DAX

Hamilton

dax aug 12 2011

The DAX should drop further, the structure to date cannot possible be complete. At best just the a leg could be complete but even then as a minimum we should get a b and c.

The DAX has an interesting chart in that no other major index looks anything like it. Of course they all have the same ups and downs but they do not have this very distinct triangle pattern. That this is unique to the DAX is perhaps a hint that it is incorrect,  but one must keep an open mind at all times.     A triangle has at least 5 waves, 3-3-3-3-3 (in some cases it extends). All the waves in this chart appear to conform to the a-b-c structure for each leg, except wave B, the second one. It could be a 3-wave affair but superficially it certainly looks more like 5. If that detail is overlooked the triangle, so far at least, is legitimate. The respective sizes is also within the normal parameters.

E is not yet complete, it may fall short of a normal target or it may exceed it. Normal would be about 4500, the absolute low would be about 3600. The alternative count, which applies to almost all other indices would call for a much lower drop. Just something to keep in the back of your mind.

TSX and DOW

Hamilton

Clearly the Dow did not stay in the triangle, it is now more likely an a-b-c, more or less the original thought. We will see. In any case 4 days in a row, up and down more than 400 points has never happened before.

Concerning the TSX, I am wondering if another original idea might not apply, given the violent move. Do not think so but one cannot help but wonder.

tsx aug 11 2011 tsx aug 11 2 2011

On the left is the original idea . It was discarded because it took to long. On the right is the latest up-leg. Just like the Dow , 900 points up in 3 days is insane. It looks like a wedge but  short-term I am not going to guess.

OTC, Open Text.

Hamilton

June 2nd this was a sure sell at $65 . It had taken years to get out of a range and broke out at about $52, than it appeared to have completed either a simple 5 wave rise, or a wedge. This chart shows the wedge;

otc aug 2011

Earnings must have come out or something of that nature..in any case the stock is now down about 18%, half of it today. The immediate target , of course, is $35 0r $27.5, the base of the wedge. The only interesting thing about this stock is that there was a gap on the way up, and one on the way down. This leaves an island behind and chances are very slim, at least in the foreseeable future that you will see those levels again. The break of the trend-line at around $60 provided a good warning.