Let's just revisit the long term picture first. The triple resistance point near 140.00 still holds, but we will have to wait till the end of the month to see where the EUR/USD cross closes. The short term picture doesn't look to promising for a possible turn lower right now.
Then lets move to the hourly chart. This was not the picture I was expecting to see upon coming back from Rom. It's clearly a three wave decline from 141.56. So my first assumption will be that this was only part of a correction and that a new high will be seen after this correction is over.
I was looking into the possibility of this being a Leading Diagonal, but they come in 5-3-5-3-5 overlapping affairs and this one clearly don't. So the only possibility seems to be, that some kind of flat correction is ongoing. That would mean a B-wave closer to the top of wave A at 141.56, before wave C kicks in. Only a direct break below 138.55 would argue that wave B is already finished with the 140.50 test and wave C is under way.
"being a Leading Diagonal, but they come in 5-3-5-3-5"
ReplyDeleteHello,
thank you for your good analysis. Hope you had a outstanding vaccation in Rom. Have been there several times and will do it again. Very special.......
I would like to discuss the possibility of the Leading Diagonal. I have this count of a LD since several days as my main count on my blog. And I think, that there is a huge possibility, that it is really one. See my statements here: http://singulorum001.blogspot.com/2010/10/main-count-10212010night-30min-eurusd.html
You wrote, that LD usually come as 5-3-5-3-5.
Prechter in his book Elliott Wave Principle wrote on p. 40:
"It has recently come to light, that a leading diagonal occasionally appears in the wave 1 position of impulses and in the wave A position of Zigzags. In the few examples we have, the subdivisions appear to be the same: 3-3-3-3-3, although in two cases, the can be labeled 5-3-5-3-5, so the jury is out to strict definition......"
On larger timeframes I have rarely seen LD's at all.
On 1 and 5 min timeframes in EURUSD I have seen them several times, and in every case they were 3-3-3-3-3.
It is a pity that I didn't take a snapshot of them.
Have you often observed LD's on higher timeframes? If yes, were they in that cases really 5-3-5-3-5?
Have a nice weekend,
Infinitus
I believe it is tracing out a triangle with the spot you labeled B as A of the triangle
ReplyDeleteHello Infinitus,
ReplyDeleteThank you very much. The trip to Rom was fantastic. I love the place. Really a lot to see, both from the ancient Rom and the city itself. It won't be the last time I have been there.
I do think you are doing an outstanding job with your analysis.
Regarding the Leading Diagonal. First let me say, that I too have only seen LD in the lower time frames.
I don't agree with you on Prechter's view. Reading page 40 says:
"When diagonal triangles occur in the wave 5 or C position, they take the 3-3-3-3-3 shape that Elliott described. However, it has recently come to light that a variation on this pattern occasionally appears in the wave 1 position of impulses and in the wave A position of zigzags. The characteristic overlapping of wave 1 and wave 4 and the convergence of boundary lines into a wedge shape remain as in the ending diagonal triangle. However, the subdivisions are different, tracing out a 5-3-5-3-5 pattern. The structur of this formation fits the spirit of the wave principle in that the five-wave subdivisions of the actionary waves communicate a "continuation" message as opposed to the "termination" implication of the three-wave subdivisions in the actionary waves of the ending diagonal."
I do find it appropiate that there is a difference in the shap of an ending diagonal and an leading diagonal.
I would be very caution calling a 3-3-3-3-3 a leading diagonal, but I'am not able to say that it have never happended.
I would be very interrested in seen one in live action.
Have a nice day
EWS
Hi Waqar,
ReplyDeleteThe triangle count is clearly a possibility. I do think it's very early calling for the triangle, which is why I have choosen the flat count as my first choice, but if the C-wave also becomes a three-wave affair then the triangle count becomes the favorit count.
Have a nice day
EWS
Hello EWS,
ReplyDeletethank you very much for your extensive reply. It is very important but confusing what you are saying about page 40 of EWP. Maybe we have to check the edition. I have the actual 10th edition which is dated with 2005. It is the same edition Prechter has for his subscribers as eReader version online.
But anyway. I think we will see in a short time which pattern really will evolve. :-)
Have a great day,
Infinitus
Hi again Infinitus.
ReplyDeleteI have the sixth edition, which might explain the difference.
I don't have access to the tenth edition, but have done some surfing on the Internet and found the same text you refer to, so as you say we will have to wait and see which pattern will evolve.
By the way I migth have found and leading diagonal on a major time frame. I will make a post of it later this evening.
The very best regards
EWS