DAX Index outlook Dec 2011 using Elliott Wave Analysis

Posted on December 19, 2011 by Ramki

How bad can it get for the European stocks during this ongoing crisis? In particular, can Germany’s DAX index weather the storm? When one thinks back at how nicely the US stock markets performed during the last couple of years, I am probably going to be frightfully wrong with this analysis. Yet, you should be aware of how bad it can get if things go the way I have shown here.All I have done is to use my knowledge of the Wave Principle, and come up with one scenario. This scenario respects all the rules and guidelines that needs to be followed while using Elliott Wave Principle. However, the picture could change as we go forward, and hence you should be aware that this doomsday scenario is currently mostly academic. (Guess I have given sufficient room to escape your wrath if the index goes straight up!!)

Anyway, I have also illustrated how you could count the waves from the significant low posted by the DAX index in March 2009. At the very least you would have gained some insight at how the waves tie in with each other. Look at the charts in the same order as posted.
Happy New Year folks!

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Posted in DAX Index, European Indices | Tagged , , , , | 19 Comments

S&P500 Elliott Wave Outlook Dec 2011

Posted on December 18, 2011 by Ramki

S&P500 indexTwo things are clear from the attached chart. First, there is a reasonably good chance that we will go back and forth for a few more weeks, and it is possible that one particular rally will be relatively powerful. However, just when everyone starts to cheer, I suspect we will get some news that will be interpreted as detrimental to the market sentiment,and the index will come straight down to around 1020. Why is that? It is because of the way I have chosen to label wave A. It is made up of 5 waves, and we know that a correction cannot be made of 5s. We need to see a three-wave move.

Just for a moment imagine that I have labeled it all wrong, and the correction actually finished at the point marked A. What does that mean? It means we have embarked on a third wave, which should be steeper than the first wave. Also, the third wave should travel quite a distance! Given the current uncretainties in the market, this seems unlikely. Besides, the correction of the prior five wave rally that finished above 1350 seems inadequate.Thus, I am professing the view that we will see a move down to 1020 early next year.
Your next question is why am I anticipating a relatively powerful rally that will fail to live up to its promise? It is because the move that you see labeled in black as (a) was made of 5 smaller waves, and for the same reason I explained above, (that a correction cannot be made of 5 waves) we need to see a (c) wave posted. And because that set of (a)-(b)-(c) together is deemed a B wave of the next degree, we will see some traders left stranded up there. Let us see how all this turns out.
Happy new year, and best wishes to you and your families.

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Posted in S&P500 | Tagged , , , | 21 Comments

ICICI , L&T, and Unitech: Elliott Wave update of some popular Indian Stocks

Posted on December 18, 2011 by Ramki

I am going away on a two-week holiday,this time in God’s own country – Kerala, in a resort. So here is a small New Year’s gift for my friends in India.

Elliott Wave analysis of ICICI suggests that despite the adverse news surrounding this stock, an attractive buying opportunity is not far off. However, when you go bottom fishing, you should always start small, and add as it moves your way.ICICI Bank

Larsen & Tubro stock has already come off so much that many investors must be feeling some awful pain. Unfortunately, the outlook is not all that great. The head and shoulders formation was there for all to see and Elliott Wave analysis also points to a move down to at least 835.Larsen & Tubro Ltd

Finally, I took a look at Unitech, and here too there is almost 20% left on the downside. So buyers beware!Unitech India

Happy New Year!

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Posted in India | Tagged , , , , , | 33 Comments

Elliott Waves work in all time frames

Posted on December 15, 2011 by Ramki

Just a quick one, to catch your imagination.
Whether you are trading the weekly charts, or the 5 minute chart, Elliott Waves work wonderfully well. You just have to acquire a feel for it, and you have won half the battle. See this example of the INR (Indian Rupee) which has come down in a nice five wave pattern today. If you are a day trader, you can spot similar opportunities in almost all well traded stocks or currencies.
Enjoy.

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Posted in Inr | Tagged , , | 10 Comments

IBM: Elliott Wave Analysis

Posted on December 15, 2011 by Ramki

IBM: Elliott Wave AnalysisIn his recent update in Forbes, John Navin mentioned IBM as one of the old warhorse stocks that is providing leadership in keeping the market well supported. John has some very good instincts and is an engaged partcipant in the US stock market. My being removed from the center of action perhaps allows me to review a chart dispassionately, and when I looked at IBM, it was easy to spot many interesting Elliott Wave patterns. These are all labelled clearly in the attached chart for your reference, so I won’t bore you with repeating the same stuff.

