... Okay I get yah now. Other than I don’t buy the Oct 07 peak (flat out disagree), here is what is wrong with your prognostication. X-Y-Z only occurs in triple-three corrections—-either triple-zigzags or triple-flats ...
Is 3-3-5 flat not a combo WXY (noted you use XYZ, thot the convention is to use WXY).
cramar - 03 December 2008 03:46 PM
... Cycle wave I started 1997.5 until early 2000 and ended around $38. Wave II took until late 2002 and ended around $5-$6. Thus began Cycle wave III in late 2002 and ended in Dec 2007 at $203. I can see five clear waves in III, with Primary 1 ending at around $45 in early 2005, Primary 3 ending early 2006, then a parabolic blow-off Primary 5 ending in Dec. 2007. So far, Cycle wave IV has traced out a simple A-B-C, but has not violated EW principle by entering the territory of Cycle I at $38, nor even Primary 1 at $45!
Visually, Primary wave 3 is the shortest wave, though is not numerically. A log graph like this lifecycle chart for AAPL show this clearer. Wave 3 can’t be the shortest wave.
Primary 1=$6.36 (Apr 16, 03*) to $45.44 (Feb 05). Length=$39.08.
Primary 2=$45.44 to $33.11. Ret=31.6% of 1.
Primary 3=$33.11 to $86.40 (Jan 12, 06). Length=$53.29.
Primary 4=$86.40 to $50.16. Ret=68.0% of 3. More than 50% .
*Can use Oct 02 too since it is launch month of iPod. Oct 02’s price is about a dollar more.
Wave IV does not often retrace Wave III by more than 50%. It is highly unlikely that $202.96 to $79.14 is a wave IV since $79.14 is more than 50% of any impulses from 0 to $202.96? In fact is almost 61.8%, a typical wave two retracement.
Hence, your count is counter-intuitive from EW perspective. Wave four retracing more than 50% and retraces more than wave two is not a normal EW wave behavior.
chinabox,
Heard of a failed flat and a zigzagflat. Compare the wave pattern from $85 to $112.19 with those show in this.
Heard of a failed flat and a zigzagflat. Compare the wave pattern from $85 to $112.19 with those show in this.
...
Mace, updated 60 days hourly chart to zoom in $85 to $112.19 movement and before. Please,” forget” notation before $85.00 and spot on wave construction… we agree this patterns look complex and hard to read, right?... After that look the mirrored image here: If this was a bull market the count I am proposing should be very clear, $95s would be the most probable support (resistance) and $75s would be a very probable target for the 3rd wave up (down)...
Do you understand now why I am not sure about $112.19 as the end of w4?
Yes, what I labeled as origin-w1-w2 can be read as abc, but the idea remains the same: is hard to read a bear market when you want to terminate it, all we need is more patience.
... Do you understand now why I am not sure about $112.19 as the end of w4?
Yes, what I labeled as origin-w1-w2 can be read as abc, but the idea remains the same: is hard to read a bear market when you want to terminate it, all we need is more patience.
I see what you mean. If the count is correct, we should see an impulse from $79.14 that would complete at either $105 or $116 to form a flat. $95 is a bit early. Right?
Just when I thot this Greenie guy is a rare bull, he makes this remark today “I now see SPX=650 as a real possibility and may come before SPX gets over 900. Earlier I thought SPX would rally for a couple of months and then decline. Here is the problem. Every time the market goes up little bit, too many bottom pickers show up to the party. Even though the market is down ~50% over a year, people just do not give up. Check sentimentrader IT sentiment today. I did not expect it to turn bullish so fast given that the news is so grim.” The last statement is against well known stock market axiom, when market rallies despite bad news is bullish.
FWIW, Louis Navieller says is Cat 5 for many blue chips. HPQ, IBM, MSFT and GOOG are named. No mention of AAPL. Noted those four stocks closed lower than yesterday.
... Do you understand now why I am not sure about $112.19 as the end of w4?
Yes, what I labeled as origin-w1-w2 can be read as abc, but the idea remains the same: is hard to read a bear market when you want to terminate it, all we need is more patience.
I see what you mean. If the count is correct, we should see an impulse from $79.14 that would complete at either $105 or $116 to form a flat. $95 is a bit early. Right?
...
