Tuesday, April 15, 2014

Facebook - Elliott Wave count

Facebook display a complete Elliott Wave structure in 5 waves up from the last major bottom in September 2012. The Elliott Wave count is marked with blue color on the weekly chart under.

Weekly chart of Facebook with technical analysis and Elliott Wave count. Source Elliott Wave Technician

The rally lasted more than one and a half year so the correction in progress should last at least a few more months if it is going to be in proportion to the rise.

On the technical indicators both RSI and #b displayed clear negative divergence at the recent top of wave "5" compared to the previous top of wave "3". The divergence is marked on the chart with a red line connecting the two tops. It is typical of a 5th wave to end with lower momentum then wave "3" .

A common initial retracement is were wave "4"  bottomed or around USD 45.

A more interesting question is if this complete a one larger degree Elliott Wave structure as well. If so then the initial retracement is USD 18 - 20 were the larger degree 4th wave bottomed. If you want to know if we believe this is the case, subscribe to our investment newsletter.

Geir Solem

Elliott Wave Technician
Copyright (C) all rights reserved

Thursday, April 3, 2014

The Stock Market of Russia - Collapse is Imminent

The Russian Bear is back and will soon show his anger in full force. A large wave
"(2)" rally topped early 2011, since then the Russian stockmarket has displayed a number of  "1" and  "2" waves of different degrees of trend.

Weekly chart of the Russian Trading System Index with technical analysis and Elliott Wave count. Source Elliott Wave Technician

Currently a small rally up to the horizontal resistance line marked in red color on the chart is topping.

The next should be a devasting decline in wave  "3" of  "3", most likely with large price gaps as the stock market of Russia collapse.

The implication of increasing negative social mood will be terrible, expect a more agresive and assertive Russian government, the current conflicts will escalate, chaos, destruction and further economic deterioration will follow.

The economic deterioration will soon hit the core European countries like France and Germany with full force.

Geir Solem

Elliott Wave Technician
Copyright (C) all rights reserved

Monday, March 24, 2014

Energy and Natural Resources at Historical Low Valuations

Price to book ratio of MSCI World Energy / MSCI World give a relative valuation of the energy and natural resources market.

Source Barclays, U.S. Global Investors

We are approaching 1999 / 2000 relative price levels, but remember that the ratio can still decline further before it turns up.

Geir Solem

Elliott Wave Technician
Copyright (C) all rights reserved

Wednesday, March 12, 2014

Copper Collapse in Progress

Copper often leads other markets. That's why the red metal is called Dr. Copper. See our previous forecast for Copper on this blog posted 21st of Februarry 2014 and 8th of October 2013.

Copper is following our forecast to a tee. Here is an updated weekly chart of copper with the Elliott Wave structure:

Source Elliott Wave Technician

There is no change in our earlier forecast published previously on this blog and repeated under

Copper is in the early stages of a decline in wave "C" marked on the above chart in blue color. Wave "1" of "C" down marked in black color is complete. A corrective rally in wave "2" of "C", also in black color, is complete. Wave "3" down in copper is in progress. Notice that the Bolling Band is expanding and the copper price is tagging the band confirming the down trend.

A possible target of coppers decline is the USD 2 - 2.25 area. Good support comes in at around USD 2.15 at the rising support line connecting the 2002 and 2009 bottoms (not visible on the above chart). This support line will be around USD 2.25 at the end of 2014 and around 2.35 at the end of 2016, but expect a "throw over" of the support.area to make our downside target come true. However, the hight of the "B" wave triangle indicate a target of around USD 2.5.

How the above fits into the larger Elliott Wave structure of copper is excluded in the above chart.

Geir Solem

Elliott Wave Technician
Copyright (C) all rights reserved

Monday, March 3, 2014

The Elliott Wave Structure of the Nikkei Index

Update on the long term Elliott Wave count on the Nikkei Index. The Nikkei Index just hit a mulit decade declining resistance line, and as we expected the Index failed to penetrate.

Monthly long term chart of the Japanese Nikkei Index. Click in the above chart for larger picture.

We think the bear market in the Japanese stock market will resume after a relief rally that is already underway and recommend to short this rally the Nikkei Index. You can use the long term declining resistance line for risk management.

Nikkei 225, more commonly called the Nikkei, the Nikkei index or the Nikkei Stock Average, is a stock market index for the Tokyo Stock Exchange.

The above is an extract from our monthly Elliott Wave Technician Investment Newsletter published 28th of February 2014. You can subscribe to our newsletter at web site elliottwavetechnician.com

Geir Solem

Elliott Wave Technician
Copyright (C) all rights reserved