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Mix-Ansicht- EWI-UPDATE - SportiSteffen, 17.05.2001, 12:18
EWI-UPDATE
Aus dem kostelosen Bereich von www.elliottwave.com
Update for Wednesday, May 16, 2001; 6:30 PM, Eastern.
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[ANNOUNCEMENT]: Our IT department tells me that we had a server problem around 6:45 pm last night and some of you may not have been able to read last night's Special Short Term Update. We apologize and think we have the problem fixed. If you want to read last night's Update, go to the Update page on our website and click on the Archive tab at the top. We store the previous three Updates in PDF format and you can read them there. We hope you have enjoyed these Updates. If you are using our Free Week and are interested in subscribing, please follow this link for instructions: http://www2.elliottwave.com/specialoffer/freeweek.htm --SH
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The S&P's just emerged from their tightest five day trading range this year: Elliott was one of the few methods that told you the next significant move would be a sharp thrust higher. In last night's Special Short Term Update we were able to identify the sideways consolidation in the NYSE Composite Index and S&P 500 as a triangle pattern (see EWP, p. 48). Elliott was one of the first (along with H.M. Gartley) to recognize that triangle patterns were merely pauses in the preceding trend. In this case, the triangle patterns traced out in the NYSE Composite and S&P were fourth waves within larger impulsive advances from the March 22 lows, respectively. Our near-term forecast was for"a small pullback sometime tomorrow" (to finish the triangle), then,"a sharp thrust up will carry the market to new recovery highs." Prices gapped lower at today's open, completing the triangle pattern. From there it was nearly straight up into the close, accommodating our forecast.
The NYSE Composite, S&P and Dow are now in fifth waves up from their respective March 22 lows. The fifth wave started at today's early morning lows. The internal subdivisions of this fifth indicate that it is not over; higher prices should be forthcoming. The Value Line Arithmetic Index actually pushed to a new all-time high today. The Dow Jones Composite appears ready to join the Value Line in new high territory in the next day or two. Our top view remains that the Dow holds a better than even chance of also joining these indexes at new all-time highs this year. The NASDAQ has virtually no chance of doing so, though its bear market rally should be large in percentage terms.
At 11:15 am Eastern, the [Dow Jones Industrial Average] gave us the"rally above 10995 (May 7 high) to indicate that Minute wave five up is underway." The index easily blew through trendline resistance of 11030-11050, a testament to the strength of the underlying trend. As we said last night,"the key will be to see five waves trace out in Minute five, which will indicate it is over." Five waves up are NOT over, which means that the index has further to go to the upside. However, prices are very overbought and our chart indicates that the index is bumping up against some trendchannel resistance within the rally from the March 22 low. But market tops die of exhaustion as the underlying technicals deteriorate: this is not the case as of today's close. The NYSE advance/decline ratio was solid, though not spectacular for a 343-point up day. Two stocks rose for every one that declined. NYSE up volume was over six times greater than down volume. There were 258 new yearly highs on the Big Board, the highest number since January 4 of this year. The CBOE put/call ratio closed at a neutral.64 and the 10-day remains at a neutral.665. And Lowry's Buying Power Index pushed to a new all-time high today, while the Selling Pressure Index dropped to its lowest level since the current rally began (www.lowrysreports.com). This demand/supply relationship within the market suggests higher prices still to come. We don't yet see any of the divergences expected at a significant high. So any near-term pullback should be a correction within an ongoing rally. This will remain the case unless the index breaks below 10950, a level which the Dow has no business being below if wave five is still underway. Minute wave five will be 62% times the length of Minute wave one at 11342, a potential resistance level. More important for our analysis is to see how prices act if they approach this level, and to watch the subdivisions of the advance to help determine where it will end.
The [NASDAQ] also appears to have ended its B wave correction at this morning's lows. Today saw a nice outside-up day throughout the NASDAQ complex, on strong volume. This is often a bullish chart pattern. The Dow was up 3.2% but the NASDAQ was up 3.9%, outperforming on a percentage basis. This is consistent with the message of our NASDAQ/Dow ratio chart (see Monday's Update), which suggests that the NASDAQ will start to show greater relative strength versus the Dow. Today's lows are key to the bullish case. The indexes should not even test these lows if wave C up is indeed underway. So bulls should use today's lows as key support for your stance. They are 1768.62 in the 100 cash and 2058 in the Composite. Wave C should carry the NASDAQ to first resistance of 2160-2228 in the 100 cash and 2406-2418 in the Composite. There is higher potential as the rally progresses, but we don't want to get ahead of ourselves. So near-term pullbacks can be used to position for this advance, keeping in mind that the indexes must hold above today's lows or something else is going on.
The [U.S. Dollar Index] fell hard the past two days, away from trendline resistance connecting the 119.07 peak (Oct. 26) and 117.82 high (Apr. 2). Our recent analysis remains intact. Intermediate wave (4) started at 119.07 and is tracing out a triangle, either contracting (with converging trendlines) or running (with a moderate new price high still to come in wave B). As long as prices remain below Monday's 117.34 high (May 14), the triangle is contracting (see EWP, p. 48). Wave C of the pattern started at 117.82 and has an outstanding support target of 110.80-112, which should be tested in the coming weeks. If the 117.34 high is violated, expect moderate new highs (above 119.07) as wave B finishes its final subdivisions. Today's steep sell-off tells us we should afford more weight to the former scenario (down now) versus the latter (moderate new highs).
[June Gold] recovered from the sell-off of the past few days to post a strong rally today. Yesterday's Bank of England auction of 20 tonnes of gold is now out of the way and the market appears to have digested it well. The entire rally from $255.80 (Apr.2 low) still looks choppy, with overlapping waves. There is simply no way I will label this an impulse wave in real time. That said, rarely will a market retrace more than 78.6% of a preceding move and continue in the direction of that move. For instance, the 78.6% retracement of the decline from $274.80 (Mar. 12 high) to $255.80 low comes in at $270.70. Gold's rally had stalled right at this resistance. Today's gap higher open and strong close has now carried prices above this retracement level. My experience is that when this type of price action occurs, prices are embarking on a move in the opposite direction. So today's action increases the odds that gold is in a larger bear market rally that is likely to carry above key resistance of $274.80 (Mar. 12 high), which in turn will open the door toward higher resistance of $287-$300. Still, the prudent course is to wait for confirmation of the move, which will come with a close above $274.80. Until then we will wait and observe, as there does not appear to be the type of set up at this juncture that warrants taking a strong stance.
[July Silver] experienced its strongest rise this year in today's trading session. Prices could be embarking on a larger bear market rally, but it is too soon to say with certainty. Despite today's strong advance, silver still remains beneath resistance of 452.5 (Apr. 24 high), which prices must break to signal that greater upside potential exists. Since the Elliott wave pattern is not clear at the present juncture, there are better opportunities elsewhere.
Next Update: Friday, May 18, 2001.
Steven Hochberg, Editor
<ul> ~ ELLIOTT WAVE INTERNATIONAL</ul>
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