Thursday, May 20, 2010

Wave [ii] Down Should Be Nearing Completion

I originally expected that wave [ii] down would extend out in time with (b) of [ii] moving higher over the next few days. It appears that the market had other ideas as wave [ii] down is completing sooner.

For the Qs:

Wave (c) of [ii] = (a) of [ii] at 45.11. This target has been hit and exceeded.

Wave (c) of [ii] = 1.382 x (a) of [ii] at 44.17.

Wave (c) of [ii] = 1.618 x (a) of [ii] at 43.58.

Note that the lowest expected target for (c) is still above the 2/5 low. If we close at the lows today, then I expect that the lower target will be hit.

So far, as bad as it feels, all of the action can be explained as a 2nd wave. However, we are fast approaching the uncle point. Even then, the market should not head straight down, but should have some sharp rallies where stocks can be sold.

No comments: