Important Disclaimer: The information provided in this blog is designed to provide helpful information on the subjects discussed and entertainment purposes. This blog is not meant to be used, nor should it be used, to buy or sell something and is absolute not an investment advice. The publisher and author of the blog are not responsible for any damages or negative consequences from any action.
The Dutch index “AEX” has seen an increase in price, which started around March 2009. On the weekly chart it shows this waves where a lot of traders talk about “The Elliott Waves”. The chart is showing a “basic 5-wave” (Elliott Wave Theory). This consists of 3 waves up (1,3 and 5) and 2 waves down (2 and 4).
There are a lot of rules and different patterns. I would like to pay attention to a small part of it and more of them in the near future.
The most important rules for the “basic 5-wave” are:
- Wave 3 can’t be the shortest impulse wave;
- Wave 2 can’t go beyond the start of Wave 1;
- Wave 4 can’t retrace in the same price area as Wave 1.
Other things I like to take with the analyse of today are:
- Wave 2 and 4 frequently bounces off a Fibonacci retracement level. For wave 2 it is often 61,8% retracement and for wave 4 a 38,2% of the waves 1 to full 3 or 50% of only the full 3 wave up.
- Wave 3 frequently find resistance at an Fibonacci Extension level.
- Wave 5 can end in three different ways.
- One is inverse 123.6 – 161.8% retracement of wave 4.
- Second, wave 5 is equal to wave 1.
- Third, wave 5 is 61.8% of wave 1-3
The source I read a lot about all this is: https://elliottwave-forecast.com/elliott-wave-theory/. You can type Elliott wave or Fibonacci retracement and extension into any search engine and you will find a lot of text about it. I do not say that everything you'll find is good information.
In the view of the above text, I would like to show the graph of the “AEX” (above). Here we see the weekly chart of the Dutch index "AEX":
- From about 195 points to about 573 points the course makes 5 big waves.
- The big waves that go up are also nicely divided into 5 waves.
- You can clearly see how this chart complies with all the above rules.
- the retracement and extension levels of fibonacci are also respected.
- Wave 5 is equal to 61.8% of wave 1-3.
Now the price in the “AEX” significantly corrects is it plausible that there is set a top, this is supported with the fact that there is divergence occurred in the last wave 5, which also happened just before the turn in March 2009. As I look at this whole picture, I find it plausible that there could be coming a bigger correction, but that’s me. Now the index already corrected a bit and I missed the first change. I remind myself that there will always be a new chance. For now, it’s waiting for a new chance, for example, a bear flag.
The last picture a want to show you is this big monthly chart with a huge divergence. I am not saying it will play out, but it is certainly present.
Congratulations @valuate! You received a personal award!
You can view your badges on your Steem Board and compare to others on the Steem Ranking
Do not miss the last post from @steemitboard:
Vote for @Steemitboard as a witness to get one more award and increased upvotes!
Congratulations @valuate! You received a personal award!
Click here to view your Board