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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (25817)	10/28/1998 10:20:00 PM
From: Gary Burton	Read Replies (1) \| Respond to of 70976

Gottfried--In Elliott parlance, a 5 Wave advance is a wave with a motive, a 3 wave is only a partial retracment after which the original trend reassurts itself. So, a motive wave (called an impulse) is what we want to see to establish a trend that will last awhile. This is what AMAT is in the process of completing off the 21.56 low. So, it is very good news.----But, one doesn't buy at near the end of the first motive wave. Instead, wait for a partial retracement. AMAT is currently near the end of wave 1, to followed by a wave 2 down which usually retraces 50%-62% of wave 1 since few believe the staying power and the news is all bad. Once wave 2 bottoms, a powerful wave 3 advance will then ensue which will usually go 1.5-3.0x the length of wave 1. Everyone and his brother will be on this wave. So, the time to buy is at the bottom of wave 2, not near the top of wave 1. In AMAT's case, wave 1 may peak out in the 35-37 area and then start down. A 50% retracement from say 36.50 peak would target 29. What will trigger it? Probably the overall market starting down towards 7800-8000 as a minumum and I hate to say it but perhaps still below 7400 ( this bear mkt is NOT over-far too much complacency). We should start to roll over to the downside within 3-5 days. Then again it wouldn't surprise me that AMAT comes out and says their compass is still very foggy and let's not all get run away with ourselves. But the bottom line is that 21.56 is THE low this cycle