The State Of The Evolution Of E-Wave
Please read this article from early 2012. This will tell you what I’m seeing long term…not what you expected eh?..at the end of it you will be read- ing probably the most important article about the state of elliott wave you have never seen before.
The huge article in 2012…pretty interesting stuff!
Here we go…
“..The bottom in March 2009, again was the FINAL BOTTOM before the bull market that started that month..”
“…The most insane 3rd wave target for the DOW, which I haven’t men- tioned in any of my videos and charts is the W3 that’s 1.618 X the per- centage gain of the W1. The first wave travelled 1.98 x 6500..which is al- most double. Take 1.98 and multiply that by 1.618 and you get 3.205X… If the low of 10,404 was the bottom of the W2, and the 3rd wave travels that distance a potential target could be 33,346(!)…”
I have decided instead of doing a video or chart to explain in detail why I believe the DOW or DJI will hit 20,715 or even 33,346(!) in the coming few
years. The videos people tend to fast forward because they are after all almost 10 minutes long and people would rather want to see text instead of listening for that long. Also, the reason why I want to do a long text de- scription of the long term DOW chart is because charts have limited space.
Anyway, here’s the detailed wave count of the DOW from 1987 to the peak in 2000 to the low hit in March of 2009, which I believe is the bot- tom of a big C wave after a flat that started way back in January 2000.
This is where I will start…the drop from approximately DOW 14,200
to 6500 was a pure 5 wave impulse that completed a Wave 2 flat that started back in January 2000. The reason I call it a Wave 2 flat is because how far we retraced…the first wave started at the bottom the year 1987 and ended in the year 2000. The .618 retracement level would have ended up being in the 6000-6500 range, and we bottomed right at 6500…it was one big ABC Flat Wave 2. I actually called this bottom right on the num- ber in one of my Youtube videos in late Feb 2009. Just go to wavegenius.com/proof and watch the video there if you want to see my ex- planation.
The C wave formed a perfect 5 wave formation down which is why I was able
to pinpoint almost the exact date and the exact level of the DOW’s ma- jor bottom. I believe this will be the FINAL bottom before what could be a multi- year or even multi-DECADE bull market.
Each wave was perfect, W1 from 14,200 to 12,200, W2 was close to .618 from the bounce at 12,200 to 13,100, the downward 3 was 1.618 X W1, the W4 was .382 of the W3 and the final 5th wave was close to the length of W1 (W1 = W5). The bottom in March 2009, again was the FINAL BOT- TOM before the bull market that started that month.
The RSI was the lowest since 2001, the slow stochastic was 0 and we had a pure 5 wave impulse down. RSI and Slow Stochastic used in tan- dem with Elliott Wave and Fibonacci is the main formula I’ve used for years to pinpoint the many bottoms that I’ve called for almost 12 years now…also the VIX also got close to record highs and the bull/bear ratio had an extreme amount of bears historically. These are the forms of tech- nical analysis that I’ve found the most reliable.
Now for the wave count of the bull market that started in March 2009. Yes, I said a BULL MARKET THAT STARTED IN MARCH OF 2009.
Basically, I believe that we got a pure impulse off the March 2009 lows from DOW 6500 to DOW 12,876 in 2011…each wave was perfect fibo- nacci and fit the standard length in each move. Yes, I said it was a PURE IMPULSE, and it
was the first wave (W1)
Within this new bull market impulse we ended up getting the W1, or the first wave from 6500 to approximately 8800 in the DOW. The Wave 2 was a perfect
3 wave ABC zigzag that retraced in an A = C from DOW 8800 to DOW 8200.
The 3rd wave from 8200 to approximately 11,250 was near 1.618 the length of the W1 which fits standard fibonacci length for a W3, and oc- curred in a 5 wave
extension. This is a standard move.
The 4th wave from 11,250 to approximately 9700 retraced about .382 of the 3rd wave rise from 8200 to 11,250 and occurred in a 3 wave pattern ABC
zigzag. This was the so-called flash crash.
The 5th wave is what gets me the most excited. The most common 5th wave patterns are W1 = W5 and .618 X W1 + W3. We got a precise .618 X W1 + W3 move from 9700 to 12,876. Take .618 x w1 + w3, tack on the length from
the low of the W4 at 9700 and you have a perfect 5th wave up.
