TLS - Telstra Corporation

[rimtas]

tell me how you manage to get five waves into that chart.
View attachment 62912

Here you go, please (chart from my earlier post about TLS).










Actually I do not understand the anger and hate towards all ellioticians and the Wave Principle itself, especially from ones that are not even familiar with the method.
It is the great basis for analysis and I would recommend it to add it to everyone's arsenal of knowledge about markets.
I understand that Prechter made (and still makes to this day) a lot of laugh, but it has nothing to do with EW. He just has resources and a great public availability to do so and many people understand that EW is somehow directly related to DJIA crash to 100 or whatever.
But the truth is that this is one man's opinion, based on theories and hypothesies he delivered. Anyone saying that he is wrong is wrong too. And anyone saying that he right, is wrong as well. Because the end is seen only after the fact and the method used to forecast it doesn't matter actually.

So please, just forget Precter and discover the Wave Principle without him in mind.

 

[rimtas]

Or a Simpler Way of counting Waves-identify the steepest five way advance within the structure as a Third Wave, and what is left is Leading Diagonal as First Wave (consisting of five) and Expanding Ending Diagnal consisting also of five(two major corrections within are clear). Count as you like (or be blind as Porper), but the unfolding correction right now is the biggest correction, means second wave in progress.
It can end any time, but usually they end not when everyone put good fundamentals as the reason for further advance on the table. Good fundamentals are the consequence of the rising market and positive mood, which made TLS prosper-this is reflected in prices already.
During second waves, fundamentals start to deteriorate, because people's mood turns down.They refuse services, downgrade, or switch to cheaper low quality providers. This will be reflected in prices later.

Good fundamentals and a big confidence and complacency among commentators only confirms the fact that Intermediate First Wave has toped out. And I won't be surprised if TLS will crash right to the 2010 bottom of $2.55 in the years to come, but for many it would be a nasty surprise, that denies their logic.

 

[gartley]

You don't to be chopping, changing and wondering which wave count is in force. Agreed social mood and waves of optimism and pessimism go hand in hand to some degree, but how do you measure this??? The only measures of investor confidence are specialized sites that take surveys such as Investors intelligence and even the put/call ratio.

EWI uses such information to back their wave counts. But they have a problem, extreme pessimism or optimism can stay extreme for a very long time, years in fact. This is not an accurate basis for taking trades.

How high is too high, and how low is too low a price?
In the case of TLS I didn't trade it because I don't follow it. But from the attached weekly cycles chart it's not hard to see that price action reached an extreme ( ie upper 2nd and 3rd std deviation excursion from the pink nominal trend level) and upward trend was at risk of ending. As can be seen throughout the history of TLS when such level is reached, a pullback to the pink nominal line at a minimum starts or even to the lower 3rd std deviation. So when price reaches this extreme either up or down it only has a very small probability of maintaining such levels without at least a reversion to nominal levels first. Looks like TLS has further to fall.

 

[gartley]

Here you go, please (chart from my earlier post about TLS).

By the way Rimtas. I think you have done a great job of numbering this chart and this particular count I would have labelled the same as you but ofcourse it varies from practioner. I like to see the 1-2, 1-2, 1-2 followed be the point of recogntion 3rd wave. That's the way i was taught by EWI many years ago)))) I think every subdivison needs to accounted for to do this objectively.

 

[rimtas]

. Agreed social mood and waves of optimism and pessimism go hand in hand to some degree, but how do you measure this??? .

Sentiment is hard to measure. There are Surveys as you noticed and Daily Sentiment Index data(costing thousands $ from Trade futures.com), but apart from this you can just be a good observer and capture a good articles in the media, "shows" on the Business TV in a related manner, read forums what everyone is thinking and so on. Internet is a some sort of a mirror of Sentiment, which waxes and wanes along with the price of a stock or Index. Just have a feel of it and compare to the past.

As an example just last year in November I was in Telstra store to enquire about one product that I was interested in. And just out of curiosity I asked a consultant how business is going and is it a good time to Buy Telstra shares.
And he extoled that YES, now is the BEST time to BUY. That was an alarm bell for me, as when the average guy that doesn't know much about stock market makes such a recommendation, is a clear sign that the optimism towards the stock and the company reached deep into the non-professional layer of "investors", which is the sign of a mature trend.
Later I also saw on a Business News where one pensioner was exiting to have TLS shares and how he planned his bright retirement while seeing TLS rise 1-2 % each day. But the stock toped much later.

So the sentiment is not a precise timing tool. What it does tell you, though, is that the bulk of the advance from the $2,55 low back in 2010 is already in place. Wave counts agree with that, momentum signature agrees with that… This was the time when you should be expecting everyone to climb aboard the trend, and I was seeing strong signs of that, too.
There is a reason why extreme sentiment signals a turning point: First the trend gets popular, then it becomes too popular, then there is no one left to buy (or sell).
Put differently, you can have an extreme sentiment without an immediate reversal, but you almost never see a reversal without extreme sentiment.

