Stock Market Highlight #17
Structure of the market suggests downmove.
(COMMENT # 649)
UPDATED 19980903
COMMENT 1998-649
1. In the stocks, the market appears to have rallied in 5 waves off Tuesday's 980901 low.
2. This suggests that the sideways movement with a "rough" high anticipated in
COMMENT # 633 of 980901 of around 7900 in the DJIA is likely something else EVEN THOUGH
price has moved sideways since our discussion which is as anticipated.
3. The reason is because we were expecting that we were in a complex "4th wave".
4. Such movements should experience a series of "3 waves".
5. Most likely is either 5 "3 waves" in an a-b-c-d-e "contracting
triangle" formation or an a-b-c where the "b wave" is lower than the low of
Tuesday, the "a and b wave" break down into 3 waves each, and the "c
wave", which completes the movement, finishes strong to the upside.
6. The 5 waves up from Tuesday's low changes all that.
7. The "5 up" pattern, IF CORRECT, signals that the upmove is either an
"a" of a "5-3-5" "a-b-c" sequence or that it is a
"first wave" up of more to come.
8. This latter expectation is not favored at the moment.
9. That leaves the "a-b-c" sequence until such time as the market tells us that
something else is going on.
10. Given the pattern since Wednesday's high, therefore, we have to conclude that we're in
a corrective "B wave" down.
11. If all this is correct, and if the "B wave" down is proportional, we should
end the "B wave" down around noon CST tomorrow.
12. 944 in the SPU would be ideal.
13. From that price, the ideal would be a strong "C" wave rally.
14. Again, in the ideal world, this "C wave" would be projected to end around
14:30 Tuesday afternoon.
15. A price level of around 1022 would be ideal.
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