Now after this impulse completed from 6500 to 12,876, we got the “European
Crisis” W2 zigzag.
W2 zigzags tend to retrace to the previous 4, and we ended up reach- ing the middle of the previous 4 around 9700-10,700. It occurred in a 3 wave pattern down with a short C wave. It was A wave = 12,876 to 10,600, B wave up to 11,700 and C wave down to 10,404. This was again a 3 wave zigzag off the
12,876 high to the previous 4.
Now the “pattern break” setup. If you’ve followed my site for the past decade you know that I trade a pattern which I’ve nicknamed the “pat- tern break W3.” Whenever I’ve seen this pattern in indices, stocks or cur- rencies, not only do we “go up” we actually HIT the 1.618 target that I set for it 80%-85% of the time. No kidding. For proof go to wavegenius.com/pdf and look at the PDF’s from 2009 and 2010. You’ll see that 80%-85% of the stocks had the 3rd wave pattern break setup and 80%-85% of those stocks hit the precise 3rd wave target or higher. I know it’s pretty insane, but there’s NO SLEIGHT OF HAND. I have the time stamp of each chart that I analyzed on the blogs.com
site and if I manipulated these results in any way it would be ILLE- GAL.
Anyway, the point is that 80%-85% of the time I see the “pattern break W3!!
we hit the 1.618 target or higher.
The pattern is like this..W1 impulse, W2 zigzag in 3 waves and a break above the top of the W1, which in this case is 12,876. We broke the pat- tern break
recently and are currently trading around 13,000 in the DOW..
The most conservative 1.618 golden ratio fibonacci target is 20,715. Take the distance from 6500 to 12,876 and multiply that result by 1.618. Add that
number from the low of the W2 at 12,404 and you end up with 20,715.
The most insane 3rd wave target for the DOW, which I haven’t men- tioned in any of my videos and charts is the W3 that’s 1.618 X the per- centage gain of the W1. The first wave travelled 1.98 x 6500..which is al-
most double. Take 1.98 and multiply that by 1.618 and you get 3.205X… If the low of 10,404 was the bottom of the W2, and the 3rd wave travels that distance a potential
target could be 33,346(!).
Just take a look at my track record for the past 10-12 years on my web- site wavegenius.com. You’ll see that not only am I 80%-85% accurate on my long
term forecasts, I’m also 80%-85% accurate with my trading. 80%-85% I make
a profit on a trade, and that’s pretty much the entire point of following the
stock market. To make money.
So my long term DOW forecast targets are both 20,715 conservatively and as high as 33,346 if it travels the nose bleed full length…
Dec 11, 2013 BIG “STATE OF THE ELLIOTT WAVE” Update.
When this article was written the S&P had just broke into the the 3rd wave that I was looking for and was sitting at around 1490 and had just begun the ascent to around 1811…here are my 4 big observations about the “state of elliott wave”…the excessive new power of the .382 upward Wave 4 retracement..the prominence of the 5 wave trading pattern down, where the reversal appears to happen a huge percentage of the time (I’ve had a bunch these 5 wave trades, and I don’t even remember the last time I had a loss with it)..the new 3rd wave grinder formation..and 1-2-3 no 4 no 5 formation…
As you guys now on my website, I see different formations every year that
evolve…here are my observations:
1.) The new 3rd wave design..specifically the “grinder” formation…I only begun to see this phenomenon late last year 2012, and the year
kicked off with one..here’s what it looks like…you get Wave 1, Wave 2, Wave 3 and .786 break followed by 1.00…and a BIG gap up rally…but that’s the kick off part of the 3rd wave..what happens after w1, w2, w3 and pattern break these days on a successful big gap rally is this: the mar- ket will grind very very slowly to the upside and incrementely…it’s very slow and very “chinese water torture” like for the bears, and any sudden bigger move will antagonize it…what’s funny is that this formation hits the full 1.618 golden ratio so frequently that it’s almost a no brainer 3rd wave when it happens…keep in mind when 1.618 hits, the corrective is fast…and this happens..this formation is NOT mentioned anywhere in Robert Prechter’s “The Elliott Wave Principle” book, and is a very note- able formation…
2.) What happens these days on full 1.618 moves in 3rd waves is this…Wave 1, Wave 2, Wave 3 RIGHT TO 1.618 on the NUMBER…followed by not Wave 4
to .382 and Wave 5..instead of 4-5 almost immediately there’s a full cor- rective
Wave 2 that can touch the full .618 retracement before reversing back the resumptionofthebullishmove. Thegoldenruleinthe“ElliottWave Princi- ple” blue book is that 1-2-3-4-5 MUST be formed to get an impulse.. with- out 1-2-3-4-5 there CANNOT be an impulse..if this is the case, why did earlier this year we got a Wave 1, Wave 2, Wave 3 formation that dove straight into a .618 Wave 2 and reversed…and formed higher highs..this
very formation occured in March 2013 of this year, and proceeded to climb all the way from around 1550 to 1811 that we’re seeing now. 1-2-3- 4-5 is NOT a golden rule for a bullish impulse these days. There were 3 VERY visible moments this year, where I saw Wave 1, Wave 2, Wave 3 that dove straight into a deep .618 W2…I warned everybody about it THREE times this year on a live video, and the moment we hit 1.618, KABOOM Wave 2 at .618 with no 4-5 up. I basically in essence can now call tops with very fluid accuracy as well…but I’m essentially the only one who can see it. It’s not a 100% formation guaranteed, but pretty damn close.
