Final week, see , we used the Elliott Wave Precept (EWP) to find out the place the might doubtlessly high.
We anticipated,
“the orange W-3, 4, 5 sequences to finish over the subsequent few hours/days to ideally the above-mentioned extension [red W-c/iii = 1.618x a/i extension at $15170+/-5, which is close to the 76.40% retrace of the 2021 all-time high to the 2022 low.].”
And we warned,
“word we are actually speaking about essentially the most minor and probably closing wave of the rally because the late April low. So, danger administration is prudent at this stage. As soon as the orange W-5 completes, the pink W-iv? will seemingly kick in, bringing the value of the NDX again to ideally $14230, akin to the inexperienced waves 3 and 4 we mentioned. Then one other pink W-v to ideally $15565+/-75 ought to start.”
Quick ahead, and the index peaked final Friday on the open at $15284 after finishing the orange W-3, 4, and 5 sequences. See the pink circle within the hourly chart in Determine 1 under.
Determine 1. Nasdaq 100 hourly decision chart.
Our high goal was solely off by 0.65%, and now we’re on the lookout for the NDX to finish its correction between ideally $14250-14350 with a risk of going as little as $13685. The previous value goal zone is the place the inexperienced W-c/3 goal zone will get near the blue 61.80% stage, and the pink W-iv? goal zone. Thus, there’s good confluence in that area, which is commonly a magnet for the market, like the place final week’s high occurred.
The market is in a corrective section and ought to be in a counter-trend rally: inexperienced W-b/2. If the index drops under at the moment’s low, this wave has seemingly already ended as there are technically sufficient scribbles (gray W-a, -b, and -c) in place to contemplate it full: dotted pink arrow. We’ll then search for the inexperienced W-c/3. However, corrections of corrections are sometimes essentially the most sophisticated value buildings, so we will permit for one more small rally in direction of the $15050-15150 zone first earlier than W-c/3 commences: blue dotted arrow.
No matter the place exactly the inexperienced W-b/2 will high, we anticipated one other leg decrease, which ought to current us with a low-risk shopping for alternative for the pink W-v to ideally $15565+/-75 (inexperienced dotted arrow).
At this stage, we can not slim the inexperienced W-c/3 goal zone greater than proven as a result of we have no idea but if the inexperienced W-b/2 has topped and what the connection between W-a/1 and W-c/3 can be. Or in different phrases, we can not go searching two corners directly, though we now have a fairly good concept of what ought to lie round that 2nd nook.
Lastly, if we see 5 inexperienced waves decrease -why we labelled the present value motion inexperienced W-a/1, b/2, c/3 as a result of there’s all the time a risk of a W-4 and W-5- there can be no pink W-v to $1565+/-75.
