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

To: bobby beara who wrote (23400)	8/5/1998 9:30:00 PM
From: RWS	Read Replies (1) \| Respond to of 94695

Indexes hit important support levels today. Many technical indicators are extremely oversold and a short term rally is in the cards. Don't get carried away with bearish fervor. EW was useful to my trading today. Didn't know whether rally from the morning dip would be the real thing or another head fake. New lows and the rising TRIN indicated a fake. The rally from the morning low at SPX 1063 was a classic Elliott corrective wave consisting of three waves, two up and one intervening dip, with the two up waves subdividing into five steps - a 'zigzag.' Another down-up series would have made it a five wave impulse and a buy. But the down-up following the zigzag made a lower low and a lower high signalling a new impulse wave down and a sell at SPX 1083. Bought my puts there and sold them near the bottom as I tightened my stops as the afternoon plummet picked up speed. The overall wave down from the top has put in a big 'zigzag' configuration which should be followed now by a rally. How it plays out in the next week will tell us a lot about how high the rally will go. RWS