PLS chart, page-16271

Ok so a quick post mortem of the first part of the day:



Obviously my first wave count was correct, and the 3rd wave finished circa 501 with a 23% retrace into w4. W5 is always tricky and the low estimate is that it will be the same as wave 1, which gives us 503 as shown by the blue price range tool (measured from the bottom of wave 4). The high estimates when price is running strongly is variously 160% of wave 3 through 160% of wave 3 added to the base of wave 4 - at least that's how I do it. The last model is to treat wave 3 + 4 as a flag and add the pole length to the bottom of wave 4 taken from high to high and added to the point at which wave 5 breaks the down trend line. Obviously this gives several different estimates for wave 5. In this case the price range over wave 1 was the correct one. Wave 5 should be traded as a sell on the roll over of the MACD I find, or just take your chips off the table at wave 3.

Of course this works best when you don't change your mind about the wave count at the last minute! Wave 4 can be 14% (rarely) 23% (occasionally) 38% (normally) or 50% (sometimes) of wave 3. Thus when it goes below 50% you know you screwed up the count. Wave 3 should be at least 160% of wave 1.

Now we have completed wave 5 and are doing the correction. In a rising market - which I think PLS is today - the correction should stop around 50% to the top of wave 1 of the previous cycle OR at the bottom of the support channel where the support channel is below the top of wave 5. In this case the 5 waves rose within the support channel, so that is discarded. The likely stop is thus circa 492. We are sufficiently early in the day, that the entire sequence is likely to be super-wave 1 of a super wave sequence in which case the predicted retrace becomes super-wave 2 of a larger sequence and is 491.5 (78% of super-wave 1). If this proves to be the case, then the next super-wave should get to 160% of the first super-wave giving a day target, or at least a wave target, of 517. This super wave would be expected to have 5 parts to it as well. How far we get through those before the end of the day depends on when we start the next rise.