chart...wolfepattern

I've been waiting patiently for the "5th-Wave" of a classic "Wolfe Topping Pattern" to complete in ANZ and whilst it is early days we just might have seen that at yesterday's high. The problem(or even the norm) with this pattern is that Point 5 can often overshoot the trendline extension from pt.1 to pt.3 and therefore I can't be too sure that yesterday was the "perfect" pt.5 location. As I said, its early days, but I'll be looking for an opportunity to short from now on just in case!

Regardless of whether that is the case the other characteristics of the pattern(I'll let you do the google search) are pretty much spot on(hint ... wave relationships T&P, wave overlaps and symmetry of retracements and extensions). However, what 'excites' me about any Wolfe Pattern is its unique benefit and the 'reliablity' of the "Price Projection Line"{PPL}(thats the extension of the trendline btwx pt.1 and pt.4 shown in blue on my chart)to provide us with a price 'target' going forward. Now, sometimes the time the pattern took from pt.1 to pt.4 projected forward can also be used to 'predict' the ETA of price action catching-up with the PPL once pt.5 has been confirmed(a close or two below $24.00 in ANZ's case). Hence, I see a possible time and price projection coming just B4 Christmas @ ~ $18.00....Whow, big call, right! I have also read somewhere that once the PPL has been reached that almost inclusively that 1st touch represents a min. of 75% of the wave down from a pt.5 location. Not entirely convinced this is so but even if it's close to the mark why wouldn't you trade such a set-up(with the appropriate stops, of course). No-one gaining near-on 75% of a swingleg would be complaining, right!.

For me, atm, only a small short position yesterday that I will add too if we break below $24.00(or the W%R uptrendline)or on a "false" breakout above the pt.1 to pt.3 extension in the near future.