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Elliott Wave Analysis of the Shanghai Composite Index (SSE) by Sid from ElliottWavePredictions.com

 Shanghai Composite Index  Comments Off on Elliott Wave Analysis of the Shanghai Composite Index (SSE) by Sid from ElliottWavePredictions.com
Sep 082012
 

Elliott Wave Analysis of the Shanghai Composite Index (SSE) by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.

The Shanghai composite Index is showing a number of technical reasons why it may have bottomed last week. For one thing, Wave C black appears to have turned after reaching exact equality with wave A black, a very common relationship. Also, when using Elliott’s triangle measuring technique, the thrust from the blue wave 4 triangle appears to have bounced exactly off of the thrust target exactly to the tick. Additionally, last week’s candle spanned nearly a 6% gain from low to high, and is a clear weekly bullish engulfing candle. If the long term triangle scenario pictured above is correct, the Shanghai Composite is now due for a significant bull run, with a projected gain of over 40% from Wednesday’s low, the eventual upside target being the .618 retracement of the entirety of Wave C (burgundy) of the triangle.

This development could easily kindle profit-taking in US and European equities, as the smart money reinvests portions of their profits from mature bull markets into instruments with greater potential to rally from significantly oversold junctures.

Sid
http://elliottwavepre.wpengine.com

Elliott Wave Analysis of the Dow Jones Industrial Average DJIA by Sid from ElliottWavePredictions.com

 Dow Jones Industrial Average, EUR/USD  Comments Off on Elliott Wave Analysis of the Dow Jones Industrial Average DJIA by Sid from ElliottWavePredictions.com
Oct 242011
 

Elliott Wave Analysis of the Dow Jones Industrial Average DJIA by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.

I’m seeing a possible 4th wave triangle in several US equity correlated items (like the AUD/USD currency pair, for instance), with the terminal upward thrust out of the triangle either complete, or nearly so. Also, the sizeable rally from October 4 in equities appears to be running out of steam, as indicated by the nearly formed 120 minute MACD divergence. And although my short term wave count for the Euro posted earlier today invalidated by 3 pips, the pair bounced off the 1.3940 resistance area yet again (1.3937 is the extreme of wave 4 of one lesser degree), so things are looking a bit “toppy” here, in my opinion. I wouldn’t count out the possibility of a small up-gap to a new high at tomorrow’s NY open, but if that does occur, it could be an exhaustion gap, which would be confirmed if quickly followed by aggressive selling.

One last note: According to SentimenTrader.com, short term bullish sentiment turned to the extreme today, which generally portends a short-term top. Intermediate sentiment isn’t quite bullish enough yet to expect a major turn, though. This supports my main wave count, which expects equities (short term) to move back toward the lower half of the Aug-Oct range starting quite soon, followed by a year-end seasonal rally, which is likely to mark the end of this bear-market correction. I continue to expect the year-end rally to be followed by a terrible 2012 in the markets.

Sid
http://elliottwavepre.wpengine.com

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