The market detective is a Chartered Market Technician (CMT). He uses technical analysis to identify market turning points and opportunities. He is primarily an Elliottician, he uses the Elliott wave principle and Fibonacci ratio analysis to uncover clues about the direction of the market. He uses other forms of technical analysis to corroborate his findings in such a way as to assign a probability factor to them.
11/2/20083:26 PM Pacific We could see higher prices. From a traditional technical analysis position, the 200 period moving average often acts like a magnet when price enters its orbit. Additionally a breakout from a triangle usually travels the distance of the widest part of the triangle. This distance is shown by the blue line segment. The Fibonacci ratios that support this are the tendency for motive waves 1,3,5, to travel in total a Fibonacci ratio of the first wave, most commonly 2.618 or 1.618, and the 5 th wave is most often a 382 or .618 extension of waves 1-3. Therefore, we have a double Fibonacci confluence corroborated by the 200 period ma and a common extension measurement for triangles. The supports that need to hold for this to occur are the top of the triangle preferably, then the 20 period ma / base of the triangle. If price falls through the base of the triangle, probability shifts to five waves completed. A tick below 94000 absolutely confirms near- term lower prices.
Transcript
11/2/20083:26 PM Pacific
We could see higher prices. From a traditional technical analysis position, the 200 period moving average often acts like a magnet when price enters its orbit. Additionally a breakout from a triangle usually travels the distance of the widest part of the triangle. This distance is shown by the blue line segment. The Fibonacci ratios that support this are the tendency for motive waves 1,3,5, to travel in total a Fibonacci ratio of the first wave, most commonly 2.618 or 1.618, and the 5th wave is most often a 382 or .618 extension of waves 1-3. Therefore, we have a double Fibonacci confluence corroborated by the 200 period ma and a common extension measurement for triangles. The supports that need to hold for this to occur are the top of the triangle preferably, then the 20 period ma / base of the triangle. If price falls through the base of the triangle, probability shifts to five waves completed. A tick below 94000 absolutely confirms near-term lower prices.
11/2/20083:26 PM Pacific
Looking at the 60min chart the 20period ma and a .618 retracement corroborate a strong support level for a bounce. I also show with a red horizontal line where an extension higher without a larger retracement is no longer possible. The larger retracement (lower prices) would probably be .500 (90425) or .618 (88554) if price is to then work higher.
TMD/DW The market detective provides personal market opinion based on sound technical analysis and research. However, no warranty is given or implied as to its true reliability. The market detective will make errors and mistakes. The market detective is not an investment adviser and is not making recommendations to buy, sell, or place orders relating to the futures contracts, ETFs, or stocks that he writes about. The responsibility for decisions made from information contained in this service are solely that of the individual subscriber. The individual must fully research and make his/her own decisions before acting on any information provided by the market detective. The market detective assumes no responsibility for subscriber investment or trading results.