FWIW, Louis Navieller says is Cat 5 for many blue chips. HPQ, IBM, MSFT and GOOG are named. No mention of AAPL. Noted those four stocks closed lower than yesterday.
That is right, $105 is really near after yesterday close, today and Friday will be very interesting.
Boys,did you notice some new feeling for the stocks?, Not talking about Greenie but others: there is an insistent whispering: “so cheap, so cheap”...
Mace, can you post the link to Navieller’s article on HPQ and others… went to the web, but can not find it. Thanks
... Mace, can you post the link to Navieller’s article on HPQ and others… went to the web, but can not find it. Thanks
Is an email. Relevant extracts:
“blue chip stalwarts, from IBM to Microsoft and Alcan to Wal-Mart ... in danger of dropping like rocks in the next 6 months! ... Beyond
the Credit Crunch ... is not over, despite the recent post-election rally, despite the bailout and despite the promises of a fresh team in Washington.
The credit crisis was simply the latest domino. First it was housing, then it was credit, now it is global, next it is retail then energy, commodities and technology and on and on until almost every sector has been whacked! Black December Mutual fund redemptions. There are over $6 trillion in stock funds and these investors are dumping their funds—forcing managers to sell at any price. Tax selling. As funds are sold, capital gains are triggered—in spite of losses. That triggers more selling, to pay the taxes. Margin calls. Many CEOs own their stock with debt. They’re getting thrombotic margin calls, which forces them to dump other stock to keep their own. Those margin calls are what is behind these vertiginous drops late in the trading day. Hedge fund panic. Managers get no bonuses if their hedge fund makes no money, so many are selling up and closing doors. Meanwhile investors in hedge funds are fleeing, forcing more indiscriminate selling.
Trillions are still tied up in this deleveraging. The epic unwinding will damage many of the more fragile blue chips.
In nutshell, is a repeat of Sep and Oct forced selling and fund redemptions + tax selling (yearly affairs).
Can’t picture your sarcasm. Btw, Louis hinting that those stocks in retail, energy, commodities and tech sector would decline to 5% to 10% of their ATHs just like financials. That is, at least 60% more haircut. Wonder why he didn’t mention AAPL since it is both a retail and tech stock.
Short-term EW of AAPL: Is $85.60 to $96s, a three-wave or five-wave structure? Look like a five-wave but $96.23 to now look like a descending wedge, a typical wave four pattern. If it is a wave four, AAPL shouldn’t decline below $91.80 before rallying above $96.23. Below is the updated count :
(i) or a=$79.14 to $94.79 (PM price is $95.56). Length=$15.65.
(ii) or b=$94.79 to $86.50, 50.5% ret
In (iii) or c. Obviously, targets for c are $95, $105 or $112.
(iii).[1]=$86.50 to $91.90. Length=$5.40.
(iii).[2]=$91.90 to $88.69, 59.5% ret.
(iii).[3]=$88.69 to $96.23. Length=$7.54.
(iii).[4]=$96.23 to $92, completed?
Can’t picture your sarcasm. Btw, Louis hinting that those stocks in retail, energy, commodities and tech would decline to 5% to 10% of their ATM just like financials. That is, at least 60% more haircut. Wonder why he didn’t mention AAPL since it is both a retail and tech stock.
Short-term EW of AAPL: Is $85.60 to $96s, a three-wave or five-wave structure? Look like a five-wave but $96s to now look like a descending wedge, a typical wave four pattern. If it is a wave four, AAPL shouldn’t decline below $91.80 before rallying above $96s.
Not sarcasm: It is just the fascination in front the catastrophic scenario, you know, like those ones looking Mt. St. Helen exploding while their legs was frozen…
Short-term EW of AAPL. Completely agree: five-wave for me ( 2nd was expanded flat?), after that descending wedge, right… so now it is up
edit:
f**k, to fast, it was zigzag+DW, so next was DOWN again, and not up…$89s is a good support area, lets see where it goes at the close: $91.20, well, ideas?... just seat and wait.
... Okay I get yah now. Other than I don’t buy the Oct 07 peak (flat out disagree), here is what is wrong with your prognostication. X-Y-Z only occurs in triple-three corrections—-either triple-zigzags or triple-flats ...
Is 3-3-5 flat not a combo WXY (noted you use XYZ, thot the convention is to use WXY).
