Sunday, April 4, 2010

Modification to Short resumption post

Even though the market turned to go short when I predicted, I now believe the long has a little further to go. A detailed analysis of the long leg that began on 3/25 and ended on 4/1 is simply the first leg of what will end up being an ending diagonal. Diagonals are 5 waves. So the current short will probably come down to about 1.5080 (but possibly deeper) and then the long will resume to push above 1.5297. That will be the third leg. I do not believe it will be a strong swift move long. It will look like a zigzag as that is exactly what each leg of an ending diagonal is. I have posted two charts the first labels wave 1 up and the second is an approximation of the ending diagonal.

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