Elliot Wave Analysis for STI 7th April 2008

Hi, I was wondering if I could get Elliot Wave technicians to come here to discuss Elliot Wave counts for the STI corrective phase?

Well let's start with the view Ritesh Menon at OCBC as well as some other EWT technicians have about the STI:

View number ONE : Wave A in 5 impulses but flat or Diagonal Wave B and C?


In this pattern we are now in the wave a of Wave B. 5 wave impulse pattern on Wave A is clear. The view seems to be thought that Wave C will not be as steep as Wave A. From what I have read though, if Wave A is a 5 wave impulse then it is likely to be a Zig Zag steep decline where Wave B is short and small and Wave C is a powerful extended steep decline in 5 waves.

That would mean it will look more like this :

View number TWO :Zig Zag 5-3-5 Corrective Phase


The STI would most likely drop below 2000 in that case!!!!

The last view I can think of is that we are in a 3-3-5 Flat corrective wave :

View number THREE :Flat 3-3-5 corrective wave


This would be an in between view I suppose. In Flat patterns the Wave B can even go as high as the beginning of Wave A. This would be more positive for investors.

So which pattern would you choose? And why?

I think the key thing right now is to look at the fundamentals and correlate.

Is the USA going to have a very severe recession? If so then I think view number TWO would be the correct one.

Or has the Fed's actions and government stimulus package done enough to stave off a severe recession? Then perhaps views ONE and THREE would be correct.

Lastly, is Asia' growth strong enough to prop up the global economy? If so then view number THREE would be the case and we have indeed reached a bottom (although we will test it again).

From a fundamental point of view it seems that View Number ONE might be the right one. However I am not too comfortable with the Elliot Wave counts for View number ONE.