February 18, 2009:
Wave 4 is unfolding, as we've suspected, as a 4th wave triangle formation. This is an A-B-C-D-E sideways formation that occurs, by Elliott Wave definition, in the 4th wave position. So, anytime you've got a 4th wave, you tend to be on the lookout for a triangle. And, in this case, this is wht we've got, and it's very well defined.
We are now in Wave E, which should last anywhere from 3-5 trading days, 5 days max as Wave E can not last longer than Wave D, and then the Nasdaq Composite will begin a very large leg down. This will be a move to significantly lower lows, however, it will come with less downside momentum (intensity) than we saw at the peak in downside momentum that the nasdaq composite displayed in October 2008. We will experience a price/momentum divergence. This will be a new low that be bought with much more confidence than we've seen to date.
Wave 4 Subdivisions:
Wave A:
11/21/08 to 01/06/09
1295.49 to 1665.63
370.14 pts or 22.22%
29 Trading Days
Wave B:
01/06/09 to 01/23/09
1665.63 to 1434.08
231.55 pts or 13.9%
12 Trading Days
Wave C:
01/23/09 to 02/10/09
1434.08 to 1598.50
164.42 Pts or 10.28%
12 Trading Days
Wave D:
02/10/09 to 02/18/09
1598.50 to 1454.46
144.05 pts or 9.01%
5 Trading Days
Current Wave 4 Count
Longer Term Wave Count (not updated since Febraury 8, 2009)
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