Elliott Wave 5.0 "Reboot"

Monday, April 18, 2016

DJIA 2007-2016 Bull Market Review



I thought I would have another look at  the patterns I am working from the 2007 top.  The 2007 to 2009 pattern was a 3 wave crash as it also contained an ending triangle. It did not end with 5 waves. Anyone that is still calling this big crash a 5 wave impulse is forcing the wave count. 

I fully understand that most wave counters also call the market from the 2009 bottom to now as a big bear market correction which has only one path. That path must hit a new world market low well below 2009 levels.  I am sure this will not happen even though many Austrian economists and doom and gloom analyst are calling for it to do exactly that. Their favorite words are, "it's going to be much worse than 2009"!

 EWI is calling for massive deflation, but who knows what deflation or inflation actually is?  Printing money will not cause inflation as this printed money has to get out into the normal economy.  Imagine if you had a very good laser printer at home and printed crisp $100 bills 24/7 and stored them in your closet. Would this cause inflation? No, it would not cause inflation until that money came out of the closet, and circulated in the real economy.  

Besides, money is being destroyed on a regular basis as well, which we have witnessed in the oil crash so far. Massive amounts of gold stock value also went up in smoke since 2011. 

I think from the 2009 bottom has been far too long to be a bear market rally, but there still are many options in which way this can go, without hitting a new record high this time.   

If we crash down to new lows, but only cross the bottom trend line, then we could be at a 4th wave base and then another bullish phase would commence.  Triangles would create trusts that can boggle our minds. Our present rally is not very impressive at all,  compared to what a 5th wave thrust can do.  

I quit using any trend lines that are not parallel as all other types of trend lines show forced wave counts.