DJI updates181112

DJI 181112

DJI on the daily had dropped quite a bit and had stopped nicely at the 2.618 level (of 13000-13300 wave C-2). And this level at 12490 was held and a strong rebound was seen on Friday. With that, one should expect the rebound to kick in and a rally to about 12880 or 12979 (0.5 and 0.618 of 13300 to 12460 wave down). But on a closer examination of the internals of wave using 4 hr chart. One can see two wave counts which i proposed as shown below, in blue and red.

The light blue wave count had a completed five wave count ,but the problem is that Wave 3 is the shortest!And that is a violation of the EW principles. Thus, it should be discarded. The one is red showed that the wave 3 is formed and a wave 4 will be in progress. In this case wave 4 should never exceed 12730 for it to be valid.

Looking at this, i have a conclusion. DJI will have a rally to 12680 -12730 and a wave 5 down will continue to complete the C-3 which is shown on the daily chart. This Wave 5 might end at the same point of 12490 which we call it a truncation or exceed the 2.618 level.