Stocks fell sharply Thursday, The Industrials
losing 180 points intraday, but bouncing back into the close,
closing down 115.70 points to 10,120.46. While trying to break
decisively below the key support level 10,100, the Industrials
could not succeed. Price action over the past few days looks like a
Descending Bullish Wedge for wave
{5}down. It may need one more
down leg Friday to complete. Alternately, wave
{5}down finished mid-day
Thursday.Wave
{5}down's bottom will be the bottom of larger degree micro
wave
1down. So far, the decline from January 19th's 10,729.89
top has been 674.81 points, or 6.3 percent. The VIX generated a new
buy signal Tuesday, so it is likely wave
2-up will start soon, if it did not Thursday afternoon. We
believe this wave
2rally will retrace between a third and two-thirds of the
decline from January 19th through January 28th. This rally should
take the form of an
{a}up,
{b}down,
{c}up move. This rally should last a week to ten days.
Posted by hurricanemalta on 29th of Jan 2010 at 08:22 am
The one thing I don't get with McHugh with this wave 2 retrace
talk is the length(days) of the retrace.He is indicating we go up
longer time wise than we went down...doesn't make sense to
me.I did ask Steve but he didn't seem to get the timeframe
either..too long..maybe others have a thought on this.
Also corrective waves, which are even numbered, usually take
longer to complete then the "productive" waves. That was evident on
the advance too, as the market spent nearly 2 months in wave 4
triangle in November and December. If you examine the purpose of
corrective waves, you should see why this extra time lenght is
required for shares to change hands.
It just depends upon how the correction unfolds. A complex
structure will take more time than a simple zig zag. Again,
focus on price first and foremost and view timing as a secondary
indicator.
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An excerpt from McHugh
Posted by Peridot on 29th of Jan 2010 at 08:05 am
Stocks fell sharply Thursday, The Industrials losing 180 points intraday, but bouncing back into the close, closing down 115.70 points to 10,120.46. While trying to break decisively below the key support level 10,100, the Industrials could not succeed. Price action over the past few days looks like a Descending Bullish Wedge for wave {5}down. It may need one more down leg Friday to complete. Alternately, wave {5}down finished mid-day Thursday. Wave {5} down's bottom will be the bottom of larger degree micro wave 1 down. So far, the decline from January 19th's 10,729.89 top has been 674.81 points, or 6.3 percent. The VIX generated a new buy signal Tuesday, so it is likely wave 2 -up will start soon, if it did not Thursday afternoon. We believe this wave 2 rally will retrace between a third and two-thirds of the decline from January 19th through January 28th. This rally should take the form of an {a} up, {b} down, {c} up move. This rally should last a week to ten days.
Thanks Peridot for posting McHugh BUT..I have a question
Posted by hurricanemalta on 29th of Jan 2010 at 08:22 am
The one thing I don't get with McHugh with this wave 2 retrace talk is the length(days) of the retrace.He is indicating we go up longer time wise than we went down...doesn't make sense to me.I did ask Steve but he didn't seem to get the timeframe either..too long..maybe others have a thought on this.
thanks
I'm not able to answer
Posted by Peridot on 29th of Jan 2010 at 08:42 am
I'm not able to answer your question. As we all know, it takes longer to go UP than it does to come Down. p
Also corrective waves, which are
Posted by junkie on 29th of Jan 2010 at 09:08 am
Also corrective waves, which are even numbered, usually take longer to complete then the "productive" waves. That was evident on the advance too, as the market spent nearly 2 months in wave 4 triangle in November and December. If you examine the purpose of corrective waves, you should see why this extra time lenght is required for shares to change hands.
It just depends upon how
Posted by steve on 29th of Jan 2010 at 09:16 am
It just depends upon how the correction unfolds. A complex structure will take more time than a simple zig zag. Again, focus on price first and foremost and view timing as a secondary indicator.