All Appearances of Strength Defy Not Growing Weakness ~ The Risk Averse Alert

Wednesday, December 23, 2009

All Appearances of Strength Defy Not Growing Weakness

Might as well look at trend leader NASDAQ, eh? Ever so slightly higher she goes...

All appearances of strength notwithstanding, technical deterioration coinciding with fourth waves relative to second waves has occurred every step of the way higher off March bottom. This presents an objective condition confirming the view that, five waves are unfolding off March bottom.

These five waves are seen forming wave C of an A-B-C Elliott corrective wave developing since November 2008 bottom. Indeed, that "all appearances of strength" exist at all at this point (following last year's throttling) is more fitting a C wave (an Elliott third wave) than were any first wave contrarily thought forming off March bottom. Resilience seen in both the ongoing advance's longevity as well as its coinciding RSI and MACD remaining decidedly to the buy-side of respective ranges objectively quantifies such "appearances of strength" as lend weight to this probability.

Now, Elliott corrective wave iv of 5 [of C of (B)] could in fact extend out to last Thursday's low (12.17.09) instead of ending where labeled above. Thus, wave v of 5 (finally leading to top) could extend $COMPQ a bit higher still (yet in the process remain shorter than wave iii of 5 ... as it must were the wave count above correct).

Judging by RSI and MACD the end of NASDAQ's advance off March bottom draws near ... much as has been the case for quite some time now. Yes, no doubt, this levitation has extended a bit longer than I thought likely. Yet this is neither of any great consequence — fearsome, position-wise, or analytically perplexing — nor is this levitation's duration any great surprise — indeed it is far more fitting than it is the least bit astonishing.

Could I have better expected it?

What's the difference when there is objective confirmation that, in the end these past few months spent in extended levitation won't matter one bit? (Indeed, I thought much the same back in early July when extension of this advance off March bottom appeared a reasonable possibility.)

Could I have better profited, particularly considering the distance traveled, indeed, was, remarkably, something I anticipated?

Uh, yeah.

Do I regret this?

You want to know the truth? It's too early to tell (but I doubt I will)...

Fast Money
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