Setting Up A Wipe Out ~ The Risk Averse Alert

Thursday, October 10, 2013

Setting Up A Wipe Out

Some recovery. In fact, 2% gains across-the-board set up a wipe out that, finds good reason to suspect imminent.

Via the NYSE Bullish Percent Index we find another technical measure indicating the NYSE Composite's 4th wave of 5 waves up from early-June 2012 has yet completed. Upcoming we can expect the above measure to fall below its mid-November 2012 low when the 2nd wave of 5 waves up from June 2012, itself, completed. This would serve to confirm the NYSE Composite's Elliott wave count and, of course, set up the 5th and final wave higher off June 2012 bottom, completing wave (c), as well as the NYSE Composite's advance off its March 2009 bottom.

The market's turn back down should be imminent. Whether 5 waves down from September's Psych!s peak are in the midst of unfolding, or just 3 waves down (i.e. a-b-c), a 3rd wave down is due to unfold next. Today's screamer higher in fact is a favorable setup, as displayed was typical price volatility in the immediate neighborhood of this anticipated 3rd wave lower whose price volatility should prove even greater.

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© The Risk Averse Alert — Advocating a patient, disciplined approach to stock market investing. Overriding objective is limiting financial risk. Minimizing investment capital loss is a priority.

Analysis centers on the stock market's path of least resistance. Long-term, this drives a simple strategy for safely investing a 401(k) for maximum profit. Intermediate-term, investing with stock index tracking-ETFs (both their long and short varieties) is advanced. Short-term, stock index options occasionally offer extraordinary profit opportunities when the stock market is moving along its projected path.

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