Hello everyone,
I am very hesitant re; sharing this idea. I do hope by putting this out there, I will gain valuable feedbacks & perspectives that I otherwise would not have had.
I am fully aware that this is a bold statement to make: we have a recession coming up soon. In fact, I think the recession has already begun.
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This is a 2 week chart of DJI. It is impossible to fit everything in one screenshot- to keep the chart simple, I will be posting more detailed analysis in the updates below.
I will first share the conclusion of my analysis, and the rest of the post will be me justifying this idea.
- Conclusion: It is my opinion that we have finished the 3rd wave of the cycle and we are now in the fourth wave. The start of this cycle dates back to the autumn of year 1974. That is 44 years ago – it has been almost half a century.
From my analysis, this 3rd wave of the cycle began after the great recession of 2008, which would be the 2rd (corrective wave) of the first wave of the cycle.
- The evidence that has led me to believe the third cycle has ended are the following:
1. I counted out all the primary waves (in black) and their sub waves- intermediate waves(in blue).
2. For the minor subwaves of the intermediate waves of the 3rd and 5th primary waves of the third cycle, I labelled them in the enclosed boxes (in black).
3. The Fibonacci retracements of the first and third intermediate waves of the third primary wave in the third cycle are in magenta.
4. The Fibonacci retracements of the first and third primary waves of the third cycle are in black.
5. The price level $26616.7 (high of 2018) is in confluence with the primary wave 1-2 (of the third cycle) 2.618 Fibonacci extension – marked in red on the right.
6. Continuing the previous point, the price level $26616.7 is also in confluence with the primary wave 3-4 (of the third cycle) 1.618 Fibonacci extension level- marked with black on the right.
7. Continuing points (6),(7) – the price level $26616.7 is in confluence with the wave 1-2 1.618 Fibonacci extension of THE WHOLE CYCLE. Marked in green on the left. This 1-2 cycle extension dates back to price level of $570 in late 1974 and the high of $14198.1 dating back to mid 2007; the extension starts at $6470, which is the low formed by the end of the great recession in 2009. This low in 2009 marks the end of the second wave of the cycle.
8. Now the price has shown reversal signals from this Fibonacci clusters formed by 3 critical Fibonacci extensions, I have enough reason to assume the third wave of the whole cycle has ended. This third wave has taken almost ten years to complete.
9. For these reasons, I believe we are entering the fourth wave of the cycle. Entering a corrective wave, that is, a move to the down side, might be the start of a recession.
10. The Fibonacci retracement of the third wave of the cycle is marked in blue on the right. An a:b = 1:1 extension at the daily timeframe will give us a retracement to the .236 level.
Please do read through all the points and share your opinions.
I do not know where this correction will take us. It might just be a small one – to the .236 Fibonacci retracement level of the third wave of the cycle. Or it could be all the way to around $14166 – at the .618 retracement level. Only time will tell.
What would make this idea wrong?
A close above the previous high of $26616.7 – In that case, we will have to re-count.
AL.
A historic moment?
I am very hesitant re; sharing this idea. I do hope by putting this out there, I will gain valuable feedbacks & perspectives that I otherwise would not have had.
I am fully aware that this is a bold statement to make: we have a recession coming up soon. In fact, I think the recession has already begun.
-----
This is a 2 week chart of DJI. It is impossible to fit everything in one screenshot- to keep the chart simple, I will be posting more detailed analysis in the updates below.
I will first share the conclusion of my analysis, and the rest of the post will be me justifying this idea.
- Conclusion: It is my opinion that we have finished the 3rd wave of the cycle and we are now in the fourth wave. The start of this cycle dates back to the autumn of year 1974. That is 44 years ago – it has been almost half a century.
From my analysis, this 3rd wave of the cycle began after the great recession of 2008, which would be the 2rd (corrective wave) of the first wave of the cycle.
- The evidence that has led me to believe the third cycle has ended are the following:
1. I counted out all the primary waves (in black) and their sub waves- intermediate waves(in blue).
2. For the minor subwaves of the intermediate waves of the 3rd and 5th primary waves of the third cycle, I labelled them in the enclosed boxes (in black).
3. The Fibonacci retracements of the first and third intermediate waves of the third primary wave in the third cycle are in magenta.
4. The Fibonacci retracements of the first and third primary waves of the third cycle are in black.
5. The price level $26616.7 (high of 2018) is in confluence with the primary wave 1-2 (of the third cycle) 2.618 Fibonacci extension – marked in red on the right.
6. Continuing the previous point, the price level $26616.7 is also in confluence with the primary wave 3-4 (of the third cycle) 1.618 Fibonacci extension level- marked with black on the right.
7. Continuing points (6),(7) – the price level $26616.7 is in confluence with the wave 1-2 1.618 Fibonacci extension of THE WHOLE CYCLE. Marked in green on the left. This 1-2 cycle extension dates back to price level of $570 in late 1974 and the high of $14198.1 dating back to mid 2007; the extension starts at $6470, which is the low formed by the end of the great recession in 2009. This low in 2009 marks the end of the second wave of the cycle.
8. Now the price has shown reversal signals from this Fibonacci clusters formed by 3 critical Fibonacci extensions, I have enough reason to assume the third wave of the whole cycle has ended. This third wave has taken almost ten years to complete.
9. For these reasons, I believe we are entering the fourth wave of the cycle. Entering a corrective wave, that is, a move to the down side, might be the start of a recession.
10. The Fibonacci retracement of the third wave of the cycle is marked in blue on the right. An a:b = 1:1 extension at the daily timeframe will give us a retracement to the .236 level.
Please do read through all the points and share your opinions.
I do not know where this correction will take us. It might just be a small one – to the .236 Fibonacci retracement level of the third wave of the cycle. Or it could be all the way to around $14166 – at the .618 retracement level. Only time will tell.
What would make this idea wrong?
A close above the previous high of $26616.7 – In that case, we will have to re-count.
AL.
A historic moment?
This is a monthly view of the cycle