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Saturday, October 5, 2013

Djia Long term cycle

I had start working on a long term cycle model a couple of years ago, only to have it disproved  after several attempts. The latest attempt at this most unusual cycle is shown below. The one thing that stands out is this is not what is referred to as an 'archetypal' type cycle. The monthly Elliott wave labeling should be (A) (B)  (III) with march of 2009 as an (IV). That would make the current wave structure a (V). The Composite is in an different structure.

The problems occur within the current wave 5 structure.The Timing of the current structure worked fine up to the point of  35 weeks for the spx and the 28th month for the djia. The weekly timing for the current structure for the wave 3 occurred at 113 weeks for the spx and 122 for the Dow. The wave fours were good for one half of the cycle timing. The second half of the structure should have waves 5 occurring at 2/8  of the cycles for each respectively. As a subsequent, the proposed 5th wave was labeled an (A) and (B).

Setting aside the timing of the cycle it appears that the 5th wave stretched to complete an Pattern Dr. McHugh calls the Megaphone pattern. It's slang for what Bulkowski refers to as an Broadening Wedge,
Ascending,page 81 in" encyclopedia of chart patterns". As we've learned from Tom is we need to be on guard for patterns that fail. In the current megaphone pattern that could occur at 5% over the break out level.
That would also match some fib projections and also complete some of the harmonic patterns I have been posting. The next dates to be concerning ( if I've figured correctly ) is around 11/11/13.(note: harmonic
patterns can fail like other recognized patterns.)

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