The objective of every investor is to buy as early as possible at the beginning of every new, major up move. Establishing a target for Wave 5, then, is the most important aspect of Elliot’s Wave Principle. I have presented you with a chart of Google (Nasdaq:GOOG) Let me state at the outset that there are some major objections to the way I have labelled the chart. Instead of a 5-wave pattern, one could actually label this as a zig-zag correction. But either way, the 5-wave pattern from the top of 602 is in its final leg (or possibly already finished at 280). Once we agree on that, we have a frame of reference. After every 5-wave move, a correction has to take place, and because the 5th wave of the move from 602 has been an extension, we should see a move back to 452 in the coming weeks. Please make a note of the level somewhere, and the date and level when I am making this call. The pre-market level for Google today 17th Nov 2008 is 306. If this analysis is correct, we should be looking for a 47% move up in Google over the next few months. Since we are looking for a move of $146, we need to decide how much we can risk losing on any position. This is a personal decision for each investor. However, as a starting point, we should be willing to see a retest of 280 and potentially a move down to 267. Buying below 290 would be a low risk trade, in my opinion. However, how much to buy will depend on your own risk appetite. Let me know if you have any questions. Your best way to reach me will be via the comments. Good trading!
Is Google in Wave 5?
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