Catching Knives...S&P 500 Crash Count

[Joanne98]

In Elliott Wave terms The S&P 500 is in wave 3 of 3 down. I will attempt to explain this in terms those not familiar with Elliott Wave can understand. Here goes:

Wave 3's are long and strong and unrelenting. They can be in either direction. When wave 3 is headed up, everyone is waiting for a pullback to get in. That pullback never occurs.

When wave 3 is down everyone wants a rally to either get out or get short. Those rallies either occur intraday or they do not occur at all.

Wave 3 of 3 is where everything you do is right or everything you do is wrong, depending on whether you are long or short. Playing for countertrend moves is highly unlikely to be a winning move for anyone but the extremely nimble.

With that backdrop, here is a chart of the S&P 500 with the wave 3 of 3 "crash count" highlighted.

S&P 500 Weekly Chart

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http://globaleconomicanalysis.blogspot.com/2008/10/s-500-crash-count.html