Below is a chart from earlier this week, discussing how much the pattern in 2011, looked almost like the pattern in 2007-08. (see post here)
Yesterdays decline did not break the 2008 support line, see below.
CLICK ON CHART TO ENLARGE
I am excellent with Elliott wave patterns…… looking backward/in the rear view mirror!!! 😉
Should support line (1) break, the decline should be large and I suspect that wave experts will say this is the kick-off to a “wave 3” move, which would be a rather large decline….support has to go first!
Confusing times (to me at least)! Does today’s pattern look similar to the pattern on August 11? With GLD and Treasuries up against resistance and stocks down at support? And the VIX high and people panicking?
What is different now? Shanghai breaking support? Did the 30-year Treasury break support (17-year-falling channel: “if line 1 breaks, big trouble”)? And the railroad wreck?
So I am guessing that you are not ‘selling at resistance and buying at support’ – not this time, too risky! Am I right?
Thanks again for the light and illumination. You are almost as good as Douglas Adams (“with the words ‘don’t panic’ in large friendly letters on the front cover”).
Look at a 20 year chart of S&P 500. You’ll see a head-and-shoulder (H&S) starting in 2000, creating the right shoulder. The head formed in the 2007-8 timeframe and we are just now completing the left shoulder. The head and left shoulder relate to your charting above.
I’m not sure a H&S pattern can be valid over 11 years. What do you think of H&S pattern in that timeframe?
Simply amazing! It looks like RUT closed right on the support line of ~651.
Once again nice call