Elliott Wave update on Dow Jones: Internal Wave Count

One of the readers, Jim to be specific, has asked for the internal counts of waves (1) and (3)  of the wave count of the Down Jones Industrial Average that I had posted on 17 Jan 2010. He requested this because he wasn’t sure if they looked impulsive. As I have mentioned elsewhere, Elliott Wave Analysis is a flexible tool in the hands of the analyst. Counting the waves is more like art than a science. One could label these waves in a variety of ways and still come to the same conclusion. Again, one could count them differently and reach a completely different conclusion. What, then, is the “RIGHT” count?  Unfortunately, no one can be sure until the move is all over.  The only way to trade the markets using Elliott Wave Principle is to be faithful to any one count until the market signals that you are wrong. I have provided my internal counts of the Dow Jones Industrial Average in the attached chart. There are several Fibonacci relationships that you can observe between alternate and adjacent waves. Also, the three main rules governing wave principle are all respected. Hence, there is a reasonably good chance that I am on the right track. I always grant that I could be completely wrong, and will be more than happy to share my mistakes, not just because no one can claim complete mastery, but also because once I am corrected, at least my next trade on the Dow Jones will be on the right track!  Please feel free to share these comments and links with your friends. After all, this blog is meant to share our experiences in the market. With best wishes, Ramki