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

To: jef saunders who wrote (25424)	8/28/1998 12:34:00 AM
From: Rogue French Trader	Read Replies (1) \| Respond to of 94695

I agree with you. I think we have 5 of 3 to finish tomorrow AM. Where are you looking to get out? (If you're not holding puts for the wave 4 bounce). I'm thinking 1030 or so.

To: jef saunders who wrote (25424)	8/28/1998 3:30:00 AM
From: Bull RidaH	Read Replies (1) \| Respond to of 94695

Jef, I wouldn't be too anxious to cover shorts just yet. We have multiple patterns that project to and call for an immediate move to the 1012SPX/8000Dow area, so any short covering before then has to be done with the understanding that there is alot of risk in being left in the dust. One of the patterns that projects to 1012 is our old friend, the Diamond pattern. Many will remember that pattern cropped up in early April, giving clear indications of a bearish reversal at 1141 on April 6th. Well this one is just as clear, just as large, and just as reliable for a bullish reversal from the 1012 area. The size and duration of the reversal is questionable at this time, but I have to expect at least 3 days and 30+ S&P points. I've got us just finishing up the 3rd wave down from the 5 wave set that began from Tuesday's high. I expect a 4th wave bounce in the morning, but am afraid it will probably be muted, and not provide significantly higher prices to short into. The most likely resistance to further up should come in around 1040, with an outside chance of visiting 1050, but I wouldn't bet on it. Once the 4th wave rebound/sideways action ends sometime tomorrow, we'll be ready for the 5th wave down in this 5 wave set, which I strongly suspect will take us to 1012/8000 by early next week. I believe this is only the first of three 5 wave sets that will pummel the market over the next 3 weeks (i.e. an extended 5th wave from Tuesday's beginning, with this 1st 5 waver down only being 1 of 5). The ensuing bounce/rally from 1012 could last from 3 to 8 days, potentially propping the market up into the Friday before Labor day. But after Labor Day, we should see further devastating declines that last right into expiration, potentially taking out January's lows. Dow 7300 is a very good bet by expiration in my opinion. Regards, David