3.) One VERY huge recent development is the excessive power of the upward . 382 Wave 4…Who would have thought that the most ignored wave pattern, W4 would have so much power these days…I can name countless times where I was
like “we need a Wave 4 here let’s get .382 on the number and bottom this thing out…” please note…the upward 4 MUST NOT exceed .382 by large margin..I would only accept above .382 if there’s maybe .50 or $1 above that price these days…many of these W4’s have been dead on the number..followed by a 5th wave that’s wave 1 = wave 5, .618 X wave 1 + wave 3, or truncation..the truncations after 4th waves these days are get- ting more frequent and the reversal way more powerful. Remember .382 on the NUMBER that I calculate is important because the fourth wave would signal the termination of a downward 1.618 Wave 3, followed by the incredibly weak 5th wave..5th waves to note are very weak and easily
identifiable these days…why is this important? Because of this one HUGE formation….
4.) THE NINETY PERCENT TRADE SETUP!! Yes, guys I now have an incredibly powerful trading formation that’s very reliable…9 times out of 10 in 2013 has this formation been profitable and HUGELY profitable. Here’s another big point about it…The Elliott Wave Principle states this: ALL CORRECTIVE WAVES NEED TO BE THREE WAVES (Golden Rule)…this is NOT a golden rule anymore…guess what happens …..5 waves down is NOW a standard corrective wave! Yes guys…this is now a standard corrective Wave 2 formation…Shocking eh? Well believe me this shit works all the time…I can name multiple times this year where I saw wave 1, wave 2, wave 3, wave 4 RIGHT To .382 on the NUMBER followed by a 5th wave that’s . 618 X W1 + W3, wave 1 = wave 5 or 5th wave trunca- tion and KABOOM big bottom and massive reversal back to new highs…trust me when I say this…it works very very well…this very forma- tion occured on NASDAQ years ago in 2002, when I called THAT bot- tom, so it’s not old..it’s actually been changing every year, and now when I spot it, something very magical happens….beware Mr. Ted when he says “1-2-3-4-5 down Wave 2 forming.. .382 is exactly .382 now let’s see which of the common 5th waves form….” Beware bears…be- fucking..ware..
Those are the 4 MAJOR new developments in elliott wave that have broken all the so called “golden rules..”…There’s nothing golden if the el- liott wave
continues to evolve every year..in order for the market to develop the way it has, there needs to be slight changes in these patterns, but this year they have been very dramatic….i’ll bet Mr. RN Elliott if he was still alive would love to sit down and have a cup of coffee with me at Star- bucks to discuss his theories..but of course that won’t happen..he’s my match, but he’s resting in peace..
Also note, this massive book I’ve written will change EVERY YEAR, with a NEW State Of The Elliott Wave section like you’re seeing
now…not because I want to take all your guys money lol..but because elli- ott wave can evolve rapidly and break the golden rules very quickly..who would have though right? Observe with me what happens when these for- mations happen..it’s really freaking cool to see..but again, it’s usually when Mr. Ted the Wavegenius spots it and clearly nobody else…