Elliott Wave: Week of 12/17/18 - Start buying? Darker, or Dawn?
Since my first introduction (October) of the "abc" correction the question in my mind has always been "and then what?" Decreasing risk (positions, size) has been beneficial since October, but there is a time to reverse that process as the trend starts turning again. When is that expected as the decline's pivot begins?
Elliott Wave is excellent for anticipating wave duration and change. Unfortunately it is not precise, and is often poorly applied ( not by me :) ). However, it remains a major part of my analysis and personal positioning using trend movement. Sprinkle in corroborating technicals (Butterfly pattern, MACD, PPO, Fibonacci levels, trends) and a plausible picture is formed for planning risk levels and positions.
Throughout the correction the standard "abc" pattern has been used to target the decline's destination, whether the pattern morphed into a triangle, flat, etc. We now add a confirming Elliott Wave technique of wave "a" = wave "c" to target the correction's wave "c" end (a to b's bottom, then used with b's top to estimate c).
We now focus on wave "c" in progress (red) and target 2425 as a reasonable end. However, that is an ideal goal and not a certainty! Getting there includes hurdles at the lower trend line (yellow), and then the February low of 2532.
Adding risk and position size is a process, and I expect my initial loading to start at 2555. From there I will add more, whether we go up, or down. On the downside I expect to add more aggressively near 2425, while on the upside a cross of the 50d sma (red) or the 10d from below the 20d (not shown) will trigger adding to positions. In all cases the additions are at levels below the initial risk reduction during the correction's early phase of wave "a" in October.
Why here, and now? Risk becomes more favorable as the decline terminates. What follows is a higher degree wave as either "B" (not shown) after the initial lower degree "abc" (my primary read), or a new 5 wave impulse upward to new highs (not shown, alternate read). Both lead to an upward trend once the current "abc" completes. It is time to plan for a pivot as the current down trend concludes.
Lastly, I've done some housekeeping (thanks to reader comments) to move the top of wave "b" down to the actual recent high of 2816. I also tightened the zone for "Correction area for Wave from 11/2016" (green and yellow horizontal lines).
Elliott Wave is excellent for anticipating wave duration and change. Unfortunately it is not precise, and is often poorly applied ( not by me :) ). However, it remains a major part of my analysis and personal positioning using trend movement. Sprinkle in corroborating technicals (Butterfly pattern, MACD, PPO, Fibonacci levels, trends) and a plausible picture is formed for planning risk levels and positions.
Throughout the correction the standard "abc" pattern has been used to target the decline's destination, whether the pattern morphed into a triangle, flat, etc. We now add a confirming Elliott Wave technique of wave "a" = wave "c" to target the correction's wave "c" end (a to b's bottom, then used with b's top to estimate c).
We now focus on wave "c" in progress (red) and target 2425 as a reasonable end. However, that is an ideal goal and not a certainty! Getting there includes hurdles at the lower trend line (yellow), and then the February low of 2532.
Adding risk and position size is a process, and I expect my initial loading to start at 2555. From there I will add more, whether we go up, or down. On the downside I expect to add more aggressively near 2425, while on the upside a cross of the 50d sma (red) or the 10d from below the 20d (not shown) will trigger adding to positions. In all cases the additions are at levels below the initial risk reduction during the correction's early phase of wave "a" in October.
Why here, and now? Risk becomes more favorable as the decline terminates. What follows is a higher degree wave as either "B" (not shown) after the initial lower degree "abc" (my primary read), or a new 5 wave impulse upward to new highs (not shown, alternate read). Both lead to an upward trend once the current "abc" completes. It is time to plan for a pivot as the current down trend concludes.
Lastly, I've done some housekeeping (thanks to reader comments) to move the top of wave "b" down to the actual recent high of 2816. I also tightened the zone for "Correction area for Wave from 11/2016" (green and yellow horizontal lines).