H&S 8-14

Once again I revisit this topic. I still have a feeling this formation is under the radar. It's good I don't have many followers so it remains a secret ;).

A couple things:

1. H&S:

I just can't ignore this formation. Granted the form may be developing at an angle and appear asymmetrical (right shoulder higher than the left) it helps to see it clearly with the trend lines (purple) drawn in. Notice how the trend lines are parallel. To me, that looks fairly balanced.

If you recall in my previous post (http://waveprinciple.blogspot.com/2009/08/head-and-shoulders-revisited.html), I projected that the next wave would be a wave B (I'm starting to think was minuette wave ii may count better) that "may turn out to be complex or a triangle of some form to make the shoulder broad."

So far so good. It certainly has not disappointed yet. The shoulder became very broad over 8/12-8/13.

So let's keep this formation on the radar. Of course we should also be aware that it could easily break down just like the previous one right before the start of the monster rally in July.

2. 5 Waves for (a) of Minor B [or Minuette i of Minute A of Minor B]:

I can count 5 waves down for (a) of Minor B. If this is legitimate, then I should expect another 5 waves down for (c) of Minor B.

Going into today's close, wave 1 complete and 2 should resolve itself next week.

3. Resistance at 1014

1014 marks the 38.2% retracement level from the decline that began in October 2007 to the March 2009 low. Price has attempted twice now to break above. The first occurring 1018, the second attempt with the right shoulder and possibly a third attempt come Monday, which may fall short.

I'm sure there is more but that is all I can think of for now.

Dan and OnChiOnly have very good counts that considers a triangle for Minor B in the works. Based on their counts, we are to go higher next week. Something to keep in mind.

http://danericselliottwaves.blogspot.com/2009/08/elliott-wave-update-14-august.html

http://onechionlyselliottwaves.blogspot.com/

If you are to follow my count, I would say the two levels to focus on would be:

1012.44 - Break above this and the count is invalid
992 - Break below and we continue counting waves down up to 5.

Have a great weekend!