JUNE COMMENTS
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Comment numbers for 20060606 196 197
GENERAL COMMENTS
"It would indeed be ironic if,
in the name of national defense,
we would sanction the subversion of one of the liberties . . .
which makes the defense of the Nation worthwhile."
- United States v. Robel, 389 US 258, 264 (1967)
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1. We always want to be aware of those projected turning points on page 368 of "The 2006 $upertrader's Almanac - 1st Half Edition".
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CURRENT COMMENTS
"He serves his party best who serves the country best." UPDATED 20060606
COMMENT #196
CHART #s 389-392
(Posted afternoon, 20060606)
1. Let's update these CHARTS from yesterday:
2. Today's CHART #389 updates daily prices through noon or so today.
3. In the upper left corner of the CHART, we can see how price had been seen to have barely broken the horizontal red line shown.
4. The high yesterday was consistent with the rightmost apex of the triangle shown here:
5. The CHARTs on the left show cash index and day session prices.
6. Those on the right show overnight session prices.
7. As can be seen, those on the right did not confirm the new highs above the red lines as did those on the left, thereby continuing the intramarket divergences (see pages 171-84 of "The $upertrader's Reference Manual").
8. This action in this market is similar to that seen elsewhere in the complex.
9. This is the most important event of the day.
10. It is likely that this will prove to be the most important event of the next several weeks.
11. CHART #390 shows daily prices for another market in the complex where the same story is being told.
12. Where the new intraday low was seen in these markets, such momentum oscillators as RSI and Slow Stochastics have failed to confirm the new lows, thereby forming important price/momentum oscillator divergences (see pages 171-84 of "The $upertrader's Reference Manual").
13. Today's CHART #391 shows such an example of daily prices for the continuous spot futures market.
14. CHART #392 shows daily prices for the continuous spot futures price.
15. Here a little different perspective is presented.
16. The red lines above price show how the up and down segments shown of 44 and 88 calendar days (FIBONACCI #=89) are related by the ratio of 2.000 : 1.000.
17. This ratio is marked in the CHART by the green arrows above price.
18. The total number of calendar days for the two segments is reported in the upper right corner and is 132 calendar days so that 132 / 44 = 3.000 (not reported).
19. At the bottom of the CHART, we see the price / momentum oscillator divergence shown in the previous CHART marked by the two short red sloping trendlines (see pages 171-84 of "The $upertrader's Reference Manual").
20. The black arrow at the bottom of the CHART pointing to the 1116 high shows that the decline to the 511 low (512 in the CHART) was comprised of 44 up and 132 down days yielding the same 3.000 : 1.000 ratio as shown by the green lines at the bottom of the CHART.
21. The 132 calendar days common to both movements ( the decline to the 511 low and the decline to the 605 low) are marked in the two boxes with the light blue coloring.
22. We can see that the two downlegs marked in the CHART from the March high by the two red boxes measured 273 and 275 ticks (FIBONACCI #s 5 X 55 = 275).
23. Or near equality.
24. This suggests that the two downlegs marked the 1st and 5th waves down of a 5 wave Elliott Wave impulsive decline that is now complete (see pages 283-92 of "The $upertrader's Reference Manual").
25. The 5 wave impulsive sequence is shown by the blue numbers in the CHART.
26. The divergences that have been cited are consistent with an important bottom having formed.
27. As seen in today's #390 CHART, the 512 low remains in the cash index shown in the upper left corner.
28. The favored interpretation for the complex thus remains as shown by this CHART of daily prices which was presented at the end of the decline last month and shows the decline has a completed blue Wave C of [B] movement.
29. Today's #392 CHART shows that, even where the low of last month was broken this month, the action is still suggestive of a completed decline that has exhausted its downside energy.
UPDATED 20060606
COMMENT #197
CHART #s 393-395
(Post-Close)
1. Let's take a look at monthly prices for the continuous spot futures contract in CHART #393.
2. From a price perspective, the three advancing legs marked by the blue 1, 3 & 5 would seem to suggest a completed Elliott Wave 5 wave impulsive sequence (see pages 283-92 of "The $upertrader's Reference Manual").
3. But when we examine how the movement has occurred from a time perspective, the movement is seen as having occurred over 24-4-6-6-12=52 months.
4. Although the swings are very proportionate (with four of the swings being multiples of 6), the 3rd wave is shorter than the 5th and the 1st.
5. An alternative is shown in the lower right corner that presents the advance from the blue Wave 2 low in 2004 as another 5 wave impulsive sequence.
6. The waves are marked below the red horiztonal line by the black numbers.
7. CHART #394 shows weekly prices of the same movement.
8. Here we see the blue Wave 3 advance marked by the black numbers.
9. This movement is seen as having advanced in a 27-25-41-5-8=106 week sequence with 76 up and 30 down (LUCAS #s=29 & 76).
10. 76/30=2.533 (SQ PHI=2.618).
11. Several PHI relationships from a price perspective are noted in the CHART in the blue Wave 3 advance.
12. The black Wave 3 advance, which is labeled by the small black roman numerals, is seen as having unfolded in an 8-2-9-6-16=41 week sequence with 33 up and 8 down weeks (FIBONACCI #s=8 & 34 & 2 X FIBONACCI #21=42).
13. Here we see a well-balanced advance of W1+W3=17 ~ 16=W5 weeks.
14. The green boxes show that the Wi and Wv legs up are about equal, price-wise, at 478 and 497 ticks each.
15. In both of the above CHARTS, we can see how such momentum oscillators as RSI and Slow Stochastics are failing to confirm the new highs, thereby forming important price/momentum oscillator divergences (see pages 171-84 of "The $upertrader's Reference Manual").
16. CHART #395 shows daily prices from the black Wave iv of black 3 of blue 3 low shown in the lower left corner of the CHART.
17. We can see how the high shown in the upper right corner of the CHART has occurred at the blue WIC box shown (Weekly Inversion Cycle Index projected turn).
18. Since price has been moving up into the projected turn, the expectation is that the turn will produce a high in price and reverse from an up to a down trend.
19. The green boxes show that the blue Wave 1 & blue Wave 5 uplegs are about equal from a price standpoint.
20. The Roman numerals show how the blue Wave 3 leg up has unfolded in a black 5 wave impulsive sequence.
21. The red boxes show how the blue Wave 5 advance, about equal to the blue Wave 1 advance, unfolded in the 5 wave impulsive sequence marked as shown.
22. The expected top in this market is consistent with recent discussion in other markets in the complex.
23. The action of today, which is not included in the CHARTS in this COMMENT, is consistent with expectations of an important top in this market and reversal in the COMPLEX.
2. We always want to be aware of those "Inversion Cycle Indexes" in the weekly pages of the April through September edition of "The 2006 $upertrader's Book of Linear Time Cycles" which is available in an easy-to-use electronic format. A sample of the format for the charting file may be seen in the NOTICE posted here. Ordering information here!
3. The initial issue of the free "Trading on the Edge" E-Zine was released 20001021. Archived copies are available here. Subscription information here.
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--Rutherford B. Hayes
