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MortiES' Wave 5 Hallucinations 13Jul2009
July 13th, 2009at 11:30 pm
I promise that there is a reason for this chart. I’m not trying to play Karnack who sees the future. Rather, I did an exercise for myself to see what kind of W5 structure would be required to make it to a reasonable new high. I used typical fibonacci projections and retracements to come up with a typical W5 structure that would get the market to a new high (I used the MOB as a target). The most important part of this exercise has meaning for trading tomorrow and the next day. If my analysis doesn’t help me with tomorrow’s trading, then what good is it? Even if my opinion that we are in daily W5 is wrong, we will most likely be seeing the first part of this idealized wave as an ABC correction. Impulsive and corrective waves both start out the same. The difference comes in when Wave C extends and morphs into a W3. Then the count changes and two additional waves (W4&5) get added on to the structure. Right now IMO we are in W5 of W1 of daily W5. Newbies to EW, be sure you understand what I just said about our current place in the wave count. It will help you understand the fractal nature of waves. So FWIW, here is my version of an idealized Wave 5.
Categories: Markets
mdm ~ be patient and know that the market will be there tomorrow. Patience will be one of your greatest assets as a trader! There is only one educational course that I can recommend and it’s not inexpensive. But as the old adage goes “if you think education is expensive, try ignorance!” That goes double for trading with knowledge. Here is the link to the product:
http://www.dynamictraders.com/education/dynamic-trading-multimedia-e-learning-workshop.html
I bought this to help me tie a lot of loose ends together. I used their software for a while, but much prefer Advanced GET from eSignal. Take a look at the site and know that Miner is for real! This is a quality course if it fits you style of trading (fibs and EW). I also rely heavily on MA’s and trend-lines. For me, the trick to successful trading is to know where you are on all time frames. For example, it is my opinion on the daily chart that slants my opinion of the lower time frames. If you get the course, let me know what you think. It will take you a while to get through it, but don’t be in a rush to lose money.
Mortie, incredible and brilliant call!
i’m impatient to read your broader analysis
do you have some suggestion for “text books” (or even sites, or anything else) for EW? i obviously started with Prechter’s Principle and i want to continue studying before put money in my counts..
thank you very much!
mdm
Hey Joshingu ~ I was at a meeting last night and worked on my analysis when I got home and didn’t see your post until this morning. It is certainly possible that we will meet a lot of resistance here. I think that trend-line will have a lot to say to this market. That last move formed a flagpole with a flag that is usually bullish. But I’ve seen them fail. Most fib dudes will tell us that once Wave C exceeds 162% of Wave A that we are “most likely” in a W3. Since I am favoring the opinion that we are in daily W5, I lean toward this being impulsive since 865.25. A likely possibility for me is that W3 ends at this trend-line and corrects with some profit taking and a W4. Then perhaps a second assault on the trend-line with W5 will take it out and keep this wave going. That trend-line that you’ve drawn is commonly drawn as a resistance in the testing of the right shoulder of a H&S. It’s drawn from the head to the right shoulder. Great chart! and a good observation for those trading Wednesday.
Now, my question to you is ~ Why aren’t you signing up to be a contributor on this site? With your worthwhile analyses and great face (loved the movie), you need your own contributor’s box. The pay won’t hurt your tax bracket! ~ nothing to claim. You get your own admin log in and get to approve all comments on your postings. Nobody approves yours. It’s like having your own site without the hassle. Ben is great to work with and you won’t find an insecure ego afraid of diversity. This site encourages diverse approaches to analysis. We even have some contributors with awesome résumés ~ not like mine “I slept at the Holiday Inn Express”. Expect to see your pretty face in a contributor’s box soon!
fib student ~ I forgot to answer the second question. GET is Advanced GET by eSignal. It’s the software I mainly use for analysis and trading.
Mortie. Is it possible we just made the max move for ABC. As this market has gone to extremes. These are my channels and I even show that they were drawn yesterday….. Perhaps we just made a max ABC move
Es from yesterday
http://1.bp.blogspot.com/_RHfXXuyE7EA/SlwVVYFhuFI/AAAAAAAAB1c/0ztCUViOV7o/s1600-h/es.JPG
Today ES
http://2.bp.blogspot.com/_RHfXXuyE7EA/Sl0FEA4aQqI/AAAAAAAAB1k/ZT-c_OnJ-po/s1600-h/es.JPG
SPX
http://2.bp.blogspot.com/_RHfXXuyE7EA/Sl0MvXWZaFI/AAAAAAAAB1s/nlH5TElOwmg/s1600-h/SPX.JPG
FAZ today
http://2.bp.blogspot.com/_RHfXXuyE7EA/Sl0PBmkQaiI/AAAAAAAAB10/5tYBbrc4JZY/s1600-h/faz+60+minutes+.JPG
FAZ yesterday
http://3.bp.blogspot.com/_RHfXXuyE7EA/Sl0PPBrDiFI/AAAAAAAAB18/inFGIYdfEwc/s1600-h/faz+60.JPG
Rifin Today
http://4.bp.blogspot.com/_RHfXXuyE7EA/Sl0PlkzGtRI/AAAAAAAAB2E/Od5dWzJRdK8/s1600-h/rifin+60+minutes.JPG
Rifin yesterday
http://3.bp.blogspot.com/_RHfXXuyE7EA/Sl0PpK-jBJI/AAAAAAAAB2M/4e9a42_SkT4/s1600-h/rifin.JPG
Mortie, this is what i mean.
mdm ~ I’ll do an update on my overview this weekend. Basically I am looking at the move up from 6Mar as a 5 wave impulsive move. This is still a correction in a larger bear market until proven otherwise. That’s why W5 is going up and not down. I’ll be doing a post in the near future on the bigger picture for those who aren’t sure where I am in the LT time-frame.
fibstudent ~ it’s not “totally” necessary, but it usually happens. The ratio’s you have are fib ratios, but how you apply them to each wave relationship varies. If you follow my posts, I try to teach these relationships as I go along. Once you see it, you will realize that it’s a lot easier than you were imagining. For each of those relationships, there are minimum, typical and maximum fib ratios. Once you learn these, you can project them yourself. Just takes practice.
searchgr ~ I’m not sure what you are looking at, so it’s hard to comment. The corrective waves to W1 should be the W2&4 of the 5 wave impulse.
Gotta run ~ day-job you know!
Maybe we’re in the corrective 4 of the wave 1.
Hi Mortie,
I’ve been following your EW analysis for a while. I’m confused about proportions of Waves 1,3,5 with respect to eachother. Is it totally necessary for the length of W1/W3 or W1/W5 or W3/W5 to be fibonacci in proportion ie 0.618, 1.0, 1.618 (and are these ratios correct)?? Thanks.
Also what is GET???
Mortie,
can you please explain to a newbie your larger wave count?
YOu said we are in W5 of W1 of daily W5.. how this larger W5 fit in the broader picture? As we are in a bear market, i thought a larger (primary? intermediate?) W5 should be headed down and so i’m a little bit confused
thank you very much, your posts are really appreciate
mdm
Correction 900 ES and then we are in correction mode. Above and we are in the 5 wave up move.
A lack of higher highs makes this a corrective. However, a higher makes this a 5 up wave count with the 2 coming back down for shorts to exit. Below 906 ES we still call it an ABC, above we call it a W1
This outlook sure looks plausible – in case the market starts veering of course, I’m considering the possibility of the next top occurring between 912-921 sometime between this friday and next Teusday – that is if it doesn’t roll over sooner – it all depends on what trajectory will make the most people miserable.