"Politics is too serious a matter to be left to the politicians."

--Charles DeGaulle

UPDATED 20060601

COMMENT #190

CHART #380

1. This morning's CHART #380 shows hourly prices for the June contract.

2. The difference between today's CHART #380 and yesterday's is that today's shows day session prices while yesterday's shows overnight prices.

3. Today's updates the following CHART of June day session prices:

4. In that CHART, it was believed possible that the entire decline from the high of a year or so ago had ended.

5. The CHART showed, at the top, that the blue Wave 5 low was occurring 233 hours from the blue Wave 5 high shown in the upper left corner.

6. A possible outcome that allowed for the delay of the final low was shown in the lower right corner where the blue Wave 5 low was labeled as possibly only the black Wave 3 of blue Wave 5 low (whew on that one!).

7. The black a-b-c-x-a-b-c movement was shown the day after the eventual low on the 12th in the following CHART of daily prices for the continuous spot futures contract:

8. (The "X" wave at the high of the CHART was marked in blue for emphasis).

9. In today's CHART of hourly prices for the June day session contract (whew again!), the first notice day expected liquidation is shown to have ended this morning on or about the opening price.

10. This low is believed to have completed the blue a-b-c correction shown in the CHART and, thereby, to have set the Elliott Wave blue Wave 2 low (see pages 283-92 of "The $upertrader's Reference Manual").

11. There are two black boxes in the CHART, one above price and one below.

12. The text in the black box above price shows the 5 impulsive waves that comprised the blue Wave 1 advance.

13. The blue Wave 1 advance is the upleg that occurred from the a-b-c-x-a-b-c low shown in the CHART to the blue "1" high.

14. The text in the black box above price shows that this movement unfolded in 16-5-22-5-6=53 hours (FIBONACCI #s=5, 21 & 55).

15. Here we see W2=5=W4.

16. Other interesting relationships are also shown in the box.

17. The 1st, 3rd and 5th waves of the advance are marked, from a price perspective, by the green numbers above price.

18. These numbers show the number of ticks of each leg of the advance.

19. The total number of ticks is shown by the upper number just below the blue "1" and is 79 ticks (6 X FIBONACCI #13=78).

20. The two green boxes at the +35 and +36 measurements of the 1st and 5th waves show that these two uplegs, from a price perspective, are almost exactly equal (FIBONACCI #=34).

21. The 3rd leg, at 73 ticks, is thus almost exactly twice the measure of the 5th in that 73/36=2.028 (PHI X SQ RT PHI=2.058).

22. Since the black box shows that the 1st wave lasted 16 hours and the 5th lasted 6 hours, the two legs are FIBONACCI # related since 2 X FIBONACCI #3=6 and 2 X FIBONACCI #8=16.

23. The legs are also PHI related since 16/6 ~ SQ PHI.

24. Now we want to inspect the decline from the blue Wave 1 high to the blue Wave 2 low.

25. Then we'll compare the blue Wave 2 decline to the blue Wave 1 advance.

26. The black box below price shows that the decline from the blue Wave 1 high to the blue Wave 2 low unfolded in the blue a-b-c movement shown in the CHART.

27. This interpretation is based on that of late yesterday in CHART #379 (see above CHART of hourly overnight session prices for the June contract).

28. The box shows this movement as having unfolded in a 14-12-7=33 hour movement (FIBONACCI #s=8, 13 & 34).

29. The Wave a decline of 14 hours is thus twice that of the Wave c decline in terms of time.

30. In ticks, 27 & 21 ticks in the two downlegs.

31. 27/21=1.286 (SQ RT PHI=1.272).

32. 57 ticks total in the blue Wave 2 decline (FIBONACCI #=55).

33. 57/27=2.111 (SQ RT PHI X PHI = 2.058).

34. We can thus see that the blue Wave 2 low has unfolded in FIBONACCI #s and PHI proportions.

35. Now let's look at the blue Wave 1 advance versus the blue Wave 2 decline.

36. From a time perspective, the advance/decline lasted 53 & 33 hours, 86 total (FIBONACCI #s=34, 55 & 89).

37. These segments are shown by the blue lines above price.

38. As can be seen, 53/33=1.606 (PHI=1.618).

39. 86/53=1.623 (PHI=1.618).

40. 86/33=2.606 (SQ PHI=2.618).

41. In terms of price, the advance of 79 ticks versus the decline of 57 is 1.386 (1.000 + SQ[1/PHI]=1.382).

42. The green vertical lines in the CHART mark the continuation of the 39 hour periodicity identified in the hourly CHART (see above) of earlier this month.

43. The next rep was from the black Wave 3 low in today's CHART to the final low of the move.

44. The black text above shows that this rep lengthened a bit and lasted 45 hours.

45. The next rep marked the 3rd wave high of the blue Wave 1 advance and lasted another 42 hours followed by the 44 hour period of the next rep to this morning's low.

