ScripsAmerica Inc. (SCRCQ)

[The Claw]

On July, 12 2013 we reached a pivotal point on the technical side of the chart, one of the strongest of the Elliot waves is wave tree which had occurred last week, now we are in wave 4, see below. Wave 4 is sometimes frustrating and where most people lose money on a long term investment because of the erratic and volatile behavior. All these waves are based on the psychology and the mindset of the trading which is why you seem some sell or some flippers in the stock because of the spread differentials. For those that hold in wave 5 are the ones who always reap the rewards because the last wave is always a greater continuance of the trend and in this case our trend us moving up. I posted a little information about wave 5 and 4 along with a chart and how they are determined below



Wave 4: Wave four is typically clearly corrective. Prices may meander sideways for an extended period, and wave four typically retraces less than 38.2% of wave three (see Fibonacci relationships below). Volume is well below than that of wave three. This is a good place to buy a pull back if you understand the potential ahead for wave 5. Still, fourth waves are often frustrating because of their lack of progress in the larger trend.

Wave 5: Wave five is the final leg in the direction of the dominant trend. The news is almost universally positive and everyone is bullish. Unfortunately, this is when many average investors finally buy in, right before the top. Volume is often lower in wave five than in wave three, and many momentum indicators start to show divergences (prices reach a new high but the indicators do not reach a new peak). At the end of a major bull market, bears may very well be ridiculed (recall how forecasts for a top in the stock market during 2000 were received).

Pattern recognition and fractals

Elliott's market model relies heavily on looking at price charts. Practitioners study developing trends to distinguish the waves and wave structures, and discern what prices may do next; thus the application of the wave principle is a form of pattern recognition.

The structures Elliott described also meet the common definition of a fractal (self-similar patterns appearing at every degree of trend). Elliott wave practitioners say that just as naturally-occurring fractals often expand and grow more complex over time, the model shows that collective human psychology develops in natural patterns, via buying and selling decisions reflected in market prices: "It's as though we are somehow programmed by mathematics. Seashell, galaxy, snowflake or human: we're all bound by the same order."[4]