Third waves are "wonders to behold"
July 27, 2012
- What's the direction of the main trend?
- How far will it go?
In the 1930s, Ralph Nelson Elliott discovered that stock market prices trend and reverse in recognizable patterns...Elliott isolated five such patterns, or "waves," that recur in market price data.
Elliott Wave Principle: Key to Market Behavior (p. 19)
Third waves are wonders to behold. They are strong and broad, and the trend at this point is unmistakable...Third waves usually generate the greatest volume and price movement and are most often the extended wave in a series. It follows, of course, that the third wave of a third wave, and so on, will be the most volatile point of strength in any wave sequence.
Ever the optimist, he is holding to his market call this year for the S&P 500 to hit 1,500.
Shares continue their winning ways, technically. The averages show a stair-step series of higher highs and higher lows, the definition of an uptrend.
The stock market is nowhere near a lasting low.
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