Short Term Trading Member Forum

[techcharter]

I'm not sure about your starting point for LEH waves.

Are you considering the drop from the $80 are to be a correction in a much larger bullish wave?

http://stockcharts.com/def/servlet/SC.web?c=LEH,uu[m,a]daclyyay[dc][pb50!b200][vc60][iUb14!La12,26,9...

The March '04 highs to May '04 lows look like a 5 wave decline. For that to be corrective, it would need to be part of a larger correction since a single 5 wave is not a correction.

I would consider as a low probability the price rising above $80 if the multiweek wave 2 has not finished.

The long term elliott wave chart (10 year) shows a multimonth wave 4 triangle that started in early 2001 and ended in late 2002. Triangles typically occur in wave 4 positions in stocks.
From there a pretty convincing multimonth wave 5 (ending diagonal) developed that ended in early 2004. So the larger wave count implies a multiyear downtrend at least to the $40 range is due.

I checked for the decade long wave 5 as a possible ending diagonal. Technically it is not since the 1998 high (end of multimonth wave 1) was $42.06, and the 2002 lows (multimonth wave 4) was $42.47. It does mean the wave structure is weak.

http://bigcharts.marketwatch.com/intchart/frames/frames.asp?symb=leh&time=&freq=