Sorry missed the W. However, W-X-Y is a modern variation (never defined by Elliott), and is in a complex combination wave such as a double zig-zag or flat. My conclusion stands that I find it awesome that you can predict the pattern of a complex corrective wave years in advance.
Mace - 03 December 2008 05:25 PM
cramar - 03 December 2008 03:46 PM
... Cycle wave I started 1997.5 until early 2000 and ended around $38. Wave II took until late 2002 and ended around $5-$6. Thus began Cycle wave III in late 2002 and ended in Dec 2007 at $203. I can see five clear waves in III, with Primary 1 ending at around $45 in early 2005, Primary 3 ending early 2006, then a parabolic blow-off Primary 5 ending in Dec. 2007. So far, Cycle wave IV has traced out a simple A-B-C, but has not violated EW principle by entering the territory of Cycle I at $38, nor even Primary 1 at $45!
Visually, Primary wave 3 is the shortest wave, though is not numerically. A log graph like this lifecycle chart for AAPL show this clearer. Wave 3 can’t be the shortest wave.
Primary 1=$6.36 (Apr 16, 03*) to $45.44 (Feb 05). Length=$39.08.
Primary 2=$45.44 to $33.11. Ret=31.6% of 1.
Primary 3=$33.11 to $86.40 (Jan 12, 06). Length=$53.29.
Primary 4=$86.40 to $50.16. Ret=68.0% of 3. More than 50% .
*Can use Oct 02 too since it is launch month of iPod. Oct 02’s price is about a dollar more.
Wave IV does not often retrace Wave III by more than 50%. It is highly unlikely that $202.96 to $79.14 is a wave IV since $79.14 is more than 50% of any impulses from 0 to $202.96? In fact is almost 61.8%, a typical wave two retracement.
Hence, your count is counter-intuitive from EW perspective. Wave four retracing more than 50% and retraces more than wave two is not a normal EW wave behavior.
.
The count I offered is one way of counting. Under Elliott rules that cannot be violated (or the count is wrong) are that:
1) Wave 3 cannot be the shortest (in price) wave. In my example it is not.
2) Time does not enter into it, only price. Therefore being visually shorter does not violate the rules.
3) Wave 4 cannot retrace INTO the territory of Wave 1. There are no rules that 4 cannot retrace more than 50% as long as Wave 1 is not violated.
Actually there is a better count I just noticed. Primary 1 started late 2002, and ended in early 2003. Wave two corrected for a couple of months then parabolic Primary 3 started then. Three clear waves up to beginning of 2006 at approx. $85. (Intermediate wave (4) is a triangle—the ideal spot). Then a Primary 4 down to $50. From later 2006 until $200 is the Primary 5 blow off to complete the wave sequence. This is better than the first one I offered since Primary 2 is a lot bigger.
BTW, I am only putting the probability of 40% on this action in the last year as a Wave 4 which may or may not be completed. I’m just open that it could be.
EDIT: The log scale is interesting, but in the example you linked, can you put any meaningful count on the action since the 1980’s? I cannot. I think it muddies things.
I’ve similar understanding about EW rules. There are guidelines, unlike rules, could be broken. My count for your Cycle III is:
Primary 1=$6.36 (Apr 16, 03) to $12.51 (Oct 03)
Primary 2=$12.51 to $9.62 (Dec 03)
Primary 3=$9.62 to $86.40 (Jan 06)
Primary 4=$86.40 to $50.16
Primary 5=$50.16 to $202.96
Cycle III is therefore an extended fifth wave impulse.
According EW guidelines (not rules), since Cycle III is an extended fifth wave impulse, Cycle IV would complete within Intermediate ii of Primary 5 of Cycle III i.e. price zone $97.80 to $76.66. $79.14 is right inside this price zone. For extended third wave Cycle III, Cycle IV would complete near Primary 4 of Cycle III i.e. $50.16.
Hence, I hope you’re right that AAPL is in Cycle IV and Cycle III is an extended fifth wave impulse.
Now, what are the targets of Cycle V? Did you compute that?
