The Chart du Jour
In the chart above, we show the Dow Jones on a daily basis since its significant high back on May 22, 2001 at 11,345.70.
For people who like a beautiful Elliott wave pattern, our first decline after that high ended in a July 11, 2001 low at 10,120.90, and was a textbook 5-wave affair. We have labelled this as a Wave 1 down. This was followed by a choppy retracement period that we have more tentatively labelled as a Wave 2. September's collapse was then a typical and violent Wave 3 decline. Everything past September 21, 2001 continues to appear best labeled as a sharp and large A-B-C Wave 4.
Now Elliott practioners worth their salt also know that a Wave 1 and a Wave 4 should never overlap. So this now gives us another level, 10,120.90 on the Dow, to lean against in re-establishing short biased positions. As long as our current rally fails below 10,120.90, then another decline (perhaps a failed fifth wave down, or perhaps a decline that reaches our previously espoused 7725 downside target) should transpire.
Wave 5 downmoves often travel a distance equal to 61.8% of the distance travelled by Wave 1's start to Wave 3's end. Wave 1-3 taken as a whole was a decline of 3,283.40 Dow points, so .618% of that distance would equal 2029.14 points. Subtracted from Tuesday's Dow high at 9976.70, this yields a target of 7947.56 -- or marginal new lows just far enough below our September 21 low to scare the hell out of people once again, and just a 220 points shy of our Fibonacci target that could be reached on an intra-day overshoot. This rough downside target will of course adjust up a bit if the Dow can still meander to marginal new highs in the short term.
Overall, it appears to us that the markets may enter Thanksgiving feeling happy, but come out of it with new fears starting to fill the horizon. We'll allow for a bit more work in this market, and maybe even marginal new highs (1061 still being possible in the very short term basis the S&P 500), but as long as 10,120.90 on the Dow is not intersected, the next large move for both these markets should soon be to the downside.
Above 10,120.90, we will turn agnostic once again and go back to scratching our proverbial head as to how to appropriately label this market.
How Your Articles Are Delivered
Upon the processing of your credit card or the receipt of a personal check, Sand Spring will e-mail you the articles requested as a Word attachment, and also provide you with a WWW address and password to view the article on the web without using Word should you so desire. Confirmation of your order will be immediate, and the actual article will follow by e-mail typically within a few hours and in all cases before the opening of NYSE trading on the following day.
Ordering by Credit Card:
Our shopping cart is designed for both physical and subscription products, so do not be confused too much when it asks you for a shipping address. A correct address is important only for credit card authorization purposes. Your e-mail information is the most important piece of information to us for proper delivery of your article(s).
Sand Spring Advisors provides information and analysis from sources and using methods it believes reliable, but cannot accept responsibility for any trading losses that may be incurred as a result of our analysis. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities, and should always trade at a position size level well within their financial condition. Principals of Sand Spring Advisors may carry positions in securities or futures discussed, but as a matter of policy will always so disclose this if it is the case, and will specifically not trade in any described security or futures for a period 5 business days prior to or subsequent to a commentary being released on a given security or futures.
If you order by credit card, your credit card will be billed as "Sand Spring Advisors LLC"
Take me back to the Sand Spring Home Page
Comments or Problems
Thank you for visiting Sand Spring Advisors LLC, Inc. We hope to hear from you again soon. For more information on Sand Spring Advisors actual programs, services, or to request a copy of a Disclosure Document, please phone us at 973 829 1962, FAX your request to 973 829 1962, or e-mail us at information@Sandspring.com
| Corporate Office: 10 Jenks Road, Morristown, NJ 07960 Phone: 973 829 1962 Facsimile: 973 829 1962 |
Best Experienced with
The material located on this website is also the copyrighted work of Sand Spring Advisors LLC. No party may copy, distribute or prepare derivative works based on this material in any manner without the expressed permission of Sand Spring Advisors LLC
This page and all contents are Copyright © 2000 by Sand Spring Advisors, LLC, Morristown, NJ
