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The main indexes DJIA NASDAQ SPX are still in stratospheric levels when one view a 40+ year chart and based on past historical price action it is dangerous to remain long.
It will depend on the specific position the component stks are at in their own wave patterns and counts as to what an investor should do. Those in similar position should be exited or hedged.
FAANG stks the pas 4 weeks have reversed trend and appear to have to go lower even to have a std correction in a bull trend if one were to happen.
INDEXES - there are still distortions in most of the wave patterns which makes it difficult to get at clear count as MTU and others have experienced.
A review of DJIA etc & DAX UKX seem on a prima-facie picture at this time suggests the move from Jan 2018 to Mar 20 is possibly a neg impulse wave and the rally since March a B wave (ALT on larger count a wave 2 if the 2018-20 peaks are end of wave 5 from 1932/42).
IF the run from 2009-18/20 is not 5 from 1932/42 but wave 1 of that 5, then a ABC correction is running still to form corrective wave 2 of that 5 and more upside would follow when 3 starts, but that upside is years away if it happens at all. A 9 or 11 yr advance to 2018/20 requires at least 3 years to correct and needs to work out the number of waves.
The question is, given the height of the mkt currently can we have an extended wave 5 when wave 3 from 1932/42 was also extended (being the period 1942/49 to 1966 or 1974/82 to 2000) ? Answer = not usually. Your comments MTU ???
The steep angle of rise of the mkt the past 2 years is also not sustainable for long. Especially as early 2020 peak was just after 90 yrs from 1929 peak.
Lower high ????? Not sure what you refer to. You mean the Jan 2018 peak ?
The neg seq I ref to is part of the distortion I see. Just like there was in early this year.
You can get a neg impulse seq trading sideways in either a expanding or contracting triangle or flag in some instances. Same with a bottom doing a + impulse. Surely you have seen instances of it ?
The older stks like 3M made peak in J18, its only the others and techs that have kept the indexes aloft.
Its not wise to just rely on the rule that the highest peak or lowest low is the start point of orthodox EW.
The main indexes DJIA NASDAQ SPX are still in stratospheric levels when one view a 40+ year chart and based on past historical price action it is dangerous to remain long.
ReplyDeleteIt will depend on the specific position the component stks are at in their own wave patterns and counts as to what an investor should do. Those in similar position should be exited or hedged.
FAANG stks the pas 4 weeks have reversed trend and appear to have to go lower even to have a std correction in a bull trend if one were to happen.
INDEXES - there are still distortions in most of the wave patterns which makes it difficult to get at clear count as MTU and others have experienced.
ReplyDeleteA review of DJIA etc & DAX UKX seem on a prima-facie picture at this time suggests the move from Jan 2018 to Mar 20 is possibly a neg impulse wave and the rally since March a B wave (ALT on larger count a wave 2 if the 2018-20 peaks are end of wave 5 from 1932/42).
IF the run from 2009-18/20 is not 5 from 1932/42 but wave 1 of that 5, then a ABC correction is running still to form corrective wave 2 of that 5 and more upside would follow when 3 starts, but that upside is years away if it happens at all. A 9 or 11 yr advance to 2018/20 requires at least 3 years to correct and needs to work out the number of waves.
The question is, given the height of the mkt currently can we have an extended wave 5 when wave 3 from 1932/42 was also extended (being the period 1942/49 to 1966 or 1974/82 to 2000) ? Answer = not usually. Your comments MTU ???
The steep angle of rise of the mkt the past 2 years is also not sustainable for long. Especially as early 2020 peak was just after 90 yrs from 1929 peak.
ew guideline says only one extended wave.
Deletebut your frequent mention of a negative sequence (impulse down) starting from a lower high is also new to me
Lower high ????? Not sure what you refer to. You mean the Jan 2018 peak ?
DeleteThe neg seq I ref to is part of the distortion I see. Just like there was in early this year.
You can get a neg impulse seq trading sideways in either a expanding or contracting triangle or flag in some instances. Same with a bottom doing a + impulse. Surely you have seen instances of it ?
The older stks like 3M made peak in J18, its only the others and techs that have kept the indexes aloft.
Its not wise to just rely on the rule that the highest peak or lowest low is the start point of orthodox EW.