Straits Times Index - Macro View
One of the premises of Technical Analysis is "History repeats itself" ( the other two are "Market action discounts everything" & "Prices move in trends"). The Elliot Wave chart I have produced below is based upon this premise.
This is probably the most comprehensive Elliot Wave chart I have ever produced. It is a weekly chart traced back to ten years ago where the last bull market has begun. The circle on the right is where we are today. I believe this is corresponding to where we were in the last bull on the left hand circle :
This is probably the most comprehensive Elliot Wave chart I have ever produced. It is a weekly chart traced back to ten years ago where the last bull market has begun. The circle on the right is where we are today. I believe this is corresponding to where we were in the last bull on the left hand circle :
If my assumption make sense, we may already be in the correction. Based on history, the corresponding correction lasted for 4 weeks & corrected by 38.2%. Using the same ratio, we may be looking at 2,250 in the coming weeks.
The odds, however, may happen. That is, if STI managed to hit 2,680 to trigger Parabolic SAR buy phrase. The market will turn bullish and may score a new higher high. This will cause Elliot Wave 5v to be recounted as 5iii and 5v may move up to 2,800 or beyond. The correction I anticipate will still happen but postponed till the new 5v is met.
I know this can be frustrating but unfortunately no one has the power to dictate how the market should move. Elliot Wave count or Technical Analysis are tools which could help us to observe how the market may move. It won't provide the sure answer neither nor it is infallible.
The chart below is a close up shot of the right hand circle in the above chart. It paints the two scenarios I have depicted above. The orange color assumes we are already in the correction. The blue color is "the odds" I mentioned, where it will cause the recount.
The odds, however, may happen. That is, if STI managed to hit 2,680 to trigger Parabolic SAR buy phrase. The market will turn bullish and may score a new higher high. This will cause Elliot Wave 5v to be recounted as 5iii and 5v may move up to 2,800 or beyond. The correction I anticipate will still happen but postponed till the new 5v is met.
I know this can be frustrating but unfortunately no one has the power to dictate how the market should move. Elliot Wave count or Technical Analysis are tools which could help us to observe how the market may move. It won't provide the sure answer neither nor it is infallible.
The chart below is a close up shot of the right hand circle in the above chart. It paints the two scenarios I have depicted above. The orange color assumes we are already in the correction. The blue color is "the odds" I mentioned, where it will cause the recount.
The above is my subjective view. It explains why I have been so cautious about the market lately.
"If you don't bet, you can't win. If you lose all your chips, you can't bet" -- Larry Hite.
Why I am so defensive the past 1 ~ 2 weeks ( by staying sidelines ) is to safe guard my chips!
PS: In regard to the Corrective Wave count. I am aware many people ( including EWI ) believe what we are going through now is a bear market rally (Primary Wave B of the Primary A, B, C wave). Again, up until now I do not subscribe to this view for reasons stated before. But I stand corrected when market unfold enough to prove me wrong. Regardless of where we are, it does not affect the impending correction which is a result of the completion of a 5 impulse waves move.
"If you don't bet, you can't win. If you lose all your chips, you can't bet" -- Larry Hite.
Why I am so defensive the past 1 ~ 2 weeks ( by staying sidelines ) is to safe guard my chips!
PS: In regard to the Corrective Wave count. I am aware many people ( including EWI ) believe what we are going through now is a bear market rally (Primary Wave B of the Primary A, B, C wave). Again, up until now I do not subscribe to this view for reasons stated before. But I stand corrected when market unfold enough to prove me wrong. Regardless of where we are, it does not affect the impending correction which is a result of the completion of a 5 impulse waves move.
Labels: Market Direction
posted by Market Wizards @ August 15, 2009
Comments: 0
