The Wolfwave Pattern / Why walk with bulls - run with the wolves!

[therman]

Thank You Melf Elf,

I applaud,
yes that´s the way I look to the chart, and I saw that it is a triangle/wedge .

I took a look to the explanation of the wolve wave from calven.
In the examples I see that there are no normal trend channels with parallel trendlines,
because the channels are gettin more and more narrow to the end, with a small angle,
but you´re right they aren´t sloping so steeply.

Thank you once more for the explanation.

therman

[Melf Elf]

In the examples I see that there are no normal trend channels with parallel trendlines,
because the channels are gettin more and more narrow to the end, with a small angle,
but you´re right they aren´t sloping so steeply.

therman,

Yes, I see what you mean about the channels.  I've seen some Wolfe Wave examples that look much more like wedges, but "use what works," eh? 

Your QTWW very well could work out to have the effect of a Wolfe Wave, which would be to breakout above the wedge, then rally to $6-ish.   

We'll watch it. 

[thai626]

thai,

I wanted SVA at 4.34, if the Gartley completed yesterday, for a 10+% rally back to 4.82-4.85.  Didn't get it.  Yesterday's low only got to 4.60, so I didn't play it.

Hi Melf Elf,

Ya, I didn't get any either.  My target entry is just about 4.40-4.50.  If it doesn't hit in the next couple of days, the WW will lose its symmetry and the pattern will no longer be valid.  O well, there's always more fishes in the sea!  Good luck!

[robby631]

ciao ragazzi,sono daniele e abito in italia,amo le onde di wolfe,opero in particolare sui future sp500 e nasdaq100
time frame 60 minuto mininasdaq.

Ciao  Sono  Roberto.


Torna  a  casa  TARTUFON.      1-2-3-4-5.......tARGET..

[calven]

CMI is not a ww. I am 100 % sure.  Please refer to those original diagrams showing the exact patterns.

A bull WW is like a bull flag...its a small retracement therefore the trend has to be down
A bear WW is like a bear flag....the movement is up before a breakdown.

QTWW is a WW. Nice find ! (applaud)

[calven]

I got some new diagrams including the trend needed for each ww. My previous diagrams lacked this aspect. This should clear things up 100%!

The following diagrams are from www.chart.nu-

As you can see the patterns are in the wrong trend...something i have tried to tell you both but you didnt understand. These diagrams should clear it up...

A bull ww needs to be pointed downward....CMI doesnt fit this.... SVA is also not in an overall downtrend...it doesnt fit either

[calven]

THIS ONE WORKS! QTWW

[calven]

No wonder this was so confusing for you guys. I didnt include the previous trendline leading into the WW's for you guys. My mistake and apologies! I cant believe I didnt see this earlier!

I stated that the trends must agree with the pattern bull or bear  but its much easier to understand and see with diagrams that include it!

Sorry again folks. Now you should get it....

Here are the new diagrams - including the trend leading into the WW.

Cal

[calven]

QTWW..looks like a WW to me!  I think I might buy a small position 

If this WW becomes valid 6.00 would be a huge move from here. Remeber though, it could take 18 months for point 6 to be hit....furthermore, fundamentals still control the stock since this WW is for the long term.

cal

[Melf Elf]

A bull WW is like a bull flag...its a small retracement therefore the trend has to be down
A bear WW is like a bear flag....the movement is up before a breakdown.

QTWW is a WW. Nice find ! (applaud)

calven,

therman and I weren't sure about that.  Thanks for clarifying it.  Thanks also for clarifying the lead-in to the Wolfe Wave.  Applause.

Since QTWW is Falling Wedge, but it qualifies as a Wolfe Wave, maybe we should say:

A bull WW is like a bull flag or a Falling Wedge.
A bear WW is like a bear flag or a Rising Wedge.

I was looking only for WWs that had a parallel, or near parallel channel, which ruled out alot of stuff.  What do you think?

I'm watching the Wolfe Wave in the S&P 500.  Not sure if the pop above the top of the Bear Flag on Thursday was enough to complete it, or if we have another push higher for Wave 5.
Short-term, basis the 10-minute chart, it looks like a H&S top if we take out SPX 1268.

[Melf Elf]

The 10-Minute chart of the SPX appears to be a fractal of the Bear Flag in the daily chart in the last post.  A "fractal" means a repeating pattern...it is "mirroring" the behavior seen in the daily chart (a Bear Flag).

This chart is from late afternoon yesterday, and doesn't include all of the trading into the close, but the close was 1270.94, which is right near the bottom of the Bear Flag.

[agatto2]

Thanks for clearing that up cal...    This makes it much clearer to me at least. Melf ,, that changes the dynamics of the trade. Would you please outline the people/emotional aspect of the trade with the new lead in? Ill give you a applaude     

                                                                                  Awsome job on this guys tonyg

[Melf Elf]

Melf ,, that changes the dynamics of the trade. Would you please outline the people/emotional aspect of the trade with the new lead in?

tony,

The lead-in was one of the things that I understood from the beginning, from calven's explanation, charts that he posted, and charts at the site that The Scotsman gave us, (though I was confused on a lot of other stuff), so my take on the emotional/psychological aspect of the Wolfe Wave trade is the same.

At the October low in the QQQQ and NASDAQ Composite, for example, we had an imbalance at Wave #5, when they broke their channels to the downside.  Theoretically, players sold their long positions at the channel break, and even shorted that break.  So, the proverbial "everyone" was on the wrong side of the trade, thus the parabolic-type rally from there to the present. 

Players had to buy back their long positions, and shorts had to buy to cover their positions.  "Everyone" had to buy, especially on the November 3 breakaway gap to the upside out of the top of the Wolfe Wave pattern.

Following that logic, (using the SPX chart below as an example) the proverbial "everyone" is now long the SPX and/or has covered their short postions as we ratchet our way higher in this current Wolfe Wave.  As we have continued to make higher highs and higher lows in this "Bear Flag" Wolfe Wave, more buyers have come in and more shorts have been forced to cover, but the technical indicators are getting weaker and weaker, not confirming the move higher.

The daily MACD in the SPX, for example, now is below the signal line, and on Friday, it turned down from an attempt to get back above the signal line.  Wave 5 could already be in for the SPX, given the action in the 10-minute chart which I'll show you in the next post, but if we bust through the top of the Wolfe Wave pattern in the daily chart (below), MACD almost assuredly won't confirm the move to new highs.

BTW, now that we know that Wolfe Waves also can be Bearish Rising Wedges, and that they don't have to be parallel channels, I'm now thinking that your EQR chart is a valid Wolfe Wave.  I'll post that  chart after the post on the SPX 10-minute chart.

[Melf Elf]

Basis the 10-Minute chart, we had a Symmetrical Triangle break to the downside in the final hour of Friday's trading, and also had a failed re-test of the pattern breakdown at the 3:30PM bar.

[Melf Elf]

tony,

Sorry that this chart is difficult to read.  The pattern in blue is the Bullish Falling Wedge; the pattern in Black is your Bearish Wolfe Wave.

Given that EQR gapped down below your pattern on Thursday, that suggests that the upside target of 43.40 from the Bullish Falling Wedge breakout on October 24 isn't going to get made.

If the gap at 40.60-40.67 from Wednesday gets filled, I might short it.  Notice, though, that the bottom of the broken Rising Wedge/Wolfe Wave pattern was resistance on Friday.