DuncanParker
Short

Mapping Out the End Game of IWM eWave 3

BATS:IWM   ISHARES RUSSELL 2000 ETF
399 5 3
I've been a vocal (probably obnoxiously vocal) doubter of the Russell 2000 for the last two weeks. I've also been very wrong! A longer-term perspective presents IWM             has "Pinocchio'd" above upward channel resistance - although it did not close above resistance today (Friday, July 12th) and put in a rather bearish "hanging man" candle, this hasn't mattered to Mr. Market or Uncle Russ             . Relative Strength is the market's equivalent of unconditional love, it trumps all. You'll notice my Elliot Wave count isn't implying this rally is over, far from it actually. We're in the final days of establishing eWave 3, the longest and most powerful Elliot Wave . Due to having poked through upper resistance, we're likely to attempt a tag of the parallel upper trend channel in the coming week - although I think we'll come just shy (I see 106 as the top).

The implied 25% decline from highs to around $79 (previous major resistance - now support) will come fast and without much warning. At this point I cannot foresee a catalyst that would cause such a severe sell off. However, honey badger don't give a @$#%. By approximating the angle of decent from eWave 1 to eWave 2 I'm assuming an upward turning-point and tag of the bottom trend-line support this coming September. Should support hold, I believe we will see a true "face-ripping" 11 month rally that will take IWM             to new highs near $120. This handle is significant for two reasons; confluence of trend line intersection and also a 100% measured move of eWave 1 added to the estimated eWave 4 low -- the classic technical projection method of Elliot Wave analysis.

Good luck out there!
Year longer to reach the end of eW 3 than I thought, but thesis remains. Should see one more wave higher off lower TL eW4.
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Need a spike through the upper bollinger band as a reversal clue - still waiting for $106. This chart received major recognition from Raymond James' Jeffrey Saut this (Monday) morning. Very cool!!! http://www.raymondjames.com/inv_strat.htm
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stalking this bearish move as well
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Awesome analysis! Let's see how this plays out
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Thanks very much! eWave 5 target could be optimistic, we shall see! Putting on the "angry bear" hat for now.
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