Weekly Recap

Elliott wave analysis looks at the market as moving in a series back and forth motions called waves which can be numbered. The general pattern is a series of 5 waves which can be counted as 3 steps in one direction and 2 steps back. At the end of the 5th wave two possibilities are present: an ABC correction or a new wave count. An ABC correction is a pause, or consolidation, after which a new wave count in the same direction as the prior movement resumes. However, when a new wave count occurs after the 5th wave without the ABC correction then this can be in the opposite direction to the prior movement. I noted the beginning of the 5th wave in a prior post here.

The markets are at a resistance line that can be drawn from the beginning of the wave count to the downside connecting the top of the 2nd wave. This line can be projected down to the present. This is an area of resistance and also a decision point. It will take a breakout above this line on the weekly charts to develope the momentum for a new trend to the upside. Below are weekly charts of the Dow, Nasdaq, S&P500, Russell200, EFA (which reflects international markets), and GLD. Click on the chart to enlarge.

Dow

Dow chart above with Elliott waves drawn in black

Nasdaq

S&P500

Russell2000

EFA

GLD

I also am including these markets performance in table form along with the oil index.