Feb 27, 2010

The Volatile DXY

There is usually either a direct or inverse relationship between between the dollar and the markets. I felt it was a good idea to see what was going to happen over the next 10 or so years to have an idea of what we are in for. This was actually one of the easiest charts that I have worked with. I feel very confident in these projections.

Here is an intermediate term chart that may cover the next 2-3years depending on how fast the movement is.
Then, I took this short term chart and applied the projections to a Monthly chart. Unfortunately, my charts don't go back far enough to give a projection once the dollar bottoms. 46 on the DXY, I guess things will get more expensive won't they?

Feb 26, 2010

How to Identify a C wave and Measure for Target

I am sure many are trying to figure out why I am so bearish and comfortable holding on to my 10.96 TZA goof. I should have known wave 4 would go much higher than it has. In my first example it doesn't retrace as high as most. I would also like to show you the beauty of Elliot Wave when combined with fibinocci measurements. Prechter has been wrong his predictions because in traditional elliot wave, there is no real way to count c waves. The problem is within a C wave, every 4th and 5th wave have an ABC pattern that extends them beyond their normal targets. You can see how over months or years this would throw off any prediction if you didn't know what to look for. I posted the link to the new rules in the facebook links section for anyone who wants to download the free e-book.

I figured I would start with the C wave of 5 that ended the trading day today using a 1 minute chart. Notice the 423.6% target measured by the first 3 waves. I labeled the last projection, "wave 5 from March" because this is essentially the same pattern and to illustrate how we need to play the rest of the year.
Now see if you see the resemblance in the 60min chart. I apologize for the labeling, the last time I tried to delete them on one chart, my program deleted them all my formats.
Now, for the grand finale, to really illustrate the beauty of Elliot Wave, here is the Dow from 2007 using the same technique and fibinocci measurement. No matter the scale, the pattern and measurements are the same. In red I performed the same measurement, and it appears we will get the double-top that many have been looking for, but it will take a while to get there. The bottom target specifically is 3355.

IWM 2/26- Will we make a new high on Monday?

The action today was just a continuation from yesterday and is still within my wave 2 of 1 of 5 guidelines. If the 633.5 holds on Monday this count is accurate. Otherwise, there is still the possiblity of moving the C4 of 4 over one wave and this current wave would be wave 5 of 4 of C instead.

Feb 25, 2010

30 Year Treasury Yield Since 1980

I was just playing around last night and did some wave counts for the 30 year Treasury Index. It's not inverse as most charts, the up and down correlate with the interest rate. Notice how close we have come to the 261.8% normal 5 wave target? Looks to be 5-10 years before it bottoms.

IWM 2/25 Could This Be the Start of the Run to 550's?

Unless a new high is made tomorrow, I am sticking with my original counts (from facebook yesterday). If a new high is made, then C4 would just get slid over 1 more wave, but the bulls still can't get away.

Feb 22, 2010

Short Term Chart for IWM