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Fractal is traced at B high which is identified by a dashed red vertical line. Bearish AB=CD price pattern is traced at this high. RSI14 CND is traced at this high. Retracement analysis reports resistance to higher price at Fibonacci 38.2. Do these objective indicator tracings, price pattern and Fibonacci study establish the conclusive high of wave B? Probably. What additional objective tracings are required to conclusively establish wave B high in this period? Price movement from Wave A to B was an uptrend motive wave. This motive wave had an a, b and c subparts to Wave B high. Each of those subparts had three wave subpart components as marked. All of the subpart highs and lows were identified by fractals. Subsequent to Wave B high price has since traced a partially completed lower fractal (see the chart) which when complete will be identified as wave (a) of longer term wave C. Presently price is tracing wave (b) the fractal high of which has not been conclusively established. This wave (b) fractal high must close below wave B. See the historical fractals subparts which occurred between wave a and b in 07' to 08' down cycle. These fractals trace an example of a trend change from up to down. Wave A to B an up cycle. Wave B to C a down cycle. Price may not be conclusively established in wave C (down) until sub wave fractals a and b close below the high of Wave B. This requirement has not been fulfilled in the monthly period. Review of shorter time frame charts helps in understanding tracings which will likely occur in longer period charts. Weekly; (NASDAQ) Blue dashed horizontal line at 2888.3 represents Wave B high and Fibonacci retracement 38.2 probable resistance to higher price. In the weekly period bulls have unsuccessfully assaulted this resistance level six times during the last 4 years. Two weekly fractal highs below this level in 07' (10/7/07 and 10/28/07) and four more weekly fractals recently shown on this chart. 38.2 resistance is created in the monthly period based on price data exclusively and is an objective recognition of the weakness of bulls and strength of bears. Ultimately price is expected to close below the low of Wave A. Fractal studies; Wave B fractal (brown vertical line) high. Wave a fractal (green vertical line), motive in the direction of the trend/down. Wave b fractal (red dashed) countertrend. Wave c fractal (blue vertical line) motive in the direction of the trend. Later wave c (red dashed vertical line) countertrend. These vertical lines will be better visualized in shorter time frame charts. They will remain of the chart since they identify EW locations. These vertical lines identify the location of RSI and MACD positions and values at various important EW highs and lows. RSI traced a complex W below 30 in 08' which implies price will later close below that price low. Price and EW tracing subsequent to Wave B high is important. Price has traced lower EW fractals subsequent to Wave B. This price pattern will most likely later be traced in the monthly period. The weekly tracing is confirming the likely high of wave B. The weekly period will first trace a countertrend (a, b and c waves) higher to wave (b) in the monthly which must close below longer term Wave B. Daily and 4 Hour; These charts allow examination of indicators and fractal locations at each of the vertical lines (EW high or low). The 4 hour period traces a n active RSI complex W below 30 suggesting lower price incident in wave c. Comments; Currency trading no longer allows hedging. However hedging of NASDAQ via SQQQ/short and TQQQ/long is permitted. When uncertain of entry equal amount in each ETF may protect against poor timing. Once the trade moves in the anticipated direction of the EW traded the other ETF is closed. Loren ------=_NextPart_001_004F_01CC869D.249DA380 Content-Type: text/html; charset=US-ASCII Content-Transfer-Encoding: 7bit  
[Attachment(s) from Loren Morlan included below]

Monthly; (QQQ  surrogate for the NASDAQ)

Price has probably traced the high of corrective wave B in this period.   Fractal is traced at B high which is identified by a dashed red vertical line.  Bearish AB=CD price pattern is traced at this high.   RSI14 CND is traced at this high.   Retracement analysis reports resistance to higher price at Fibonacci 38.2.  Do these objective indicator tracings, price pattern and Fibonacci study establish the conclusive high of wave B?  Probably.  What additional objective tracings are required to conclusively establish wave B high in this period? 

 

Price movement from Wave A to B was an uptrend motive wave.  This motive wave had an a, b and c subparts to Wave B high.  Each of those subparts had three wave subpart components as marked.  All of the subpart highs and lows were identified by fractals.  Subsequent to Wave  B high price has since traced a partially completed lower fractal (see the chart) which when complete will be identified as wave (a) of  longer term wave C.  Presently price is tracing wave (b) the fractal high of which has not been conclusively established.  This wave (b) fractal high must close below wave B.  See the historical fractals subparts which occurred between wave a and b in 07’ to 08’ down cycle.  These fractals trace an example of a trend change from up to down. 

 

Wave A to B  an up cycle.  Wave B to C a down cycle.  Price may not be conclusively established in wave C (down) until sub wave fractals a and b close below the high of Wave B.   This requirement has not been fulfilled in the monthly period.

 

Review of shorter time frame charts helps in understanding tracings which will likely occur in longer period charts.  

 

Weekly; (NASDAQ)

Blue dashed horizontal line at 2888.3 represents Wave B high and Fibonacci retracement 38.2 probable resistance to higher price.   In the weekly period bulls have unsuccessfully assaulted  this resistance level six times  during the last 4 years.  Two weekly fractal highs below this level in 07’ (10/7/07 and 10/28/07) and four more weekly fractals recently shown on this chart.  38.2 resistance is created in the monthly period based on price data exclusively and is an objective recognition of the weakness of bulls and strength of bears.  Ultimately price is expected to close below the low of Wave A.

 

Fractal studies;  Wave B fractal (brown vertical line) high.  Wave a fractal (green vertical line), motive in the direction of the trend/down.  Wave b fractal (red dashed) countertrend.  Wave c fractal (blue vertical line) motive in the direction of the trend.   Later wave c (red dashed vertical line) countertrend.  These vertical lines will be better visualized in shorter time frame charts. They will remain of the chart since they identify EW locations.   These vertical lines identify the location of RSI and MACD positions and values at various important EW highs and lows.

 

RSI traced a complex W below 30 in 08’ which implies price will later close below that price low. 

 

Price and EW tracing subsequent to Wave B high is important.  Price has traced lower EW fractals subsequent to Wave B.  This price pattern will most likely later be traced in the monthly period.  The weekly tracing is confirming the likely high of wave B.  The weekly period will first trace a countertrend (a, b and c waves) higher to wave (b) in the monthly which must close below longer term Wave B.  

 

Daily and 4 Hour;

These charts allow examination of indicators  and fractal locations at each of the vertical lines (EW high or low).  The 4 hour period traces a n active RSI complex W below 30 suggesting lower price incident in wave c.

 

Comments;

Currency trading no longer allows hedging.  However hedging of NASDAQ via  SQQQ/short and TQQQ/long is permitted.   When uncertain of entry equal amount in each ETF may protect against poor timing.  Once the trade moves in the anticipated direction of the EW traded the other ETF is closed.

 

Loren

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Attachment(s) from Loren Morlan

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