Friday, November 19, 2010

11/19/10 - The Golden Section [EDIT 11/20]

[EDIT 11/20]
10 Min - W-X-Y


I was wondering if Elliott/EWI worked this out with correctives. Here's a chart with the corrective count of the same structure below. This would apply towards Options 1 and 1c.

Note in addition to the Golden Section concept, I have placed the green fibs on the chart. Fibonacci at work again here.

The green Fibs represent the length of wave (w). I have placed it at the start of wave (y) to determine how to project for (y) if it takes on a Fib ratio to (w). Notice that equality to (w) matches the top of the golden section. Hmm....


The Golden Section [Earlier Post]

I find Fibonacci mathematics very interesting and so did Elliott as it relates to the waves. Here is something from EWI regarding a simple impulse wave and the golden section.

According to EWI, "wave 4 often divides the price range of an impulse wave into the Golden Section. In such cases, the latter portion is .382 of the total distance when wave 5 is not extended and .618 when it is."


Golden Section - No extensions


Golden Section - Wave 5 Extended

Now take the above concept and apply it to the actual markets. I present the potential impulse wave which began on 11/16.

10 Min - No Extensions

Using the Fibonacci tool, if I set the .382 section right where I believe wave 4 has ended, we see that 1199 should represent the end of wave v. Hmm, that looks pretty good not to mention that the look of the wave appears to be a clean looking five wave structure. The only thing lacking there is a alternation, but then again that is only a guideline.

10 min - Wave 5 Extension

Apply this concept again but set the .618 ratio at wave 4 and we can project where wave 5 may land should it extend.

Will be curious to see what comes from this.
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