INDU went to highs of 12391, overextending to last week highs, our wave count really didn’t expect this to reach 5 mini waves in this current rally, also, we are up 30% since the July 2010 bottom, history says that no market can go higher than this in one straight line, needs to take a rest for a few months, the more the rally, the greater the correction is, estimate correction for my analysis (with the help of A. Caldaro-owner of this Graph).
1. We are in the Primary Wave 3, Major 1, Minor 5 – expected correction is 10% at least, with at least 1 month time.
2. We are in the Primary Wave 3, major 1, minor 3 – expected correction is 4-6 %, then at least 2 weeks time, then rally again for the minor wave 5 to end the Major 1.
I’m already upset that this uptrend continue to overextend to highs with an average of 78 RSI for the past few weeks (3x it hit 78 RSI and had 1% 1-day correction only), too strong for the market, really needs a good correction, let us see in the coming days and weeks if we will shift the trend to temporary correction.
PSE still hitting new weekly lows, coming back to the lows of 37xx led by TEL and GLO and other blue chips, Banks getting weekly lows also with RCB leading the breakdown hitting as low as 24.95, this bank really is the cheapest value now with 3.5p/E ratio, but not a favourite bank stock for traders. PSE still short term and medium term downtrend, but 200MA already crossed this week, might be a support, but might be not also, I have drawn a special uptrend line in parallel to our uptrend resistance, estimate support that SHOULD maintain the market to remain uptrend is 3600. I’ll just wait for another weeks until DOW gets the correction, until I blast PSE stocks. DOW please have the expected correction NOW! – don’t want to wait anymore... gets boring.
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