0.618 of Cycle I
1.000 of Cycle I
1.618 of Cycle I
0.618 of Cycle I + III, about $200
1.000 of Cycle I + III, about $280, the illusive target that destroy many AFBer’s portfolio
1.618 of Cycle I + III, everybody love this, $400
Which one do you think is likely . Notice some price targets mean Cycle V is truncated . I decided to whip out the godly EW book “Mastering EW by Glenn Neely”. Glenn implied that when Cycle IV retraced 61.8% (max) of Cycle III, Cycle V would either be truncated or extended. If the fifth wave extends, Cycle IV should retrace a greater percentage of Cycle III than Cycle II does of Cycle I. Since Cycle IV retraces 61.8% of Cycle III, Cycle V is likely to be truncated i.e. less than $203 (good luck to Andy’s $230 and Gene’s $235).
chinabox,
Just receive another email from Louis advocating selling AAPL “I have to confess that I love Apple (AAPL)—the company; not the stock. I can’t think of an outfit that so consistently releases brilliant products. A few years ago, we saw that Apple was going for a nice discount, and we jumped. In just three years, Blue Chip Growth subscribers made a nice 252%! But those days are long gone. Apple’s earnings momentum has taken a turn for the worst, and the volatility is through the roof. That’s not the kind of action we need. Let Apple go, but I’m going to keep a close eye on it. When Apple is a buy again, I’ll be the first to buy it.”.
My guess he didn’t bother with non-GAAP. So until GAAP results caught up with non-GAAP or market realizes non-GAAP depicts Apple business more accurately, in the eyes of GAAP investors, earnings momentum has deteriorated. As for his track record on AAPL, he recommends buying AAPL around $26s (4x of $6.36 in 2003) and recommends selling AAPL when it is around $90s (wow, so far from $203s). Despite SJ song and dance, only AFBers and a couple of analysts bother with non-GAAP, how pathetic.
Short-term EW of AAPL:
(i) or a=$79.14 to $94.79 (PM price is $95.56). Length=$15.65.
(ii) or b=$94.79 to $86.50, 50.5% ret.
In (iii) or c. Obviously, targets for c are $95, $105 or $112.
(iii).[1]=$86.50 to $96.23. Length=$9.73.
(iii).[2]=$96.23 to $89.06, ret 73.7%, completed?
In (iii).[3] now?
chinabox - Descending wedge is not a wave four is b of a zigzag. Recall identifying the direction of entry into the wedge and not the wedge itself is most critical. Any alternative count to above? Could $79.14 to $96.23 is abc, now into another abc?
Short-term EW of AAPL:
(i) or a=$79.14 to $94.79 (PM price is $95.56). Length=$15.65.
(ii) or b=$94.79 to $86.50, 50.5% ret.
In (iii) or c. Obviously, targets for c are $95, $105 or $112.
(iii).[1]=$86.50 to $96.23. Length=$9.73.
(iii).[2]=$96.23 to $89.06, ret 73.7%, completed?
In (iii).[3] now?
chinabox - Descending wedge is not a wave four is b of a zigzag. Recall identifying the direction of entry into the wedge and not the wedge itself is most critical. Any alternative count to above? Could $79.14 to $96.23 is abc, now into another abc?
“The monthly chart shows a potentially completed full Elliott Wave Impulse from start to finish - it’s extraordinarily rare to see such a chart like this develop at the structure we are now in real time. If the impulse is indeed complete, that would signal the potential birth of a new Elliott Impulse in Apple - meaning we’re at the genesis of a potential first wave in a larger impulse.”
Thanks for the link. He has written what we’ve been talking about in this thread eloquently. He has the same confusion over whether $112.19 to $79.14 is indeed the completion of a wave five or part of an ending diagonal (he refers to it as a terminal wave). Relevant extract:
“I have a little confusion as to how to interpret the current Elliott count, so your opinions are welcome, but the question now becomes “Have we already completed fractal wave 5 at the November 23rd lows… or are we about to begin fractal wave 3 or perhaps 5 back down to complete officially the wave 5 decline?” What does that mean? We see Waves 1-4 completed rather orderly (and I could have drawn in fractal waves for the 3rd wave) but Wave 5 has already completed (with the slight price lows) or is in the process of forming a final terminal wave down (meaning it has not completed yet). Until we work off that condition, it might pay to be a little cautious and let price action prove itself over the next few days, but if the impulse is indeed complete, that would signal the potential birth of a new Elliott Impulse in Apple - meaning we’re at the genesis of a potential first wave in a larger impulse (reference the monthly chart above).”
