Tony Sun: Founder of KhronoStock.com
I am by no means an Elliot Wave expert. However, instead of debating whether or not the 2000 high is the big third (III) wave of the uptrend and the second top formed from 2001 to 2007 as the A and B phase of the fourth wave correction, why not bunch the double top portion together as part of a single big fifth (V) wave of the uptrend.
I think this makes sense since the second top formed is technically caused by artificial inflation created by the Greenspan bubble post 2000 to reinflate the economy.
If we do that, then that means we could possibly finished a grand supercylce that spans for more than 1 century and the great ABC correction following the fifth wave completed in October of 2007 is currently unfolding. Thus, we could be in the A phase of this correction.
So many EW principles were violated I don’t even know where to begin. I think you’re trying to make the waves fit ex-post-facto, rather than using the waves to predict as it happens.
Hindsight is always 20/20, even if you need glasses.
July 6th, 2009 at 9:49 pm
Yes I know so many rules were violated that is why I called a “crude way”. I just want to get across a point that perhaps investors who got into the markets at the 2007’s level may never recover their money since it will be a very long time until we see a DOW or the SP500 reaching their Oct. 2007 levels.
Also, I personally think the 2003 to 2007 rally is completely artificially thus should not be counted as a ABC correction at all.
I apologize if my counts angers strict and professional Elliot Wavers.
July 7th, 2009 at 9:23 am
Oh it doesn’t anger me or anything like that, it just seemed like you were trying to “make it fit” where it didn’t necessary seemed to fit.
Hey Tony,
What fundamental shift do you foresee in the economy for us to re-visit 300,200,100 on the s&p? Or better yet, using fundamentals of the economy, how can you justify a ABC correction on the grand supercycle scale?
July 6th, 2009 at 9:53 pm
Zees,
You know everyday we are getting closer to an official “Economic Depression” in terms of length of this recession. A recession lasting more than 2 years is technically defined as a depression and we are at its 19th month right now.
From a macro level, my observations tell me that a fundamental shift in consumer behavior is already taking place.
July 7th, 2009 at 1:07 am
on the 23rd month of this recession you just know world Governments are going to fudge whatever numbers they need to and simply say “it’s over”
July 7th, 2009 at 9:49 pm
HOLY COW. I would not want to live to see a ABC correction on a grand supercycle.
Like all Elliott waves The Grand Supercycle since 1776 can be subdivided into smaller waves. In this case the smaller waves are called Supercycles. The Grand Supercycle can be subdivided as follows. Wave 1 (motive) 1770’s-1830’s. Wave 2 (corrective) 1830’s-1850’s. Wave 3 (motive) 1850’s-1920’s. Wave 4 (corrective) 1920’s-1930’s. Wave 5 (motive) 1930’s to early 21st century. [1] [2] Elliott wave theory predicts Wave 5 should be followed by a corrective ABC pattern, that is the largest economic recession since the 1770’s.
ABC 2007-?
I agree with Professor Cyan, so many EW rules are violated there. Your 2nd and 4th waves don’t exhibit any fibonacci relationships. I think you are trying to make an argument that we are in A wave of the Grand Supercycle.
July 6th, 2009 at 9:55 pm
I am. I think we are right now in the A phase of a huge ABC correction to the Grand Supercycle from late 19th century to 2007.
I have no doubts my counts have numerous violations.