Friday, March 27, 2009

The Chart of US's Stocks






Harmless Little Bear






There are many US stocks appeared to have started the major bear market rebound (major wave B) ahead of the Dow. I don't think Dow has finish its bear journey yet.

AIG's peak was set in October 2000 at US$103.75 (Dow was about 10,500). It dropped to about US$50 in February 2003 for its wave A (Dow = 8,000), rebounded to US$72 in May 2007 to form wave B (Dow = 13,500 and peaked 5 months later at 14,164). Its low two weeks ago at 33 cents is very likely its wave C. (I should have used 1-2-3 instead of A-B-C because the 33 cents location is actually the Major Wave A for AIG). From 33 cents it rebounded to US$2.00 for a 500% gain.

Since the 33 cents low, AIG has formed its sub-wave 1 and has started its sub-wave 2. It closed last Thurseday at US$1.10.

Citi Groups pattern is exactly same as AIG with its peak at US$77.75 and its low at 97 cents set two weeks ago to complete its higher degree Major A Wave. Similar to AIG it has started its Major B rebound ahead of Dow.

Citi has also completed its sub-wave 1 and is currently forming its sub-wave 2

BAC has its peak in November 2006, much later than AIG and Citi but the form is the same with its low at US$3.00 set two weeks ago.

Similarly BAC is currently in sub-wave 2.

Las Vegas sands has a chart that is more in line with Dow. Same as Dow it has its peak in October 2007 at US$ 145.57. It touched a low of US$ 1.38 two weeks ago for a 99% drop. In the process it has formed 7 sub-waves as shown. (7 wave in Elliott can be treated as equavalent to wave 1-2-3 with wave 3 having 5 sub-waves).

For Las Vegas Sands, currently it is either in wave 8 or it can be in sub-wave 1 if wave7 is the end of major wave A. Hopefully the next pull back can provide some indication and hopefully it can provide a good entry point.




The long term charts of Fannie Mae and Freddie Mac looked similar to all the above bank stocks, however their 6-months charts looked different. Both Freddie and Fannie have completed their sub-wave 1 and 2 and also sub-sub wave i and are currently in their respective sub-sub-wave ii of sub-wave 3. Please take note of the double bottoms formation. If this reading is correct, the next surge is going to be the dynamic and powerful sub-sub-wave iii of sub-wave 3. This iii of 3 most likely will break the neckline of the double bottoms with high volume. ( neckline is a line formed by joining point1 and point i of the above chart). I must pray very very hard for it to happen.

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