Please refer to the discussion between cramar and me for the following comment: However, he is too sure that Cycle V would follow once $79.14 is confirmed as completion of wave C. ABC could be W and hence a counter-trend (up) wave X, a zigzag not an impulse, would follow. Cycle II took three years to complete and one would expect Cycle IV should take similar length of time. So far, Cycle IV=ABC took only slightly more than a year. Hence, my position remains that the likely scenario from here is a wave X peaking between $160 to $200.
I’ve similar understanding about EW rules. There are guidelines, unlike rules, could be broken. My count for your Cycle III is:
Primary 1=$6.36 (Apr 16, 03) to $12.51 (Oct 03)
Primary 2=$12.51 to $9.62 (Dec 03)
Primary 3=$9.62 to $86.40 (Jan 06)
Primary 4=$86.40 to $50.16
Primary 5=$50.16 to $202.96
Cycle III is therefore an extended fifth wave impulse.
According EW guidelines (not rules), since Cycle III is an extended fifth wave impulse, Cycle IV would complete within Intermediate ii of Primary 5 of Cycle III i.e. price zone $97.80 to $76.66. $79.14 is right inside this price zone. For extended third wave Cycle III, Cycle IV would complete near Primary 4 of Cycle III i.e. $50.16.
Hence, I hope you’re right that AAPL is in Cycle IV and Cycle III is an extended fifth wave impulse.
Now, what are the targets of Cycle V? Did you compute that?
0.618 of Cycle I
1.000 of Cycle I
1.618 of Cycle I
0.618 of Cycle I + III, about $200
1.000 of Cycle I + III, about $280, the illusive target that destroy many AFBer’s portfolio
1.618 of Cycle I + III, everybody love this, $400
Which one do you think is likely . Notice some price targets mean Cycle V is truncated . I decided to whip out the godly EW book “Mastering EW by Glenn Neely”. Glenn implied that when Cycle IV retraced 61.8% (max) of Cycle III, Cycle V would either be truncated or extended. If the fifth wave extends, Cycle IV should retrace a greater percentage of Cycle III than Cycle II does of Cycle I. Since Cycle IV retraces 61.8% of Cycle III, Cycle V is likely to be truncated i.e. less than $203 (good luck to Andy’s $230 and Gene’s $235).
Mace, I don’t usually try to compute Cycle V targets using Fib. calculations—only Fib. retracements. I have developed a geometric projection method which is far more accurate at projecting the potential termination of the next wave. But you have to know if the current wave has indeed ended. Still unsure. 50-50 at this stage.
Hey I like the idea of a truncated 5th! That is more realistic and still satisfies EW guidelines. BTW, Prechter is adamant that some rules cannot be broken. Like 2nd cannot retrace below the start of 1, and 4 cannot fall into territory of 1. If that happens then your count is flat out wrong.
“The monthly chart shows a potentially completed full Elliott Wave Impulse from start to finish - it’s extraordinarily rare to see such a chart like this develop at the structure we are now in real time. If the impulse is indeed complete, that would signal the potential birth of a new Elliott Impulse in Apple - meaning we’re at the genesis of a potential first wave in a larger impulse.”
Thanks for this Superbaka. His wave count and analysis is generally the same as mine—a “grossly extended” fifth wave. His count on monthly chart is the exact same as my original one,. However I now believe my count as posted last evening is more correct. It does not change anything long term, just pushes wave 1 much further back in time and makes wave 3 longer, but terminating at the same spot. I am cautious that this is not just a simple A-B-C, but will morph into something more complex, or more sinister.
I wish though, that he would date his article so that you know when this was posted.
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wave, though is not numerically. A log graph like this lifecycle chart for AAPL show this clearer. Wave 3 can’t be the shortest wave. 
.
of any impulses from 0 to $202.96? In fact is almost 61.8%, a typical wave two retracement.
:
. Notice some price targets mean Cycle V is truncated 
.
I decided to whip out the godly EW book “Mastering EW by Glenn Neely”. Glenn implied that when Cycle IV retraced 61.8% (max) of Cycle III, Cycle V would either be truncated or extended. If the fifth wave extends, Cycle IV should retrace a greater percentage of Cycle III than Cycle II does of Cycle I. Since Cycle IV retraces 61.8% of Cycle III, Cycle V is likely to be truncated 
i.e. less than $203 (good luck to Andy’s $230 and Gene’s $235).
