Firstly, redefined some wave counts of the correction since end January 2018 to ensure the correction pattern conforms to standard Elliott Wave correction pattern.
As a result of the redefined, the Elliott Wave Intermediate degree (Scenario 1 & 2.1) wave 4 correction is of 2 possible structures, an Expanded Flat (3-3-5) pattern OR a double-three pattern. This is due to the ongoing Minor Wave C yet to fully developed into a clear pattern which results in these 2 possibilities. Actually, the Expanded Flat case was first mentioned on STI Analysis -- the next peak and trough ? (XIII) dated 9th May 2018.
For the Expanded Flat pattern, the Minor Wave A itself consists of a sub-level double-three pattern (sub double-three - flat), A-B-C which lasted 3 months and that is why it stretches the current correction to 7 month old and still ongoing. Typical guideline of Expanded Flat pattern also fits very closely to correction. Wave B terminates beyond starting level of Wave A and Wave C ends substantially beyond ending level of Wave A. As a Fibonacci Ratio guideline of Expanded Flat, Wave C can be 161.8% of Wave AB and that will lead STI to 3151. Looking at the ending diagonal pattern of wave v for the 5-wave impulse, STI as of 31st Aug 2018 at 3213.48 is in wave-iii for the wave v. Wave-iii might not be completed yet and factoring in wave-iv and wave-v, STI will have no problem in breaking the recent low of 3176 and fall further to 3151.
For the Expanded Flat pattern, the Minor Wave A itself consists of a sub-level double-three pattern (sub double-three - flat), A-B-C which lasted 3 months and that is why it stretches the current correction to 7 month old and still ongoing. Typical guideline of Expanded Flat pattern also fits very closely to correction. Wave B terminates beyond starting level of Wave A and Wave C ends substantially beyond ending level of Wave A. As a Fibonacci Ratio guideline of Expanded Flat, Wave C can be 161.8% of Wave AB and that will lead STI to 3151. Looking at the ending diagonal pattern of wave v for the 5-wave impulse, STI as of 31st Aug 2018 at 3213.48 is in wave-iii for the wave v. Wave-iii might not be completed yet and factoring in wave-iv and wave-v, STI will have no problem in breaking the recent low of 3176 and fall further to 3151.
For the double-three pattern, marked in blue in the above chart, Wave A (a 5-wave impulse) and Wave B have been formed and ongoing is the Wave C (another 5-wave impulse) to complete the 5-3-5 zigzag pattern. Wave C 5-wave impulse is now in wave iii and doesn't look complete, thus wave iv and wave v will lead STI to beyond the recent low of 3176. A Fibonacci Ratio guide of zigzag is Wave C is 161.8% of Wave A and in this case will land STI to 2886. At this level, Elliott Wave count for Scenario 1 & 2.1 will be violated due to wave 4 overlap into wave 1 and this will lead to Scenario 3 (Intermediate wave 2 correction). Another Fibonacci Ratio guide for zigzag is Wave C is 161.8% of Wave B and this will lead STI to 3072.
Regardless it is Expanded Flat or double-three pattern for Intermediate Wave 4 correction, all is pointing to some more downside going forward but should be the final downside already. Due to the fact that Minor Wave B overshoot the starting level of Minor Wave A, it does look the correction is more biased toward the Expanded Flat pattern. Furthermore, from another TA perspective looking at Ichimoku and GMMA, there are early signs of the correction is going to bottom soon and that could reinforce the case of Expanded Flat as the double-three bottom still have quite an amount to fall. However, the early signs from Ichimoku and GMMA could be a false signs too therefore further monitor is required to confirm to avoid jumping into conclusion too early.
In STI Analysis -- the next peak and trough ? (XIII) dated 9th May 2018 it was mentioned the leading and lagging of the FTSE ST REIT Index and FTSE ST Financial Index with the FTSE ST REIT Index being a leading indicator for STI while FTSE ST Financial Index a lag behind it. Still remembered at that time came across comments that FTSE STI REIT Index entered bear territory, dead cross happened, not buying S-Reits due to more Fed rate hike, blah blah blah and all buying into banking stocks as it was still in uptrend with Fed rate hike only benefit banks. Then, Elliott Wave count already signaled FTSE ST REIT Index was in last wave count (Wave C) of the correction while FTSE ST Financial still at Wave 5 (doing the ending diagonal pattern) before correction kicked in. In fact I did an Elliott Wave Analysis on DBS on 14th Jun 2018 to warn of coming correction. Now 5 months later, from another TA perspective using Ichimoku and GMMA indicators, this proves to be true, the power of Elliott Wave.
