Price went just a little bit higher, but the idea of a top remains in place. I have changed the labels to show where i think this rally fits into the bigger picture, the top probably was wave A of Y, which puts us in wave B of Y now. The decline started in 3 waves which means the rest will also be a corrective wave. The alternative is that this decline is a wave Y on a larger degree, i will go more into this over the weekend.
Hi Jeremy,
ReplyDeleteEWI is calling this as wave II tope and start of wave III down, with expanded flat complete. Do you think it's possible? Also as your analysis, if USD continues to go down, the inflation will kill the economy. Your thoughts?
Hello,
ReplyDeleteI have my doubts about this wave III EWI is calling for, i suspect they conclude this is a wave III because of what they see in other markets. I don't know about what counts they have there, but i personally don't see anything huge happening just yet. For eurusd the decline from the 1.4305 high (nov '10) seems anything but impulsive, which to me says the corrective rally, that started at 1.1875, is not finished yet and we need to go above 1.4157 (or 1.4208 depending on how you count the first part) first. Also, don't forget EWI is a buisiness and calling for a major reversal happening now sells more then major reversal coming in a few months, i guess...
As for the inflation that will kill the economy, honestly i wouldn't know as i don't know much about fundamental analysis. All i know is that the whole system seems very corrupt. Creating huge amounts of money out of thin air to keep a broken system alive is just asking for trouble. Those huge amounts of money have to cause inflation i believe, but it could also overload the system. I see prices are starting to rise allready and if this keeps happening or even picks up in speed, buisinesses will go bankrupt, consumers will stop consuming and the economy will fall on it's ass. But again, i am not an expert on that field, these are just my 2 cent.
Friendly greetings,
Jeremy