NASDAQ 100 Amazing Price Pattern!

NASDAQ 100 - Downside Targets achieved @ 6507.84!

Last week’s escalating news-flow around President Trump’s plans to expand upon existing U.S. import tariffs caught the markets out, with declines of -9.5% per cent in the Nasdaq 100 over the last 10-day period. Whilst the media and analysts continue to debate the impact of a potential trade war, the Nasdaq 100 together with the other major U.S. indices is quietly unfolding into some near-perfect Elliott Wave patterns that eliminates all the ‘guessing’ and ‘opinion’ from investors and pundits alike.

Secret Key - The Elliott Wave Expanding Flat Pattern

January’s decline hasn’t finished yet, it’s identified as unfolding into an Elliott Wave expanding flat pattern – see tutorial graphic, top-right – fig #1.  There are quite a few twists and turns in this pattern particularly in the second sequence which means a lot more price volatility over the coming month.

The expanding flat is composed of three main price-swings, labelled in minuette degree as waves [a]-b]-[c] and subdividing 3-3-5 or otherwise termed as zig zag-zig zag-impulse. Wave [a] establishes the initial price-extremity of the pattern which it did by declining from January’s high of 7022.97 into a zig zag, ending in mid-February at 6164.43. Waves [b] and [c] must then marginally break beyond wave [a]’s trading-range in order to complete the expanding flat. The amplitudes of waves [b] and [c] can be measured using fib-price-ratios.

The second sequence of the expanding flat, wave [b] is unfolding higher from the mid-February low of 6164.43 as a zig zag pattern, labelled (a)-(b)-(c). Wave (b) was recently forecast as unfolding into an expanding flat pattern, labelled [A]-[B]-[C] with downside targets towards 6498.00+/-. Last week’s dramatic sell-off basis the Trump tariff news pulled prices directly into this downside area ending into Friday’s session low at 6507.84 – less than ten points from objectives – Monday’s (today’s) opening has rejected this low, trading now at 6657.21. This ends wave (b) of February’s zig zag upswing – wave (c) is now en-route towards 7381.64+/-. See fig #2 - WaveTrack's Track Record forecast published ahead of the move 15th March 2018. 

Trade Negotiations or Trade War?

US Treasury Secretary Steve Mnuchin said yesterday this about China - ‘We’re having very productive conversations with them. I'm cautiously hopeful we reach an agreement’. China’s Ministry of Foreign Affairs replied by saying ‘China is willing to negotiate to appropriately manage and control differences with the United States on the basis of mutual respect and mutual benefit’.

Conclusion

Basis the expanding flat, a short-term reprieve around tariff talks has softened last week’s sell-off, hence today’s stock market pull away from last Friday’s lows. But if the expanding flat has another sharp decline coming once current prices trade to higher-highs, then for sure, we can expect the talks to break down – unless another exogenous event takes its place!

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