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Hello,
I received this today before the markets opened, I didnt post it this
morning....... Today during market hours my mentor informed me to go
short at 7880(or aprox those levels, ) (He was right, but since I dont
do options nor futures it doesnt make a big difference to me other than
tell me the intraday direction of the market) Anyway Stubborn as I am I
still think Elliot will have to accomodate me (the fool) and might have
to alter his count since I am looking at 6100 To me everything still
points in that direction (I am willing to eat humble pie later and will
not hesitate to accept my mentors count if proven wrong.Till now though
I accept his count is any day better than mine)
Mentorspeak here goes:
Oct 6, 1998
Draw a trendline from the IInd wave termination point (8672 - I think)
through the presumed IVth wave termination point - 8182. When the
market rallied to 8160 subsequently, I think it breached this
trendline. This is unacceptable because no part of the Vth wave must
break the II - IV trendline. The only exception to this rule is if
the Vth wave is a terminal impulse (diagonal triangle). Accordingly,
the II - IV trendline has to be adjusted to 8160 and this point has
to be taken as the end of wave IV. Therefore, wave V started at 8160
and this makes us adjust the max downside target to 7374.
Now the Vth wave will be in 5-waves. The 1st wave of these 5 waves is
complete - from 8160 to 7530 = 630 points. If our overall analysis
is correct (that the market should not break 7374), THEN THE 1ST WAVE
HAS TO NECESSARILY BE THE EXTENDED WAVE. Let us now try read the
market presuming that the 1st wave is the extended wave. When the
1st wave extends, the 2nd wave will normally not retrace much more
than 50% of the 1st wave. Also when comparing the 2nd and 4th waves
- the 2nd wave will be more complex than the 4th wave and will
normally take more time than the 4th wave. A 50% retracement gives
a target - 7530 + (630 X 0.5) = 7845. The market rallied to 7830
on Friday. I do not know what pattern the 2nd wave will make but
Monday's market action seems to indicate a normal a-b-c flat
correction. The a-wave of this flat correction terminated at 7830,
the b-wave at 7551 and the c-wave is in progress. THIS c-WAVE WILL
NOT GO MUCH ABOVE 7845 (15 TO 20 POINTS MORE IS OK) and at this point,
the 2nd wave of the Vth wave will terminate and the 3rd wave downwards
will begin. This 3rd wave will certainly break the 7530 bottom. I
don't know by how much, but if my overall analysis is correct, maybe
by 70 to 100 points. After the 3rd wave completes, the 4th wave
upward will begin. If this 4th wave falls into the 2nd wave area
(i.e. goes above 7530) the entire Vth wave will turn into a terminal
impulse pattern. If the entire Vth wave fails to breach the bottom
of the IIIrd wave, i.e. 7400 - the entire pattern from 9367 to
the end of the Vth wave will be known as a Vth failure. When the
Vth wave fails THERE WILL BE NO NEW LOWS (OR HIGHS - IF THE PATTERN
WAS TRENDING UPWARDS) IN THE MARKET UNTIL AND UNLESS THE ENTIRE
Vth FAILURE PATTERN IS COMPLETELY RETRACED. In this case that would
mean the market will cross 9367. Let us closely observe how the
market behaves in the coming days.
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