Tuesday, February 23, 2010

3s of 3s Everywhere


Wave 3's are typically the strongest waves of a 5 wave sequence. At varying degrees, we currently see 3s within 3s converging in lots of markets:
  • The dollar is embarking on a colossal Wave 3 of 3, up.
  • Stocks are embarking on a W3 of 3, down.
  • Gold is converging on a 3 of 3, down
  • Silver is hitting a 3 of 3, down.
All are large degree waves, so give em a little time to swell, crest and break. As it happens, we'll know.

9:20am Update
Market Watch: "An unexpectedly sharp blow..."

Speak for yourselves.
Posted by fdralloveragain at 3:53 AM

12 comments:

  1. AnonymousFebruary 23, 2010 at 6:27 AM

    Any comments on the strikes going on in europe?

    ReplyDelete
  2. Jim SmithFebruary 23, 2010 at 9:41 AM

    Hi FDR,

    Pardon me for being a naive Elliott fan. Isn't wave 3 the strongest 'motive' side wave? Wouldn't it be taking the stocks much higher before wave 4 does the correction job?

    Or, does W3 of 3 means the C of the A,B,C while the 1,2,3,4,5 are already gone?

    In the bigger picture, could you please point where does the market stand today, in this graph?
    http://en.wikipedia.org/wiki/File:Elliott_wave.svg

    Thanks a lot!

    ReplyDelete
  3. fdralloveragainFebruary 23, 2010 at 10:10 AM

    "Pardon me for being a naive Elliott fan. Isn't wave 3 the strongest 'motive' side wave? Wouldn't it be taking the stocks much higher before wave 4 does the correction job?"

    Hi,

    Yes, that is correct. But 5-wave motives always push in the direction of the trend of current degree.

    3-wave patterns always move against the trend of current degree.

    So for example, during a common ABC correction (the main trend is down) youmight see a 5-wave A down, a 3-wave B up, and a 5-wave C down.

    ReplyDelete
  4. AnonymousFebruary 23, 2010 at 10:11 AM

    Great post on FICO.

    Should make all think twice about any debt

    staring into a gigantic Wave 3

    ReplyDelete
  5. fdralloveragainFebruary 23, 2010 at 10:17 AM

    "Any comments on the strikes going on in europe?"

    I worked in Europe for years. The EU is a disaster. By the time this bear market is over (decades), the EU will probably be dissolved.

    ReplyDelete
  6. AnonymousFebruary 23, 2010 at 11:36 AM

    "I worked in Europe for years. The EU is a disaster. By the time this bear market is over (decades), the EU will probably be dissolved."

    Could you elaborate on Europe? How do you see the Euro in the next months/years? Obviously you don't see it at all on longer term...

    ReplyDelete
  7. Jim SmithFebruary 23, 2010 at 11:38 AM

    Hi FDRAoA, (I just realized you might be getting annoyed when we address you as FDR!)

    Thanks for your quick response. OK, so since the current trend is bearish, the "motives" are bearish, and the corrections are bullish. That makes the wave 3 bad, and a reason to sink the market in a big way.

    Am also very interested in your comment on the EU. Before I moved to US some 2 yrs back, I've worked in NL for almost 10 years. Since I still hold a good amount of savings in cash in a bank there, I'm always curious (read:worried) about the EU and Euro's future. I've started thinking to convert all that money to USDs, and have it here (not in a bank, but a credit-union account). What would you advice?

    Thanks for this amazing blog, and sharing your eye-opening views with us. I really appreciate it!

    ReplyDelete
  8. fdralloveragainFebruary 23, 2010 at 12:19 PM

    On my EU remarks, I have no inside knowledge other my working knowledge of the political and economic tensions and attitudes at play.

    The incredibly positive-mania surrounding the Euro, even as it has been losing against the USD for nearly two years, is consistent with a crash in the making.

    It's also consistent with:

    http://fdralloveragain.blogspot.com/2009/12/usd-shape-of-things-to-come.html

    Add the anecdotes out of Spain, Greece, and Italy, and I think the people of Europe (and especially the UK) could face some really serious trouble.

    If history informs us....

    ReplyDelete
  9. AnonymousFebruary 23, 2010 at 3:17 PM

    FDR,

    Your thoughts on the Treasury Supplemental

    Financing Program announced today.

    What are they trying to do and does it have

    any impact on the macro picture of a

    large long deflationary depression.

    Thanks

    ReplyDelete
  10. hettygreenFebruary 23, 2010 at 5:36 PM

    1100, could it be we hardly knew ye? Or do we have some more swelling and cresting left to finish the move?

    FDR don't you think crude oil deserves a bullet point too?

    ReplyDelete
  11. fdralloveragainFebruary 23, 2010 at 6:25 PM

    "FDR don't you think crude oil deserves a bullet point too?"

    Yes, it's hard to keep up with all the selling opportunities in a global inferno.

    ReplyDelete
  12. AnonymousFebruary 23, 2010 at 6:29 PM

    I think EWI call for the dollar to retrace here will give equities another boost to challenge the highs before we really turn down. Or maybe we pull an 87 where the both plummet. The breadth was lame today and the volume was low as well to make a big deal of today. I assume it will be bought by JPM and the FED tomorrow or into the weekend. Trying to hang short has been miserable as this thing is so choppy, it would only make sense to see it all retraced tomorrow on Paulsons book sales or something remotely as ridiculous.

    ReplyDelete

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