46. These three reps are shown in the CHART by the last three vertical green lines and are marked in the CHART by the red horizontal line shown.

47. We had discussed how the key trendline as the market was bottoming was actually the green down trendline below prices shown in today's CHART.

48. Another key trendline has now formed as a result of all the above and is the red down trendline above price drawn from the blue Wave 1 high.

49. Note that the pink horizontal trendline of yesterday has now been replaced by the red down trendline today.

50. The new horizontal pink trendline shown today shows that price has already broken the blue Wave a low which suggests that the labeling shown in the CHART is correct.

51. The assumption thus remains that the market is in the process of advancing upwards.

52. It remains too early to attempt to determine the extent of the advance that may occur.

53. It is possible that the blue Wave 1 / 2 sequence shown in today's CHART is but a blue Wave A / B corrective sequence.

54. Although that's possible, it is not favored at this time.

55. Instead, what we want to do now is to proceed in the assumption that the blue Wave 1 / 2 sequence is operative until the market itself shows us otherwise.

56. That assumption will remain so long as the blue Wave 2 low is not negated.

57. If the blue Wave 2 low is negated, we'll have to come back and reassess for this market, for the rest of the complex, and for other markets affected by the action in this market.

58. Now we want to go back to the daily CHART.

59. What has caused this bullish interpretation are the green and blue boxes in the lower right corner.

60. In support of this interpretation are the seasonals which are shown in the following CHART from "The 2006 $upertrader's Almanac - 1st Half Edition".

61. All the above discussion is very important, but it is secondary to the alignment of the seasonal expected advance and the Inversion Cycle Index turn projected by the blue box, low projected by the green box and action of the market itself in moving down into the projected low and projected turn.

62. Further supportive are the two boxes shown at the very bottom of the daily CHART.

63. Here we see that such momentum oscillators as RSI and Slow Stochastics and the net commercial position are also suggesting higher prices.

64. Again, however, these are important, but secondary, bits of information.

UPDATED 20060601

COMMENT #191

CHART #s 382-383

1. The high was marked in the complex by the following CHART of daily prices:

2. The following CHART of hourly June prices seems to represent, as well as any other contract in the complex, the ensuing decline:

3. There are several 5 wave impulsive sequences shown by the small black numbers and red boxes, each of which ratify the belief that trend has turned down and has further to go on the downside (see pages 283-92 of "The $upertrader's Reference Manual").

4. There are just some times when Elliott Wave interpretations, however, do not seem to provide insight with respect to current action in the market.

5. The 5 wave impulsive segments shown seem to make sense, but, together, they do not seem to add up to a completed decline.

6. Nor do they, however, suggest an incomplete decline.

7. The bold black 5th leg down is about .618 of the blue Wave 2 high to bold black Wave 3 low.

8. The entire blue Wave 3 decline lasted 55 hours with the black 3 & 5 being about equal in time at 20 & 22 hours (FIBONACCI #=21).

9. At the low, we can see how such momentum oscillators as RSI and Slow Stochastics have failed to confirm the new price low, thereby forming an important price/momentum oscillator divergence (see pages 171-84 of "The $upertrader's Reference Manual").

10. Interestingly, the two 24 hour (day session hours) segments marked by the red lines and three green buckets suggests the possibility of a reverse head-and-shoulders bottom.

11. From the low, the market can be seen as having retraced .382 of the decline to the red Wave A high.

12. Other price retracement levels of the decline are noted in the CHART.

13. As can be seen, the .786 price retracement level is also at the price level of twice the advance from the low in the CHART to the red Wave A high.

14. CHART #383 also shows hourly prices for the June contract.

15. Here we see that the total decline to the low in the CHART lasted 90 hours (FIBONACCI #=89).

16. A 54 or so hourly corrective movement would be ideal.

17. Since 16+7=23 have already lapsed, a 54 hour upward correction would allow for an advance lasting 31 hours (so that 16+7+31=54 and 90+54=144).

18. A standard movement would see a 16-7-16=39 hours.

19. This potential movement is marked in the CHART as shown.

20. If the black Wave C advance equaled the black Wave A advance, the movement would carry up to the red upper up channel trendline shown and would end at the down black arrow.

21. This point in price and time can also be seen to be at the junction of the blue center pitchfork ascending line.

22. Such an outcome suggests that price will break above the high of last week marked in the CHART at the black Wave A high.

23. Note that this interpretation suggests that the 90 hour low shown in the CHART is, likely, a Larger Degree of Trading Wave 1 low and that the black A-B-C movement since the 90 hour low is, thus, expected to be a corrective advance that forms a Wave 2 high and ends the correction.

24. Should such become the outcome, such Wave 1 / 2 sequence would place the market in position to begin a Wave 3 decline upon completion of the Wave 2 high and would be consistent with the discussion and information related to the following CHART of daily prices:

25. A break of the lower up channel red trendline shown in the #383 CHART will suggest that the upside attempt has run out-of-gas and that the market has begun a new downside thrust.