"All human activities have three distinctive features: pattern, time and ratio - all of which observe the Fibonacci Summation Series" (R.N. Elliott - "Nature's Law - the Secret of the Universe" - 1946)

Saturday, May 18, 2013

Elliott Wave Analysis of several Stock Market Indexes, GOLD and OIL

Stock Market Indexes

 DJIA is in a very strong bullish corrective pattern.


Preferred scenario; we should be in wave c minor of (y) Intermediate of [Y] Primary of D Cycle;
the first top target is the intersection of the price with the uptrendline of the triangular pattern, close to 16.400 area between August and September , then is likely a reversal and the start of a new bear market Cycle;
Alternate scenario; super bullish: we are in the  Alt:(3) Intermediate of Alt:[3] of Alt:I in the new SuperCycle Bull Market Alt:[V]


 NASDAQ has accelerated breaking the strong resistence at 2,850 that for months stopped its upward trend and appears in wave 3 of 5 minor of (c) Intermediate; next target 3.300.

German DAX
pr we could be in the final intermediate wave (z) of [Y] of D Cycle; it's very difficult set a target but above 9,000 will prevail the alternate scenario that consider the early stage of a new SuperCycle Bull Market Alt:[V], so we would be in the Alt:(3) of Alt:[1] Alt:I Cycle.

 London FTSE-100 appears in the early stage of an extension like wave  (3) Intermediate or Alt:(5) of [C] Primary and has the rhythm to break the top at 6,950.

 Zurich SMI is in wave 5 minor of (3) of [C] Primary.



should be close to a top of minute degree, that is at the end of wave  x minor of (b)/(x) Intermediate of [C]/[Y] Primary.


JAPAN NIKKEI; It was years since I could not see a bull market of such power and persistence in a stock market of an industrialized country; in six months the index has risen by almost 80% and the impulse is so strong that it is difficult even to count this properly (one lost his hand due to the rarity of the event ...)

In a previous post I represented the potential bullish of Nikkei but frankly, I would have expected at least a sideways congestion to catch his breath (and enter in long position).
None of that, the index has even accelerated.

However I think that the SuperCycle bear market started in 1990 does not seem yet finished  and this great bounce is only the completion of the wave B Cycle; the first doubt on this hypothesis is due to the break, this  week, of  long-term downtrendline (dashed red on weekly chart) , a classic sign of change of trendbut in this case this event has a value, say questionable, because the line only connects two tops.
Preferred count: we are in 3 minor extended of (c) Intermediate, so there is the change of another rise  at least up to the 18,300 then about 20% above current levels.
Alternate count: if wave Alt:(b) was completed like a triangle pattern, we could be in the Alt:3 of 1 minor wave, so the bullish target is even higher.


GOLD is in a wave IV Cycle bear market, still far from the end.

CRUDE OIL is in a almost incomprehensible congestion;  we could be in the downward wave [C] or in a new bull market of primary degree;  sooner or later it will break definitively upward or downward, but now the best strategy is to stay out.

The value of the Crude Oil chart, however, is not so much in the opportunity of trading but in the  intermarket signal that it transmits: if the last Cycle uptrend of the stock markets were actually driven by the real economy, and then by the steady increase demand and production, also industrial, the Oil, which would be used as a raw material with increasing insistence,  should not be close to the top or , at least, much higher?

Have a great weekend!


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