Nasdaq A Correction Complete

wavetrader · #1 19th July 2006, 08:30 AM

Nasdaq Composite Long Term

The NASDAQ has just completed Wave 1 of 5 from the October '02 bottom. We have been trending in a contracting triangle since the beginning of '05. The e-wave crept out of the top of the triangle and gave a false thurst to the upside. Just as soon as it came out of the top of the triangle, it just as quickly collapsed down through the b-d trendline. When you look closely at the chart, you can see that the Composite actually gapped back inside of the triangle formation, which was a clue to the pending sell off that we have been experiencing over the last 2 months. Once we broke through the b-d trendline, we had a classic backtest of this line before dropping from 2200 to 2000 in a matter of weeks. Now that we have completed the triangle formation, we have begun a corrective move down to put in the 2 wave which will bottom in mid-October.

Nasdaq Composite Short Term

The Composite has put in it's bottom today with a low of 2012.78. This made for a total sell off of 365.54 points, representing a 15% haircut. Depending on the depth of the reaction from this rally, this will help us determine the pending doom into mid-October. Since the b-wave will retrace all or extend beyond wave-a, it will generate a Flat pattern. If the b-wave falls within 101-123.6% then the c-wave will 161.8% of wave-a. If the b-wave falls within 81%-100% of wave-a then wave-c will be 138.2% of wave-b. So, this gives us a potential target range of 1787 - 1873.

Good Luck Trading

manugoyal · #2 26th July 2006, 06:30 PM

Quote:

Originally Posted by wavetrader

Nasdaq Composite Long Term

The NASDAQ has just completed Wave 1 of 5 from the October '02 bottom. We have been trending in a contracting triangle since the beginning of '05. The e-wave crept out of the top of the triangle and gave a false thurst to the upside. Just as soon as it came out of the top of the triangle, it just as quickly collapsed down through the b-d trendline. When you look closely at the chart, you can see that the Composite actually gapped back inside of the triangle formation, which was a clue to the pending sell off that we have been experiencing over the last 2 months. Once we broke through the b-d trendline, we had a classic backtest of this line before dropping from 2200 to 2000 in a matter of weeks. Now that we have completed the triangle formation, we have begun a corrective move down to put in the 2 wave which will bottom in mid-October.

Nasdaq Composite Short Term

The Composite has put in it's bottom today with a low of 2012.78. This made for a total sell off of 365.54 points, representing a 15% haircut. Depending on the depth of the reaction from this rally, this will help us determine the pending doom into mid-October. Since the b-wave will retrace all or extend beyond wave-a, it will generate a Flat pattern. If the b-wave falls within 101-123.6% then the c-wave will 161.8% of wave-a. If the b-wave falls within 81%-100% of wave-a then wave-c will be 138.2% of wave-b. So, this gives us a potential target range of 1787 - 1873.

Good Luck Trading

Am I correct in assuming that 1787 - 1873 would be hit by October this year?

thanks
m

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