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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: pater tenebrarum who wrote (41125)	6/28/1999 8:21:00 PM
From: Benkea	Respond to of 94695

FWIW: The Bottom Line The Elliott Wave pattern in the [Dow Industrials] is clear, a contracting triangle (see chart). What is not so clear is which direction prices will decide to thrust once the triangle ends. Our stance is bearish, based on our recent discussion of the weak technical underpinning of the blue-chip averages. Thus I believe the higher probability scenario is that the thrust will be lower, bottoming when the next 9-month cycle bottoms in July. Our main forecasting tool is the Elliott Wave Principle, and its main benefit can be seen at junctures such as this. The reason is because the pattern allows us to identify very specific parameters for judging market action. For instance, even though we are bearish we know from the development of the triangle that any push above 10889 (June 18 high) means that prices are rallying to new highs, not thrusting lower as we surmise. So we have a specific risk level for our stance. We are able to confidently maintain a bearish outlook toward prices, but only so long as 10889 remains intact. If the index rallies above there, the pattern tells us that we must change our stance to bullish. Near term, the rise from last Thursday's 10471 low is wave E of the triangle. Thus far it has traced out three waves up to near today's 10693 high, which is required of the pattern. So we should be on the alert for signs of a down turn. A break of 10538 (small wave B low) is the first indication that the triangle is over and a thrust lower is underway. Falling beneath 10471 should confirm it and open the door to the next support of 10184. Stronger support is in the 9853-9990 area and this likely will be tested. If at anytime the index rallies above 10889, then we know the triangle pattern was a bullish one (a fourth wave) and prices are rallying to modest new highs over the next week or so before topping. So our parameters tonight are clear cut and we will act accordingly. The Hourly Elliott Count 10460 – 5/27 – 13:30 -----------A 10909 – 6/07 – 15:30 ------[a] 10478 – 6/11 – 13:30 ------ 10860 – 6/17 – 14:30 ------[c] 10498 – 6/24 – 12:30 ------[d] 10639 – 6/25 – 09:30 ------End of First Three 10553 – 6/25 – 15:30-------(x) 10672 – 6/28 – 10:30-------Start of Second Three-maybe? [e] of B forming? We seem to be in the Double Three I wanted but please see the ST Update. I can't improve on his comments. Ç§ boards.fool.com