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MortiES' BIG PICTURE ~ By Popular Request

Written by Mortie
July 18th, 2009at 12:00 pm

Many have been asking me for a long-term forecast of [tag]ES[/tag] based on [tag]Elliott[/tag] and the other “cool stuff” I use in analysis. So, by popular demand, here it is.

First I need to make a few comments on this chart. This is based on TA, and not my feelings about the economy or [tag]Obama[/tag]. I do read the news and have strong opinions. For this study, I put my fears and opinions aside and tell you what I see technically. If I use the “normal” settings on my [tag]Advanced GET (GET)[/tag] software, it has us in a W4. In this case, I believe that the daily chart is determinative for the count, and therefore I used the “short-term” GET count which coincides with the daily. My arrows are drawn to plausible targets in price and time based on many [tag]Fibonacci[/tag] relationships that I used. They might be considered typical moves. However, remember that ES seems to like extreme-typical moves. This scenario has this corrective ABC move ending in a time zone from early September to early January 2010. That is not an unexpected time-frame from what I hear many hypothesizing. The only arrow that I think might be short of the final target is the one for Wave B. I think that will be closer to the 62% retracement level. But to get Wave C where I needed it in the “green zone” I ended it early in the Wave B zone. This is one of my musings.

ES Weekly Analysis 18Jul2009

Now that you have reviewed this chart, guess what? I have another scenario that will get us to the green zone, but this scenario will have much different ramifications. I’ll get that one out tonight or tomorrow. Stay tuned ~ same Bat-time same Bat-channel. The “real Mortie” doesn’t like my working on these charts in the middle of the night because it interferes with his beauty rest. So I probably won’t get the next chart out until tomorrow.

[tags]ES, Elliott Wave, Advanced GET, Fibonacci, Obama[/tags]

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Categories: Charts ,Exclusive ,Markets

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17 Responses to “MortiES' BIG PICTURE ~ By Popular Request”

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  1. searchgr searchgr says:
    July 20, 2009 at 6:33 am

    We are now at c4.

    Reply
  2. searchgr searchgr says:
    July 20, 2009 at 6:33 am

    The bear market finishes at c5.

    Reply
  3. Mortie Mortie says:
    July 20, 2009 at 4:31 am

    Searchgr ~ I can’t argue with your chart. I believe this scenario is much more rationale than the one where we are in P2 now. By the time that scenario plays out, the market will be below “0″. Take a look at the possibility that Wave A is a Wave 4 and Wave B is a Wave 5 (it looks better on a log scale), and let me know your thoughts. That would be more bearish than your count. Great comments as usual!

    Reply
  4. searchgr searchgr says:
    July 19, 2009 at 11:47 pm

    Mortie,is a big zigzag. Furthermore this wave 4 will smooth the oscillator in order to give a buy signal when the wave 5 will be finished.

    1.gif2.gif

    Reply
  5. Mortie Mortie says:
    July 19, 2009 at 10:28 pm

    Searchgr ~ thanks for the chart. I’m much closer to your count than what most people are talking about with P1, 2 ,3 ,4 & 5. That view has your Wave 3 as the end of P1. The see that move as a completed W5 of the first leg in an impulsive move down. They see us now in P2 whereas you feel that we are in W4 of this move from Oct2007. My question is whether what you label as Wave 3 is actually Wave 5. An argument can be made for both. I lean now to Wave 5 being completed where you have Wave 3. Both are possibilities. So we are not really in strong disagreement. My bigger question is what is this impulsive wave from Oct2007 a subwave of. Is the bigger wave a Wave A of an ABC correction from a completed W5 in Oct2007 with Wave B and C to come and bring us to new lows (remember that an impulsive wave cannot be the whole of a correction, but it can be Wave A and Wave C). OR ~ as the big boys at EWI believe, is the technical top at the high in Jan2000. In that scenario, Wave B made a higher high and we are in Wave C now which will be made up of P1-5. At least that’s my read on what I think I’m hearing. My question is ~ why do we need more than this present 5 Wave move to complete Wave C. I’m not sure that we haven’t seen the bottom of Wave C at 666 ~ or if your count is correct, at the end of Wave 5 of your scenario. I’ll look at this later this week and post some charts on my thoughts. If I am misrepresenting the P wave scenario, let me know because I really haven’t studied it that hard. I wasn’t trading for a while for many reasons and didn’t do that analysis at the time.