Your key take away from my post today is this. When a five wave rally approaches the end of its fifth wave, you must get ready for a correction that will be BIGGER and last LONGER than the previous two corrections. Now wave 4 went from 185.70 to 158.60, or $27. I am willing to wager that after we finish one more upmove, we will get a fairly aggressive sell off that will be at least $27. More likely, the downmove will take us to around 159, which is a significant move for most traders, and even for investors.

My only worry is I have been having such a wonderful run with my calls on Gold, Silver, Oil, Euro, Caterpillar, Apple, Indian Rupee and others that IBM could turn out to be the ‘correction’ I will eventually experience! Anyway, you have the chart with my comments and you can judge for yourself where I could go wrong. Good luck.

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Posted in US Stocks outlook | Tagged , , , | 3 Comments

Elliott Wave Analysis of Deutsche Bank

Posted on December 13, 2011 by Ramki

Elliott Wave analysis of Deutsche Bank’s stock price chart suggests that the decline into January 2009 finished with an extended fifth wave. Of all the patterns that one can use to anticipate future moves, an extended fifth wave is probably the most reliable. (See for example, Fifth wave extensions can make you rich)

The attached chart shows you how the internal waves of Deutsche Bank’s stock price movements are all related to each other, and it is fascinating, to say the least. We have already seen a relatively quick recovery to around EUR 55.25, which is, in my opinion, just the first leg of the move required to correct the whole sell off. Elliott Wave theory suggests that extended fifth waves experience what is known as a double retracement. What this means is the trader (or investor) should be prepared for a retest of the fifth wave bottom (occasionally even an overthrow!) But once the second test of the low is achieved, we will see an even quicker recovery than the first rally. The earliest target for the recovery is put at the wave 2 level of the extended fifth wave. This comes at EUR72 (or USD95 using today’s exchange rate).

For those who wish to see a fundamental view on Deutsche Bank, I suggest stopping by at Tefris.com

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Posted in European Stocks | Tagged , , , | 2 Comments

Elliott Wave update on Crude Oil 12 Dec 2011

Posted on December 12, 2011 by Ramki

Crude Oil charts are showing tentative signs of fatigue after the run up from $74.95 to $103.37, a move of almost 38%. I am anticipating a correction back to around the $91 levels, but we need to be patient as there will likely be one more attempt higher first. Crude Oil traders need to keep a close watch going forward to see if we first get a dip to around $97 followed by a move back towards $103. If we get these moves, then the time to sell will be on any dip under $100 AFTER reaching 103. Your stops can then be placed above the high seen. This way you will be able to get an attractive risk-reward for the trade.

Elliott wave comments are given on the two charts you see here. As always, every update you see in WaveTimes is an opportunity to learn and reinforce your understanding the Elliott Wave Principle.

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Posted in Oil | Tagged , , , , | 10 Comments

Elliott Wave Comments on Gold outlook

Posted on December 4, 2011 by Ramki

Gold shows an extended fifth wave inside the C waveGold can plunge upon failure near the resistance lineIn my 29 November Elliott Wave commentary on Gold, I suggested that Gold would probably need to come down a bit before rallying. The reason was I was looking for a much sharper recovery than what I was seeing. However, the markets just fooled me. Sure it did come off to 1700, but it didnt quite get to 1662 again :( What happened there?
Well, as you can make out from the first Elliott Wave chart of Gold that you see here, we got an irregular 4th wave, which is a complex correction, and that pause sort of took me off the track. Still, all is not lost. We do have the making of an extended 5th wave, and usually that is a warning of a sharp correction. But beware of paying too much attention to the very short term charts! I have often warned you in this blog, (and if I remember correctly, also in my book “Five Wave to Financial Fortune”) that you can make decent money by trading the bigger waves. So what is my take in the bigger picture?

Elliott Wave analysis of the loger term Gold charts tells me that there is a reasonable chance for us to go dramatically lower, say to around 1310 during 2012. You should therefore start making plans to identify a good, low-risk selling level to capture that huge move (if and) when it happens. Of course, I hope to be around to give you my two cents worth at that time, but today’s Elliott Wave comments on Gold’s outlook is laying the foundation for that move. Just remember that you read it here first, and when others pick up the ideas and publish it, you know that they are also secret members of the Wave Times club!
Enjoy.

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Posted in Gold | Tagged , , , , | 17 Comments
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