But the markets are doing what they are supposed to be doing: inflicting the most pain on the most number of people. The majority always gets caught on the wrong side at big reversals. Always. For me, the news of the public piling into a trend is another snapshot of the market sentiment. That’s useful information. Markets fool the most number of people at the most unexpected moments, but by tracking sentiment -- and the news -- you can prepare yourself.

What separates Elliott wave fans from the rest of the public is that the public has no basis for determining when the trend may be over. In fact, the longer the trend continues, the more people join in -- and the more committed they become.

So again, Wave Principle is the key to understanding Sentiment Extremes.

 

[gartley]

There is a very good book written in the 1950's called "The Art Of Contrarian Thinking". It not only focuses on the financial markets but also politics and all sort of trends.

These sort of sentiment measures where around way before Prechter came onto the scene.

I agree about the opinion of the average man out on the street. Personally I never follow the financial media although I agree it can help you with your analysis.

For me all one needs is the price chart. If their buying prices are going up and if they are selling prices are going down

 

[Triathlete]

Would take a turn around in current financial suppression environment IMO. The TLS business is pretty stable ATM and price is more a result of the discount rate applied than anything else. It could be regarded as expensive on an absolute basis but not relative to other reasonably stable yields available.

On a relative basis to the XAO nothing in duration or depth out of the ordinary here.

View attachment 62914


ps
Waves are for surfing.

[video=vimeo;71959302]https://vimeo.com/71959302[/video]

Hey Craft...Like the video brought back memories of my own surfing safaris in my younger days......To now get back on this TLS thread I prefer making money from WAVES these days its better for my back pocket!!

 

[craft]

Hey Craft...Like the video brought back memories of my own surfing safaris in my younger days......To now get back on this TLS thread I prefer making money from WAVES these days its better for my back pocket!!

The mental challenge of the market is great but preferable to the adrenalin of taking off on something like shippys – I dunno about that.

Unfortunately this video tends to bring back more memories for me.



So how do you make money from waves in the market?

 

[Triathlete]

The mental challenge of the market is great but preferable to the adrenalin of taking off on something like shippys – I dunno about that.

Unfortunately this video tends to bring back more memories for me.



So how do you make money from waves in the market?

I use price analysis, time analysis and ELLIOT WAVES

 

[craft]

I use price analysis, time analysis and ELLIOT WAVES

So how do the three of them make you money?

 

[Triathlete]

So how do the three of them make you money?

Sent you a PM....Check your inbox.

 

[craft]

Sent you a PM....Check your inbox.

Thanks triathlete.

You probably should post the pm rather then just wasting it on me. – others may appreciate it.

In relation to the question of how does it make money – is it fair to summarise your post as answering high probability prediction of future price?

 

[Triathlete]

Thanks triathlete.

You probably should post the pm rather then just wasting it on me. – others may appreciate it.

In relation to the question of how does it make money – is it fair to summarise your post as answering high probability prediction of future price?

Yes that is how I would summarise it...

I like to work out where price is today and where it is likely to move in the future using the technicals although I really only trade stocks that also have strong fundamentals.

Working out what a stock is likely to do is your biggest benefit to being successful in the long run. My experience tells me that just picking stocks on fundamentals without using technicals to back it up does not give you the best returns.(in my case anyway)

I used to be only a fundamental investor, buy and hold, dollar cost averaging into stocks based on fundamentals etc,etc,etc but have found that adding the technicals also gives you much better returns overall if you really understand what to do with the technicals and what to look for to give you your edge.

I would also add that just because I may get a signal to buy I might not actually take a trade unless I see say 15% upside minimum that is why I make up my price charts to find the strongest areas of the stock to help me make that decision.

Any time I trade I will always have two views ...one on the upside (best case scenario) and one on the downside ( worst case scenario) or vica versa depending if we are trading long or short. Knowing this gives me the confidence in my trading so I am ready if things go against me ( not often though) I then know what I am going to do with my trade.

If you do not have an idea of which way your stock is going to move then really you are just gambling with your money. IMO

Cheers
Triathlete

 

[craft]

is it fair to summarise your post as answering high probability prediction of future price?

Yes that is how I would summarise it...

So the answer to Muschu's question would be that you know?

[Does anyone on ASF REALLY know where the market is heading?

My problem is I don't think anybody can predict the future. We are not dealing with laws of nature that can be extrapolated robustly into the future and historical correlation says nothing about future causation.