    Reply
  6. MrTrader MrTrader says:
    July 19, 2009 at 9:57 pm

    Hi Fujisan, great to see you here. Welcome!

    I’ve learned a lot from you over at the evil lair.

    I had a question for you – assuming a person has a trading account w/ 12k and wants to establish a short spy position – what would be your preferred method for establishing a short position in the spy where Delta would be as close to -1 as possible?

    1. The simplest way would be to just short say 100 shares of spy and if it’s trading at say 120 at that time, this person could afford to establish a non-margined position of 100 shares.
    2. Use a deep ITM put option with 90+ days till expiration with a Delta very close to -1 which would cost around 2k per contract – this way the trader could afford around 5 contracts and would have the equivalent of a 500 share short position with a 10k account
    3. Use a synthetic short strategy by buying a put and selling a call of the same strike – lets say buy the 120 put and sell the 120 call of a contract with 90+ days to expiration. Assuming this would be either a break even or very small net debit transaction, it appears that this particular trader could open more than 5 of these synthetic short pairs with his 12k account – of course if the market moves against you, this scenario would be much more prone to a margin call

    Given these options, lets say trader x wants to open the equivalent of a -300 share position – if you were trader x, would you go with option 2, 3 or something I have not thought of.

    Thanks in advance

    Reply
  7. searchgr searchgr says:
    July 19, 2009 at 9:55 pm

    .

    1_spp.gif

    Reply
  8. Mortie Mortie says:
    July 19, 2009 at 6:45 pm

    Someone needs to show me on a chart what you think is the wave count that justifies the wave count of a P1,2 etc. Then we can compare apples with apples. We might all have something different in mind. When you post your chart, use a log chart and go back as far as you can with data. Label the data as you understand it. Then let’s talk. I don’t have a strong opinion on this yet.

    Reply
  9. mdm mdm says:
    July 19, 2009 at 2:20 pm

    but i’m missing the P2

    Reply
  10. searchgr searchgr says:
    July 19, 2009 at 2:08 pm

    at 666 ended a Primary wave 3

    Reply
  11. mdm mdm says:
    July 19, 2009 at 2:06 pm

    Mortie, thanks for this upgrade!
    going to even broader, at 666 ended a Primary wave 1 so at the end of correction we’ll see a Primary wave 3 down?
    thanks again
    mdm

    Reply
  12. Mortie Mortie says:
    July 19, 2009 at 12:12 pm

    Fujisan ~ I haven’t sipped out of that Kool-Aid bowl yet. The P1/P2/P3/P4/P5 rout of the market is popular and might be correct, but I am not convinced yet based on TA. I’ll do a really BIG study on that in the near future since I am asked that question a lot. There are a few ways to look at the topping of the major indices, and the correction IMO. I am, by no means, in the same league as the Elliott “gods”, but that may be to my advantage. I’m not carrying a lot of baggage forward.

    Reply
  13. Fujisan Fujisan says:
    July 19, 2009 at 12:01 pm

    Thanks for your response, Mortie,

    I know that a lot of Elliottitians are labeling the current counter bounce as P2 and expecting another big plunge coming after this. Is this your view as well?

    Reply
  14. Mortie Mortie says:
    July 18, 2009 at 9:50 pm

    Fujisan ~ you have a good eye for patterns. I agree that that could be a real possibility. And if that happens, it could have some profound bullish implications! Good comment!

    Reply
  15. Mortie Mortie says:
    July 18, 2009 at 9:48 pm

    Joshing ~ I have thought of that but because I believe that looking at the bigger picture, we were in a Wave C down from the Oct2007 high. That Wave C needed to be a 5 wave pattern and I believe that was completed on 6Mar2009. At least that is how I see the big-big picture.

    Reply
  16. j0sh1ngU j0sh1ngU says:
    July 18, 2009 at 4:22 pm

    Ever consider the 5 wave up from the 666. And then we begin our decent…. With 666 being a B and A ~950 made in 2008?

    Reply
  17. Fujisan Fujisan says:
    July 18, 2009 at 4:03 pm

    Hi, Mortie,

    Thanks for your update. It looks like it’s forming an inverted H&S pattern. Nice symmetrical pattern. Great job.

    avatar128.jpg

    Reply

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