Wednesday, May 2, 2012

FTSE vs DAX connundrum

FTSE and DAX look similar but with important differences in terms of Elliott Wave labeling.

FTSE daily

Recent down move LOOKS like a wave 4, BUT according to EW rules wave 4's CANNOT violate Wave 1's price.  So an alternative may be that the move up concluded at 5990 mid March , and now we are either in a Wave 1  down, wave 2 in progress (bull move complete), Wave A down and wave B in progress; which means a wave 3 down (strong) or a Wave C down (also strong).

The DAX is similar BUT the recent downward move has not violated Wave 1 so current move up could be start of Wave 5 up; Is the move up convincing enough? 

So there are 3 scenarios.

1. Bull move from December complete, and now in down trend.
2. Bull move from December complete and now in correction ABC with C down wave to come
3. Correction from highs complete and NOW in a move to NEW HIGHS

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