Regardless it is Expanded Flat or double-three pattern for Intermediate Wave 4 correction, all is pointing to some more downside going forward but should be the final downside already. Due to the fact that Minor Wave B overshoot the starting level of Minor Wave A, it does look the correction is more biased toward the Expanded Flat pattern. Furthermore, from another TA perspective looking at Ichimoku and GMMA, there are early signs of the correction is going to bottom soon and that could reinforce the case of Expanded Flat as the double-three bottom still have quite an amount to fall. However, the early signs from Ichimoku and GMMA could be a false signs too therefore further monitor is required to confirm to avoid jumping into conclusion too early.
In STI Analysis -- the next peak and trough ? (XIII) dated 9th May 2018 it was mentioned the leading and lagging of the FTSE ST REIT Index and FTSE ST Financial Index with the FTSE ST REIT Index being a leading indicator for STI while FTSE ST Financial Index a lag behind it. Still remembered at that time came across comments that FTSE STI REIT Index entered bear territory, dead cross happened, not buying S-Reits due to more Fed rate hike, blah blah blah and all buying into banking stocks as it was still in uptrend with Fed rate hike only benefit banks. Then, Elliott Wave count already signaled FTSE ST REIT Index was in last wave count (Wave C) of the correction while FTSE ST Financial still at Wave 5 (doing the ending diagonal pattern) before correction kicked in. In fact I did an Elliott Wave Analysis on DBS on 14th Jun 2018 to warn of coming correction. Now 5 months later, from another TA perspective using Ichimoku and GMMA indicators, this proves to be true, the power of Elliott Wave.
From the above 2 charts, it is clearly shown that FTSE ST REIT Index displays all the bullish criteria which Ichimoku and GMMA define but FTSE ST Financial Index doesn't.
Taking an example of performance of DBS, the largest money lender in South-East Asia and CapitaMall Trust, the largest Reits in Singapore based on market cap. Note, DBS is NOT the strongest banking stock in Singapore whether from Elliott Wave count or other TA indicators and some claimed it is despite using TA to convince (really scratching head how TA shows that). CapitaMall Trust on the other hand is also not the Reits with the strongest trend at the moment. On 9th May 2018 (the day I posted the analysis), DBS and CapitaMall Trust closed at $28.76 and $2.09 respectively (w/o adjustment for dividend). On 31st Aug 2018, DBS and CapitaMall Trust closed at $24.95 and $2.14 respectively. Ignoring dividend being collected during those periods, DBS has fallen 13.25% while CapitaMall Trust has gained 2.39%. STI on the other hand has only lost 9.44% for that period (3548.54 vs 3213.48). Who is leading and who is lagging indicator of STI should be quite obvious. Strongest doesn't just measure how powerful it can thrust up but also how resilience it is during correction. However, not to worry for DBS (or banking stocks in general) as the full course of the uptrend is yet to complete (similar for S-Reits and STI) but before that, there will be more downside for DBS to come before the rebound.
Added 3rd Sep 2018
STI opened in the red falling to an intra-day low of 3193.86, a lower low than previous day. Despite a brief rebound to green but failed to hold on to the gain and eventually closed 3207.20. There is no sign that the current wave v-iii (expanded flat case) or the wave iii (double-three case) has yet to run its full length. A zigzag should form for the wave v-iii while the length so far is too short for wave iii. The bias for more downside going forward remain intact. However, looking at the buying momentum, should it be the expanded flat case, STI should see a rebound for form the uptick of the zigzag of wave v-iii.Added 4th Sep 2018
STI opened slightly lower but whole day trying hard to stay positive, eventually closed slightly higher at 3210.51. The uptick doesn't look finish for the zigzag pattern of wave v-iii. Thus should have a bit more upside before resume the down to complete wave v-iii. Should STI play out the ziagzag to form wave v-iii then the 2nd case of wave iii for the double-three pattern could be invalidated. On the other hand, the early signals from Ichimoku and GMMA indicators for a bottom forming still yet to invalidate and those early signals are slowing improving toward the bottoming.Added 5th Sep 2018
Finally, as expected the recent low of 3176 breaks down as STI closed 3156.28 with an intra-day low of 3151.83 (the 161.8% Fibonacci Ratio described above). This is the wave 3 (wave v-iii ending diagonal or the wave iii of the 2nd half of the zigzag) for sure. Going forward STI should see a rebound of sizeable amount for wave 4 (wave v-iv of ending diagonal or wave iv for 2nd half of zigzag) before the final down wave 5 (wave v-v of ending diagonal or wave v of 2nd half of zigzag). The key will be when wave 4 will take place as this will differentiate whether STI will be an Expanded Flat or Double-three correction. Should STI fall further to 3094 (161.8% Fibonacci Ratio for wave 3) or beyond before rebound then it will bias toward the Double-three rather than Expanded Flat correction. That is to say a zigzag and not a 5-wave impulse with ending diagonal will be formed. With 3151 (the 161.8% Fibonacci Ratio of Wave AB) hit and still not end of bottom, the followings are several possible bottom to look out for :- (a) around 3100, wave C same length as wave A (b) around 3050, the 261.8% Fibonacci Ratio for the 5-wave impulse (c) around 3030, the 200% Fibonacci Ratio of Wave AB.Added 6th Sep 2018
STI lacked the strength to rebound from yesterday sell down falling further to end at 3147.69 after hitting an intra-day low of 3139.99. STI should due for the wave 4 rebound (wave v-iv of ending diagonal or wave iv of 2nd half of zigzag). The rebound should end around 3190, the peak of the wave 1 and resume on the wave 5 down. At this moment still can't differentiate which case it will play out (ending diagonal or 2nd half of zigzag.
