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

To: William H Huebl who wrote (70618)	4/24/2005 12:40:25 PM
From: Real Man	Read Replies (1) \| Respond to of 94695

Yes, a Fib. move up retracing around 61.8% of the March-April fall for the major indices appears likely. It should probably last 2 months or so. This will put the broken LT uptrend to 61.8% retracement level. If such a scenario were to materialize, we would re-test the broken trend, AND do a Fib. 61.8% move up. On the other hand, Given the sentiment in the past 3 years, and the fact that the sentiment at Oct. 2002 bottom was not bearish (!!!), I would not bet on it. Since the trend up has been broken, the LT trend is now down. This is the second wave of the great bear market. Typically, such waves are fast, and I would not joke (go long) with it, especially given the broken triangle pattern, which sets the target for the 1-st wave down to October 2002 lows. Looking at the DOW chart, while it is tempting to assume that the triangle has started in 2004, it actually goes all the way back to January 2002. This makes the target of the first wave down not 2004 lows, but rather 2002 lows. We are now in a correctional wave (iv) of (a) of (A) of III. Wave (v) of (a) is likely to end at 9750 level for the DOW, and 2004 lows for the other indices. I would not count on large bounces. In other words, I think, the current impulsive move from early March lacks the ending wave (v), which should probably be complete by the early May or so. I expect wave (A) of III to be completed some time in October, which will then start wave (B) of III into Spring 2006. On the other hand, given the extremely bullish sentiment during the wave II rally from 2002 lows to 2005 highs, I would not be surprised if wave (A) would be of very abrupt nature