Monday, July 27, 2009
Clear Pattern In The Utility Average
The Dow Utility Average gets little press, but the elliott wave pattern is pretty clear, at least down to the March low. The decline from the Jan 08 high occurred in a very clear 5 waves and the swing highs and lows were coincident with the broader market turning points. In general, we would expect that the countertrend rally would retrace 50% to 62% of the prior decline. This turns out to be very close to the zone of the 4th wave of lesser degree, the 4th wave in intermediate wave 3 down, which is often the area that retracements terminate. The DJ15 Utility Average may be a good coincident indicator for the broader averages.
Posted by R. Craig Pritchard at 5:24 PM