Hamilton's E-Wave Analysis

EWJ Japan ETF

EWJ March 10

This is from March 10, 2009. We liked the chart as it had completed , or nearly completed a very nice 5 wave move down. You have to pick your spots! The low was just under $7 and from there it did what almost all indices did, universally. Here is todays’ chart.

What is interesting is that the counter-trend retracement of the past two years retraced precisely 62% ((14.5-7)x0.618 +7)= 11.5 ).Also interesting is that all three legs A, B, and C are equal. This is the same retracement structure we have seen for at least two dozen different stocks. To add to this curious symmetry, the low was established on the of March 2009, and the high point on the 28th of Feb. 2011, about a week shy of two years.

The EWJ deviates substantially from the Nikkei so one does not necessarily substitute well for the other. But curiously enough, the EWJ is trading  exactly like CCO, both requiring another 4-5, 4-5 to complete the initial move.