Hello fellow traders. In this technical blog we’re going to take a quick look at the Elliott Wave charts of XLI , published in members area of the website. As our members know, we’ve been calling rally in XLI within the cycle from the 65.61 low. We got pull back that unfolded as Elliott Wave Zig Zag pattern ABC. In the further text we are going to explain the Elliott Wave Pattern and the Forecast.
Before we take a look at the real market example, let’s explain Elliott Wave Zigzag pattern.
Elliott Wave Zigzag is the most popular corrective pattern in Elliott Wave theory . It’s made of 3 swings which have 5-3-5 inner structure. Inner swings are labeled as A,B,C where A =5 waves, B=3 waves and C=5 waves. That means A and C can be either impulsive waves or diagonals. (Leading Diagonal in case of wave A or Ending in case of wave C) . Waves A and C must meet all conditions of being 5 wave structure, such as: having RSI divergency between wave subdivisions, ideal Fibonacci extensions and ideal retracements.
XLI 1 Hour Elliott Wave Analysis 7.31.2020
Current view suggests wave (2) blue pull back is unfolding as Elliott Wave Zig Zag. Correction still looks incomplete at the moment. We expect to see 5 waves down in C red leg as well. As of right now we’re looking for more downside in short term toward equal legs area at 71.20-70.15 (buyers zone). As our members know, Blue Boxes are no enemy areas , giving us 85% chance to get a bounce. We don’t recommend selling it in proposed extension down and expect to see further rally from the blue box or 3 waves bounce at least .
XLI 1 Hour Elliott Wave Analysis 8.2.2020
XLI gave us decline toward blue box area. It found buyers at 71.20-70.15, the Blue Box area. We got nice rally from there, when wave (2) pull back completed at 70.57 low. As far as the price stays above 70.57 , we expect XLI to keep trading higher as proposed on the charts. We don’t recommend selling it, and expect further rally from the blue box.
XLI 1 Hour Elliott Wave Analysis 8.9.2020
XLI held above 70.57 during short term pull back and we got further rally toward new highs. Consequently XLI remains bullish against the 70.57 low and should ideally keep finding buyers in 3,7,11 swings.
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