The above chart is for the case of the ending diagonal and potentially ending wave v-v at the lower boundary of the falling wedge (A-B-C-D-E) at around 3090 very similar to the situation whereby wave C is of the same length of wave A. However, should the wave 4 rebound is not coming within the next 1 to 2 days, STI will be biased toward the other case of 2nd half of zigzag (Double-three instead of Expanded Flat correction) as STI 3030 - 3050 is a high possibility. Regardless of which case, it is still early to bottom fish as the last wave 5 still yet to play out.
Added 7th Sep 2018
No rebound, no wave 4 (general for the case of wave v-iv of ending diagonal or wave iv of 2nd half of zigzag) for the day as STI continued the fall to an intra-day low of 3119.89 before closing at 3134.39. The close is slightly higher than the open value thus creating a doji candlestick in the process, a one with a fairly long leg and that could signal the end of wave 3 and a wave 4 rebound is next. Now still can't differentiate whether it is wave v-iii of ending diagonal or wave iii of 2nd half of zigzag, will have to wait for the full 5 wave to complete then can confirm. If in wave 5, there displays an ending diagonal then it will be the Double-three flat-zigzag pattern. On the other hand if no ending diagonal being played out then will bias toward the Expanded Flat case despite the wave C looks longer than theory. As a whole for the Scenario 1 & 2.1 in which the current correction is Intermediate wave 4, the drop is more than 50% and heading toward the 61.8% Fibonacci Retracement ratio at 3086. That is quite a deep correction for wave 4 by standard. Anything beyond 3086, that is the 61.8% Fibonacci Retracement ratio, Scenario 1 & 2.1 might be invalidated and STI is in Scenario 3, Intermediate wave 2 correction.Added 10th Sep 2018
Not a day for Wave 4 yet as STI went lower hitting an intra-day low 3105.36 before closing at 3120.92.
The intra-day low hit the Wave 3 projection line as well as the lower boundary of the falling wedge and rebound from there. For past 2 days in a row, STI ability to rebound from intra-day low is a sign of the inertia for a Wave 4 to come. Looking at current STI value and wave count, STI should be heading toward between 3030 to 3080 for the Wave 5.
Added 11th Sep 2018
Another failed attempt to rebound to form wave 4. STI ended at 3109.91 hitting an intra-day low of 3103.94. STI just sliding down along the wave 3 projection line. It could continue the slide to 3080, the supposed 161.8% guideline for wave 3. The longer it fails to form wave 4, the higher possibility that the pattern is not an ending diagonal but a norm impulse. This will have implication of the downside and also the overall correction pattern, the Double-three instead of the Expanded Flat.Added 12th Sep 2018
Finally, the rebound, wave 4 is formed after STI hitting an intra-day low of 3102.73 and closed at 3124.65. Wave 4 will determine the pattern is an ending diagonal should it rebound further to 3188 or above creating the overlapping of wave 1. If the pattern indeed is not an ending diagonal then wave 4 at most end at 3183 with probably between 3141 to 3164 being very highly possibility. After wave 4 is the final wave 5 and it will break today intra-day low of 3102.73.Added 13th Sep 2018
STI rose to an intra-day high of 3139.48, just slight below the 23.6% Fibonacci Retracement for wave 4 at 3140.
The closing at 3131.77 could either suggest a bit more upside for wave 4 to meet the 38.2% to 50% Fibonacci level of 3164 to 3183 or complete the wave 4. Suppose it has completed wave 4 the projection for wave 5 is shown in the chart above with a possible target of around 3067 (close to 3050 mentioned before), the 50% Fibonacci level for the Intermediate degree Wave 2 correction. The failing to overlap wave 4 if wave 4 already completed also mean the pattern is not an ending diagonal and STI could experience an sub-level degree of ending diagonal in wave 5.
