Nifty EOD 27-9-2011== The First Impression

Yesterday'I wrote:

Q

The count as it stands now is:

sw1=5168-4830=338

sw2=4830-4930=100(29.5%)

sw3=4930 downwards --target 1.62*sw1=1.62*338=550=4380 in 5 waves

(i)=4930-4759=171

(ii)=4759-4868* having retraced 64% of (i) so far

Now the question is, what are the probabilities for this sw3(ii):

the chances of sw3(ii) going further up are there, but it can not go above 4930 as per this count.

All shorts, therefore, must have a SL at 4931

UnQ

Clearly this count has become invalid as (ii) cannot retrace more than 100% of (i).

And we have now to look for an alternative count. And for that lets go one degree higher----

C (on a higher degree) in play from 5944 down as a 5 wave form,having played out:

w1=5944-5329=615

w2=5329-5740 as an expanded flat;

w3=5740-4720=1020

w4=4720-5168

w5=5168 downwards started on 22-9-2011 and most likely cover(=w1) 615 points.

And this w5 which was to cover 615 points in 5 waves has already covered 409 points(5168-4759) and we are yet struggling to find valid fractals for it.

Lets take various probabilities one by one( not necessarily in order of preference):

Probability 1: w4 did not end at 5168

If so then A of w4=4720-5168(448) a 3 wave form

B=5168-4759=409 having fractals

sw1=5168-4830=338

sw2=4830-4930=100

sw3=4930-4759=171(50%) neither qualifies as a 5 wave(to consider it as B(a) nor as 3 wave

so this probability is ruled out.

Probability 2 : W5 is over at 4759

As 5168-4759=409 is more than 0.618*w1(=380) so this probability also comes in play---w5 ending above w3.

Least probable because w3(=1020) was only 166% of w1(=615) and w5 truncations occur mostly when w3 is hugely extended over w1.

Probability 3:

w5 in play and its sw1 instead of ending at 4830 has gone upto 4759 thus making

sw1=5168-4759=409 and currently sw2 to the up in progress.

For a wave at whose starting the tentative target was a length of 615, it is very difficult to digest that its sw1=409 as that gives a tentative length of 1000+ to the full wave.

Probability 4: w3 did not end at 4720 and the move from 4720-5168 and 5168 - 4759 be seen as continuation of w3.

I request my fellow EW enthusiasts to contribute to these probabilities---

Raghu