FLATS are three legged structures also labeled as a-b-c. Three legged structures as opposed to five legged structures more sideways. This is why three legged structures are called counter trend, corrections or retracement of the main trend. And five legged structures on the other hand are impulsive, non overlapping and cause net movement. A classic example is illustrated here (SLIDE 1).
What we see if a five legged structure from the OCT bottom and now a three legged a-b-c sideways, overlapping structure down. This means that the trend is up and counter trend or correction is down. FLATS are also more sideways than ZIG ZAG’s which are more sharp and deep.
The current market scenario that we are witnessing on the local markets is full of FLATS. This includes BETFI, BETXT, SIF2 and SIF5. Flat identification is easy. In a normal FLAT the C wave does not push below the low of A. Now SIF2 (SLIDE 1) is witnessing a potential FLAT, where the C low has not reached the low of A at 0.55. Till the time prices don’t break the A low this sideways structure remains valid.
Just to understand price structures we use complimentary tools like OSCILLATORS. And many of them are suggesting overreactivity and are moving disproportionately to the prices (SLIDE 7,8). This also validates our view that the ongoing down move is a potential corrective.
We could be wrong, but then the SIF2 C wave low has to break down below 0.55 for us to look at markets differently. The latest update on WAVES.ROM also carries a primary count on SNP. TGN, TEL and BRD also remain above KEY LEVELS.
We remain positive on the market, till KEY LEVELS break against us.Enjoy the latest WAVES.ROM
ORPHEUS ROMANIA RESEARCH
WAVES.ROM is a perspective product published on TUESDAY’S and THURSDAY’S. The report highlights Romanian Stock Market top three Equity Indices viz. the top ten blue chip BET Index (.BETI), BET Composite (.BETC), the Financial Index BETFI (.BETFI) and the local currency RON (EURRON=, RON=). The products covers the top ten BET component stocks. (ROMP.BX, SNPP.BX, BATR.BX, BRDX.BX, TSEL.BX, ATBE.BX, BRKU.BX, BIOF.BX, IMPT.BX, TUBU.BX) and all the components of BETFI Financial Index(SIF2.BX, SIF5.BX, SIF3.BX, SIF1.BX, SIF4.BX) are covered in the report. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers. WAVES.ROM, CHANNELS.BVB and CHANNELS.RASDAQ are bundled together as PERSPECTIVE products. Unlike WAVES which focuses more on blue chips, CHANNELS covers all the BVB and RASDAQ stocks.
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