Having a story that gives you confidence to enter a position and something to monitor reality against as it unfolds is necessary - but if we can't know the future we better acknowledge the fact our story is fiction and any basis for predictive probability is tenuous. Rather then trying to make more accurate predictions with more and more complex analysis we should deal with the uncertainty accordingly. My stories are around value drivers for companies, because I 'believe' they have the most robust predictive foundation for the time frame I'm interested in - but I'm acutely aware that my bull**** stories around value drivers of a businesses future are fiction in the present. I can't perfect the prediction of the unknowable - but I can manage the uncertainty.

Obviously its each to their own in this game but I still reckon waves are best for surfing.

 

[rimtas]

Ok, let's leave those who think they can't predict future prices aside and look into the short term TLS waves (ripples).

Based on the current price movement from Wave 2 top( in May of $6,42) TLS has declined in three waves, so most likely it won't produce the big wave down yet. Pro surfers can pack their boars and get a coffee. But those who just started to learn surfing can switch to the smaller time frames-waves here are huge, just right for jump on jump off(the board).
There could be a good chance that a small Leading Diagonal can be at works, that will touch Impulsive Channel Lines multiple times before penetrating them, creating a wake up call for Pro Surfers that they were waiting for. Novice surfers will be washed out by the cunami wave that comes later, carrying prices towards $5.20.

Key level to watch on the horizon is $5.70-5.80-it can produce Point Of Recognition.
If the skies get clear, there could be no storm. But there appears that clouds are getting darker each day. Well probably depends on the wind. Don't forget your sunglasses, it's Australia.

 

[Muschu]

No disrespect..... But there is so much hindsight here and, looking forward, 2 bob each way in predicting and self-protecting those predictions....

Then there are the semantics of one form of TA versus another, or multiple others.

If anyone can predict and reduce risk then how much certainly, or uncertainty, is attached?

Surely if any of us were absolutely great at this then billionaire status would be a given result.

Mind you I am older and less interested in risk (less time for it I guess).. It's probably a good thing for younger people to take a relatively educated, controlled and modest punt (although the criteria around being " market educated" seem to be variously interpreted)...

But doesn't it remain a "punt" and about trying to reduce the odds?

If you are a higher risk player... Very different scenario.

As for TLS... I don't know where it may be in a month or so. Meantime, in my SMSF, it has been better than solid.

 

[rimtas]

No disrespect.....

Meantime, in my SMSF, it has been better than solid.

No disrespect...
But I found valuable only the sentence above. I shows a great confidence towards the future based on past prices.
5 years ago the words "solid in my SMSF" would have been like a joke.

And my post above was a response to the surfing topic, with a dose of water

 

[Triathlete]

My problem is I don't think anybody can predict the future.

Your right Craft....not with absolute certainly..

However on some stock charts and using technicals I have a pretty good idea of which way a stock is likely to move and therefore have the odds in my favour rather than the markets.I know we are getting off the thread!! but the example below...

Two charts in particular were the WOW, and CBA charts. Go back and take a look as to what was said months before it happened .

The technicals were showing that WOW was heading lower

I remember some ASF members were saying at the time the price was going to go back up in(wow) based on fundamentals and probably more hope than anything since they were probably holding the stock.

Yet the stock kept falling and still is today.
We might be getting closer to a bottom now...time will tell.

Look at the CBA chart I mentioned at $83 that it was looking at going to $100 and was marked on that chart at where to buy it months before it happened as well it got to $96 and we received a signal to get out at $94 which I did...so another profitable trade for me anyway....

Some may not believe in technicals but for me it helps to put the odds in my favour.

As to the market and I have only had a quick look on the monthly chart..It has been on a wave 3 and reached a minimum 100% so the current pullback is in line with EW.

The market could go anywhere from 25% to 61.8% retracement again nothing is certain but at least I have an idea as to what is likely to happen and am prepared for that scenario at present.

Once this completes than we should start to see the market move higher . If this was indeed a wave 3 then I would expect the 5th wave to rise between 162% and 262% over the next number of years how long that will take is unknown but on my chart presently that is what I expect.

Cheers
Triathlete

 

[Muschu]

No disrespect...
But I found valuable only the sentence above. I shows a great confidence towards the future based on past prices.
5 years ago the words "solid in my SMSF" would have been like a joke.

And my post above was a response to the surfing topic, with a dose of water

I was not referring to any single post made by any single poster.

I also do not doubt the sincerity of many analysts.

I do wonder, if analysts of any particular conviction are so skillled at what they do, how many of them are now people of exceptional wealth.

"Solid in my SMSF"? My portfolio has varied over the years and, at times over the past 8 years, has been totally cash.

 

[Muschu]

For interest I just checked.

I first bought TLS 4 years ago under $3. I have added since then and now have an average purchase price of $4.01.

Where will it go from here? I don't know.