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If you have ever stalked wild animals in Africa (hopefully to photograph, rather than shoot them), you will know it can take quite a bit of time to get the ‘shot’ you want. Sometimes you can stalk something for several days without luck but usually, if you know where to look and are well-prepared, you will see the action you expect and your patience will be rewarded.
The markets can be like this and BHP is a case in point.
The daily chart suggests that maybe a very short-term high is nigh:
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So, about $39 could see us there. The chart also implies that the possible wave five low we have been looking for could be off the agenda, but perhaps just in the short-term.
The Elliott weekly scenario is unfolding as we had expected:
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The Bollinger Bands suggests the market is only marginally out of the very short-term ‘oversold’ zone.
The wave four rebound is about half-way between the Bollinger Bands and it is possible we could see the market turn at this half-way point, although it is more likely there will be a convincing reversal after the price has moved outside the Bollinger – either the upper or lower band.
I am expecting a reversal before the upper band is reached and as we reach the midway zone we will then focus on volume and look for a day when BHP’s price moves higher but on low volume.
Stay patient as we continue to stalk the Big Australian.
Enjoy the ride
Tom Scollon
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