Disliked{quote} By the way do you perhaps have some rought numbers of how many markets/instruments in terms of % correct when bull/bear ratio gets under 10% extreme? Would be interesting to get that info to get better grasp on it. Eventually ofcourse every market corrects, but what matters is once numbers hit extreme under 10%, it shouldnt take long to correct from there otherwise its a thing to count as fail of correction.Ignored
Hi Jan,
the sentiment extremes should work in every market. The herding behaviour is hard coded in our genes, sadly.......
I think it is very promising, when one can wait for the situations, where the sentiment is really extreme:
below 15, above 85
I do love especially the situations, where one can get in with values below 10 or above 90.
I had several chances to get positions, when sentiment was below 10% bulls. Sometimes I had a bit of drawdown, but not much.
But I have also experienced weeks and weeks, where I did not found a single instrument in such extreme positions. Lately we have such conditions very often.
BUT:
Be careful with sentiment data - from time to time it sucks. Like here
https://www.google.com/imgres?imgurl...A9wQMwgdKAAwAA
Look at the picture and in a chart to see what happened after EWI wrote/published that stuff.
Here is a Link to DSI on Gold over the course of 18 months or so:
http://www.elliottwave.com/freeupdat...n-Extreme.aspx
I have similar picture of EURUSD vs DSI. http://ic.pics.livejournal.com/ruh66...31945_1000.jpg
On the EURUSD vs DSI picture, which ranges from 20014 to Nov 2015 one can see, that the DSI was in fairly bearish territory since around 1,25. But the counterralleys were mostly weak over a long time.
There were counterrallyes when DSI was extreme bearish, but they did not last long.
Maybe you can remember, that I neutralized my short positions between 1,31 and 1,25 because of the bearish sentiment (mainly) and volume analysis. Retracements were only shallow and so it was hard for me to re-establish the short positions.
Prechter once wrote, that in a wave 3 the optimism/pessimisms can stay at extremes for a longer time. At the point of recognition (usually the 3rd of a 3rd wave) the retail crowd gets it suddenly right
Prechter unfortunately labelled this move as a wave 5. My main count has this move as a wave 3.
I wrote many pages about this move and laid down the case, that it most likely is a wave 3 because of mood and the astonishing perfect fib ratios on multiple degrees.
I have some more charts on my hard drive. If you like to have them for visual inspection, email me your email address