S&P update

s&p apr 25 2013

There was this fellow by the name of Walter Zimmermann of United-ICap in New York who makes a bear case for the S&P ( and the others, presumable) on BNN the other day. The basis for his call is the wave pattern, which he believes to be an expanding triangle wave 4 (of some super degree). He combines this EW concept with the adage of selling in may and going away, especially now that there are certifiable too many bulls around. He is ultimately looking for 400 even though the trend line runs at about 540. An expanding triangle requires 5 waves in total all of which must be 3-waves each. On that basis e down to 540 now would do the trick and complete the whole pattern in about 2016.       Then there is this other fellow who swears by the “Jaws-of-death” pattern. It cannot be termed Elliott Wave as it is not recognized by them. Anyway he starts the pattern with the big up move as wave a, which means that we have just finished, or almost finished wave e and are about to drop in a very nasty abyss.

     Then there are the real orthodox E-Wavers from Gainsville that literally wrote the book. To be safe they propose 4 distinct “possibilities” but reject all but one on the grounds of either size or the lack of an internal 3-wave count (specifically in wave c, which I disagree with!) in the individual waves. That leaves the count where the first a-b- is wave A, and the rise from the lows of 2009 to now forms wave B.This B-wave is topping obviously but still could go just a little higher to let the DJIA catch up. 

    They could all be wrong! Some might argue that there is no such thing as a triple top and this will just keep going. I would prefer to take the prudent path and get out. There are these IQ test that ask questions like this. In a series that goes 100% up –50 % down – 100% up – 50% down –100% up what comes next????