Risk/Reversals IMM/Flow of Funds NOTE : The RSI NEVER got back below the magic over sold level at 20!! Mutations extending corrections Outside of critical Elliott Wave levels I am very wary of using absolute specific support and resistance levels. I watch Fibonacci cluster zones, channels, previous congestion zones and then provide slippage room around those levels A couple of walk-throughs An example of what happens when youre lazy USDINR 1month fwd ELECTION RESULT AS EXPECTED, ALL GOOD NEWS PRICED IN Sugar reversal + triangle targeting 21-24. Food inflation POSSIBLE EL NINO BELOW AVG RAINS = SHORT FALL IN SUGAR Sugar contd IGNORED POSITIONING !! What about USDINR? A Case study The AUDUSD AUDUSD Monthly into July 2011 1.1025 = 61.8% Fib of the entire decline from the 1974 highs around 1.4850 A i B Iii ii C V iv Copper topped weeks before, as had Iron Ore Copper Vs AUDUSD Correlation Baltic Dry Freight remained soft

AUDNZD Major reversal from key highs What was the USD doing in general? How to trade it off the top 3month Vol was back to range lows Managing the short term swings C v C A Stopped out ii Re-entered A i iii i Iv i ii B B iii iv v A 5th wave projection method I am mindful of The next phase Markets are always changing.. Markets are always the same The world has changed and has always been changing. One of the things I write about in my books is, no matter what you think is true today, its not going to be the case in 15 years. You pick any time in history, 1900, 1915 and look at what everybody thought was the way the world is. Fifteen years later enormous changes had taken place all over the world in society, in politics, in wars, economics, everything. Jim Rogers

An analogy of Elliott Wave: You can learn the right notes to play a piece of music on the piano, but only a few can play it well enough for people to pay to hear. There is a rhythm and a harmony a proportion and balance in the movement of the markets and some people are just wave deaf, or can at least be wave handicapped.