Value of Perfect Information

I made two charts of my global view of the SPX moves. I don’t really belive in Prechters P2 disaster scenario – Prechters see SPX at 300 or lower – this is equal to world war/epidemic or financial collapse. Of course we are talking all the time about this, and it getting happen – (common unemployment >10% now, prime by 12% default, sub-prime by 40%) – untill USA can hold AAA Rating (all rating agencies are US companies) – this is more P4 as P2 to me.

But back to our big-picture and charts. I was looking on various sites  about still running w5. This is not possible, based on EW. Why? (see my chart), because of the broken trend-line (0-b’ line), which confirms that the previous move is terminated. But it doesn’t mean that the highs are in. WE CAN EXPAND IN b-WAVES by x 1.61. Please don’t forget this rule. If you have Prechters EW Principle book open the page 81. You will find a lot of stories about the B-Wave(s).

The are several evidences for the end of this move since 666.79.
1) break of the 0-b line
2) divergences in hourly
3) time of a wave equal to time of c wave

But the most important question to me is where we are. In my count (see chart) untill 1200.44 is not broken we are still in the wave iv. If it breaks, the next mob is 1256.98. Only after the break of 1256.98 the up-move from the low can be interpreted as P2 or whatever.

In the short term view for the next month I see a correction, with a min. target for the next b-wave 956. In average it could be a correction between 32%-61%.It is also possible that the entire up move was terminated at 1080.15 and we are already in the a” wave with expanded b. But in my primary count I count the end of A/W at 1100.17 and we are in the minor b of a” wave, which again can EXPAND over the begin of the a-wave, and etc.

The question is – can this count can help me to trade. Right now I am not sure what will be the next – extended b-wave or drop into the c-wave to complete the a”.

We will see this in the next week.

P.S. Dow has already EXPAND its b-wave, which will let to 1)flat or 2) over-extended c-wave with max. 261% of a.

Tags: Big Picture, EW, SPX

Categories: Charts ,Elliott Wave ,Markets

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