Dow - Continues with its major wave 9

Dow (25,316)

Dow is forming the wave (iii) of its major wave 9 currently. Major wave 9 can have either five or nine waves.

FBMKLCI (1,778)

KLCI can continue to move higher to complete the wave (v) of its major wave 5. If major wave 5 has nine wave instead of five , KLCI may even continue to for its wave (iv), (vii), (viii) and (ix) before ending the major wave 5.

But, if KLCI instead of moving higher, it starts to move lower and lower and and break the low of its major wave 4, it can only mean that it has completed its major wave 5 as well as its mega wave (5), which is very very bearish. I personally consider this scenario as less likely since Dow is forming its bullish major wave 9 and Dr. Mahathir seemed to have things under control.

But if technically the bull run from September 1998's low of 262, the super wave I has ended, the minimum target for the super wave II correction is the end of mega wave (4) at 829 level. That will give a 56% pullback. This will happen if there is a major global stock disaster. Don't forget that the bear always started quietly with seemingly harmless drops.

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