Professor’s Comments April 28, 2014 Update
Posted by OMS at April 28th, 2014
I believe there’s something worth looking at now on the 60 minute chart of the Dow (DIA).
After this morning’s early pop, the Dow has pulled back over 100 points. The early rise, together with the sharp pullback is not what you would expect to see if the markets were breaking out and starting the next impulse wave. If the impulse wave was underway, there would be no pullback.
So today’s early rise was likely something else.
On the other hand, if today’s early pop was the ‘b’ wave within wave 2, this morning’s early pop makes complete sense.
If you look at a 60 min chart of the Dow since 11 April, you can clearly see a 5 wave rally into the top made on 24 April. Since then the Dow has been retracing in what appears to be wave ‘a’ of 2. Today’s pop would be wave ‘b’.
If this is the case, the Dow should continue to pullback today and probably into tomorrow to complete the small a-b-c retracement pattern. If this happens, the odds are high that wave 2 is getting close to completion. Once complete, I believe the next thrust to 17,000 will begin.
In other words, we could be getting very close to the start of a major rally in stocks.
h
Not sure of the terminology we use? Check out these articles
The Hockey Stick Pattern
The Creation of Waves and Trends
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Category: Professor's Comments