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Strategies & Market Trends : Longer-Term Market Trends -- Ignore unavailable to you. Want to Upgrade?

To: NOW who wrote (530)	5/16/2008 11:38:42 PM
From: skinowski	Read Replies (3) \| Respond to of 3209

I am of the same opinion as Allan - such series of 1's and 2's are likely to mislead and to turn out to be something different. I submit that there is yet another possibility - the decline in $HUI may be an evolving Leading Diagonal. Since presently the putative Wave 3 is shorter than W1, the 5th would have to be rather small. We would only be able to tell retroactively that it was an LD - after the move would be completed. This brings up a question - Why bother with formations which can only be recognized once they are finished? The answer lies in the high predictive value of such an impulsive structure -- the odds would be high that the attempted rally would fail, and the decline would resume. But, indeed, for now it seems fairly likely that the decline was corrective - unless proven otherwise.

To: NOW who wrote (530)	5/17/2008 1:31:28 PM
From: skinowski	Read Replies (1) \| Respond to of 3209

PS - Another $HUI (GLD) comment wrt to your chart: Every time one sees a three-waver following a top (bottom) it's worth considering the possibility of an evolving triangle. In that case, the index may go on up and down for several more months until it completes a triangle. The resolution would typically be bullish. Another formation Gold seems to like are (flattish) double zigzag corrections. That would also be bullish. Of course, as mentioned, a series of 1's and 2's down would be very bearish, as would be a leading Diagonal. I will put up a trade on gold, but only after this conundrum shows its true face. The one version least helpful to me would be if the entire correction is over, and the rally is on. In that case I'd have to chase price, which I don't like to do.