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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: HairBall who wrote (13763)	5/13/1999 12:27:00 PM
From: bearshark	Read Replies (1) \| Respond to of 99985

LG: There are times to be bullish and there are times when one should not be. This topping process is entertaining and is helpful to long and call positions accumulated in March and April. However, unless the laws of nature have been repealed we are preparing for the next useful decline. This is the final act in our upswing from March 1999. I believe you see the same thing but from a different view.

To: HairBall who wrote (13763)	5/13/1999 2:15:00 PM
From: j.o.	Read Replies (2) \| Respond to of 99985

LG, "...however, I noted you too are reluctant...<g>" ok, ok...I will take the bait. Let me just suggest my interpretation of the wave count/timing of this market, even though my education in the ways of the Waves is surely not as extensive as that of Bear King and many others. I just watch and try to figure out for myself what might be happening. I see the current 5-wave move up from 1994 as follows: (I am using the fair value of the S&P cash for my numbers - I hope that they are reliable) Wave 1 12/94 (S&P 454) - 7/96 (S&P 683) = 50% upmove over roughly 19 months Wave 2 - sharp, corrective move down to 610 within short period of time. Wave 3 8/96 (S&P 610) - 7/98 (S&P 1200) = 97% upmove over 24 months Wave 4 - shakeout lasting until September 98/October 98, depending upon interpretation. Wave 5 I see the September 1st 1998 bottom as the completion of the wave 4 downmove, and the bounce from and then 100% retracement down to 930 as the first and second waves of a 5 wave sub-upmove which topped on the 11th of Jan. [One could also say that the 5-wave submove up from the Sept/October bottom is just now finishing its 5th wave - treating the sideways consolidation from Jan-March as wave 4. One might proceed to state that reaching 1395 in the S&P from the 930 bottom would make superwave 5 exactly as large (i.e. 50% from low to high) as superwave 1 above. This is a perfect target from an Elliot wave perspective (as I understand it). This, of course, is a possibility and is the reason for my current uncertainty. Nevertheless, it seems odd to have such a powerful upmove capped by such a short wave 5 - as this would mean wave 5 would terminate after just 9 months, half the time of the 1st wave] Back to my view of the super-wave 5: I believe that the Jan-Mar sideways consolidation formed subwave 2 of the superwave 5. If that is correct, then we are setting up for a great deal more upside - which could easily run another 9 months or so. It would mean that we are just now heading into the biggest wave (3) of the superwave 5, and would suggest that wave 5 is setting up to be as big as wave 3, giving a potential target of S&P 1830. That's 32% up from here. The way I see it, we are still fully in the uptrend which began in September/October, and it could potentially carry us much further. So yes, I am long...but not 100%. And I am going to watch the 1380-1410 level to see how we deal with it. If we break our present uptrend and begin to head down, then I must consider the possibility that the ENTIRE upmove is finished and we are headed for a potentially multi-year bear market - this would go hand in hand with treasury rates continuing to rise, etc, (along with a falling $). In that case I will act accordingly. I don't know if this is what you were looking for. It's my two cents. j.o.