hand, if they keep on escalating the hints in any sort of believable way, that is likely to send stocks down over the cliff. These 2 scenarios are not mutually exclusive - but may just keep up the pressure for more wild swings in all markets.
My 2c worth!

Originally Posted by American Trader

Yes, there is a blind optimism around. I think a lot of has to do the fact that really no one alive today was around and following the financial markets during the 1929 Great Depression, and so everyone is of the thought that if you buy stocks and hold them for the long term they'll continue to go up. Afterall, that's what they've done the past 80 years, which is the span most investors have lived their lives through. The difference is that this recession seems different. It's much more severe as housing, personal wealth, credit inflation, employment, etc. etc. appear extremely weak with no end in sight and now the credit markets are extremely shaken up and there's no solution in sight. And now the Fed only has 200 basis points to play with and it appears the market is collapsing again. What will happen when they get to 0%? Aside from that, they're now focused on inflation so the perception is that they won't even cut rates anymore anyway. I think we all know that the powers at be are not telling the public a fraction of how bad things really are. But for the savvy investor, the one who's not biased by blind optimism from an 80 year bull market, it's quite clear that this will likely be a very severe recession, and perhaps the most severe since the Great Depression.

The problem us bears have is that we're fighting the power players. Both the government and Wall Street have heavy interest in the market going up, and so they can lie, cheat, steal, abuse tax money, invent new laws and policies, and do whatever they want to artificially hold this market up. But the collapse is imminent, and the longer we wait the harder it will fall.

Interesting point you made on the JPY. I think the USD/JPY has very little if any carry trade left in it, but I still thought it would be tied to other pairs like the euro and cable which would affect the USD/JPY. But the JPY is weakening. I don't understand that aspect of it.

Well, as I said over the weekend, everything's set up for an interesting week, and so far it hasn't let us down. With retail sales and inflation data coming out Thursday and Friday, I think the excitement will continue.

I've convinced my family to convert all their long term stock positions into cash (T-Bills and savings accounts) until the dust clears and a bullish picture returns. CASH IS KING!! And it's actually well outperformed all the major indexes over the past 8 years.

American-T

You are optimistic when you say that nobody was is around anymore, who can stil remember the Grreat Depression. Heck, most brokers do not even remember nasdaq crash in march 2000; the smart brokers made tons of money and retired and the stupid ones ended up behind bars. Life span of a wall street broker is very short.
And the general public suffers from amnesia and gullibility combined with blind trust in what they hear on CNBC. We all know, what will happen to them.
The way I see it now, is that we will see severe deflation in asset class. Houses, cars, SUV's will all go down in price (it is happenning now since one year, but will last few more years), combined with huge inflation in costs, such as food, energy, medical services. So, it is a double whammy. It will cost lots just to survive and there will be very little left for everything else, including investments. So, people will be taking money out of 401k, RSP and other mutual funds, which will severely damage the stock market.

As i mentioned before, i can see now an orchestrated effort to shore up the dollar in order to reduce energy cost/ break the back of oil. In my opinion, the tide is changing now in favour of the USD. It will be an intermediate phenomenon that will last few months, afterwards dollar will drop again.
Mike

Originally Posted by Big Mike

I have to say this, I don't like conspiracy theories, i do not believe in them and , despite overwhelming evidence, i am still trying to maintain that the market is not being manipulated.
But, it almost appears to me that there are soem powerful forces right now trying to shore up the dolar.
You can call it central bankers, you can call it fear, you can call it flight to safety, you can call it intervention, you can call it reduction of current account deficit or any other fancy name.
No matter the name; we are witnessing a phenomenon that the dollar will start going up. Even you can see that on TV, even the biggest idiots on CNBC repeat the same script.
In short, i am trying to say that we need to be careful, we need to be vigilant, because it looks like the USD starts to rise despite all odds.
It is still a temporary phenomenon, there is still some USD weakness ahead, but in the immediate future I would be careful to bet against the USD.

The only exception might be CHF and JPY, which are consider even less risky than the USD.
Mike

Yeah, I don't understand it. And therefore I shouldn't be trading it. My position size is now very small in forex going back a few weeks ago when the dollar kept rising and rising. I was stopped out of my short USD/JPY position. I still have a long GBP/USD position but the decline last night took out the beginning of that clear wave rally. The pair appears to be in a very large wave B, so I guess chaos and sloppiness should reign in the movement. But I'm not entering any new money into forex anytime soon.

STOCK MARKET

The stock market obviously popped today, it took two VIX short term buy signals to finally push it. Breadth is solid on this move so it should last all day and could excelerate by the end of the day. But like we saw last Thursday, rallies in this bear market can be sharp, fierce and on strong breadth and then get completely reversed heavily the next day (like last Friday). Once I can count a 3 wave rise I'll start looking for a return to selling. Short term indicators are oversold, volume has decreased the past couple days and with the strong breadth today it appears the bears are taking a breather.

PRECIOUS METALS

With the dollar rally gold and silver dropped big today. A break of $850 in gold should open the door to $800 soon. There's a wave count that has gold undergoing a wave iii of (iii) of 3. So if that's correct, we should see nothing but selling for the days to come. It also would mean dollar rally continuation.

Sorry no charts this morning, no time. But if anyone would like to comment, please do.

American-T