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On a daily chart the DJIA appears to be half way to finishing a 5th
wave. The drop from the High in July could now be said to look like 5
waves down completing. It has only to finish below 7400 to meet minimum
EW requirements. I am looking to 7000 for 5 to be equal to 1 as
preferred.
If the 5th wave completes as expected and no extended down moves occur,
then a classic EW rule will apply. A 5 wave move is never the complete
move. A Larger 3 wave move must follow at a minimum.
Expect a Larger 2nd wave correction and at least one more Larger down
wave to commence later this fall, say October sometime or around
Election time.
If this is a true trend change, a massive Larger 3rd wave, larger than
the initial 2500 point drop from July should occur. A 1.618 relationship
would suggest around a 4000 point drop from wherever the correction
(Larger Wave 2) ends this fall.
Now, if only I can execute my entries and exits profitably.
Switched to buying puts last week during the 4th wave yo yo. Took away
some of fear generated by the wide daily swings.
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