Wednesday, December 29, 2010

XAO Elliott Wave Alternative counts

As implied in the last post, the lack of clarity in the short term wave counts and the Christmas holiday period has been working against the primary short term XAO Elliott Wave count.

In the chart below there are two counts that I would consider of equal weighting at this stage until some break out of the trend lines occurs. It should be noted that there is divergence on the RSI (oversold)  and the MACD price oscillator on the daily charts since mid December, implying a correction should soon be at hand (or something else to support the 2nd Alternate count). Using volume is a little hard atm as there tends to be a reduction in volume over the holiday period.

Alternate count 1 supports more upside with wave 'B' circle yet to complete. The push higher needs to be in corrective waves and should exceed wave (A). The (A)-(B)-(C) correction is a flat with a B wave failure.

Alternate count 2 supports the downside but wave '2' must not break above wave 'B' circle. My only concern is that wave '2' is taking a very long time to complete v's the initial down leg - although perfectly legal, there may be something else unfolding - hence the alternative counts in this post.

As you can see, there interpretation of the initial leg down from this high can be read as a 3 or a 5 wave move depending on how you count the wave structure.

Monday, December 13, 2010

The Downtrend ready for a run?

On the bearish count, I'm a little cautious around Christmas as the holiday mood is usually positive for stocks and the short term wave count hasn't been clear and a break above the 76.8% retracement of wave (i) down has occurred (although perfectly legal).

The anticipated  A-B-C (circle) correction currently underway (or finished), doesn't have clarity as the C wave needs 5 waves up. However, on the very short term, one can count an ending diagonal pattern which is evident in wave 5's and wave C's of flat corrections.

Under this count wave (ii) should have finished today (or one more small push upwards is needed) and the down trend should resume. Breaking above the Wave '2' high at 4885 will invalidate the count on the short and possibly medium term outlook.

Thursday, December 2, 2010

XAO Very Short Term update

Five waves down from the top of Wave '2' appears complete and a wave (ii) correction has been unfolding and should be near complete - the downtrend should resume in the next couple of days.

However, the 5 wave decline isn't a smooth one and there are other interpretations that should be considered that lead to further upside potential.

For the bearish count as shown: Wave (ii) has just pushed over a 50% retrace and is in a good position to complete with the MACD price oscillator on the 15min chart (not shown) being divergent. Pushing past 76.8% retrace @ 4828 would be a key indicator to watch for and imply an alternative could be unfolding.

Note: I'm also missing some data due to an ASX upgrade - the missing data is in the 'A' circle leg of the wave (ii) correction. I haven't looked closely at the impact to any wave counts as yet.

Thursday, November 18, 2010

XAO Short term Update

Looking for confirmation of a 5 wave decline

The very short term XAO has completed a 3 wave decline and as described in the last post, a decline to around 4690 would most likely occur. The XAO hit 4695, before climbing up to 4726 today. The expectation is for more declines to complete wave '3' circle which doesn't appear complete. The MACD price oscillator (not shown) has plenty of room to move on the downside and no divergence is evident as yet.

Should the decline not occur, then channel lines (as shown) are needed to define the upside area that the XAO can be allows to operate within. As discussed in previous posts, breaking the upside channel line will bring into doubt the count as well as potential stops that could be used to reduce risk.

Wednesday, November 17, 2010

Australian Financial Sector - Long Term update

The Australian Financial Sector index - XFJ, has not declined in smooth waves of 5 from the all time high like the XAO. Instead, the XFJ has declined in waves of 3 and the decline has been difficult to predict due to a lack of 5 wave moves. However, if we were to use the same assumption as the long term XAO - a zig-zag correction down to the 100yr trend line, then we can assume (for the moment) that the XFJ will zig-zag lower but with a triangle for Wave 'B' circle.

Thus, the rules for a triangle need to be observed until proven wrong as shown below with expected paths for waves 'd' and 'e' labeled:

Tuesday, November 16, 2010

Short Term XAO update

The Australian All Ordinaries index appears to have completed a small flat correction for wave '2' circle as described in the last post and going against the decline in the US markets for the first 4hrs of trade.

The declines near the end of trade today are expected to continue down to around the 4690 level where wave '3' circle should terminate.

Friday, November 12, 2010

Ending Diagonal Complete - What Next?

The All Ordinaries is bouncing off channel support, but it appears a small 5 wave decline has been completed in order to get there. There is potential for one upwards push in the next couple of trading days to complete a flat correction for wave '2' circle (as shown) before further declines are expected to develop.

It should be noted from this post that a possible wave '2' top (from 2 high potentials) was expected at 4874 based on Fibonacci relationships of prior waves, the XAO pushed above this level by only 10 points before commencing the decline - showing Fibonacci provides some very useful "suggestions" for turns.

I also need to update my chart that shows the moon cycles compared with EW counts on the XAO - a post for later.


Tuesday, November 9, 2010

The case for Wave 2 completion

The XAO has declined after slightly exceeding the 76.8% retracement level and after completing an ending diagonal wave.

Discussed in the last post there was a distinct possibility that there would be a throw over of the 1-3 trend line in the ending diagonal on higher volume before declining.This has occurred, and signals an end of the current trend (at least in the short term).

The decline now needs to commence in 5 waves down thru the channel support lines (not shown) in order for a convincing start to wave '3'.

Tuesday, November 2, 2010

The pending RBA Interest Rate decision

It's that time again. Last month the RBA kept interest rates on "hold" even though there was a case to raise them based on the cash rate lagging the 90 day bill rate by almost 0.5%. Today, the 90 day bill rate hasn't much moved since the last RBA meeting and hence there is no case to adjust the Cash Rate Target.

As you can see in the chart below, there have been extended periods of time where the 90 day bill rate has remained range bound for up to 12 months at a time and the Cash Rate Target has remained unchanged during those periods too. This won't stop the MSM from squeezing out the usual hype on interest rates every month - instead of looking at the charts :-)


The RBA increases rates today by 0.25%. The only logic in this decision was because the rise was delayed from last month due to the election - as a rate rise straight after the election would put undue pressure on the Government.

The RBA Cash Rate Target is now where it needs to be based on historic relationship with the 90 day bill rate as discussed in the previous RBA post.

Monday, November 1, 2010

Ending Diagonal Forming on the All Ordinaries?

Since mid September the XAO index has moved in waves of 3, which has provided difficulty in establishing a firm count over the short term. However, there is strong evidence that wave 'iv' is an expanding triangle and the move upwards since the 5th Oct is an ending diagonal. Ending Diagonals must have overlapping wave 2 and 4's, move in waves of 3 AND wave 3's must not be the shortest wave. Therefore wave '5' circle cannot be longer than wave '3' circle in the current scenario.

Wave '4' circle could still be developing (possibly as a triangle), however the upside target should still be  around 4800 or slightly higher, perhaps with a throw over on higher volume.

The MACD price oscillator still continues to be divergent against the XAO on the 60 minute and daily charts. (MACD will usually hit an extreme near the completion of wave 3's, or wave 3 or 3 etc, and be relatively consistent at different time scales).

The bigger picture is here

Tuesday, October 26, 2010

Wave 2 regains some momentum

In the last chart,  there was a real possibility that a top was at hand for wave '2', however, we have seen a new short term high on the index that invalidates the short term count.

What one hopes to see after the top is at hand is:  1) fives waves down, and 2) a break of the 'ii-iv' trend line in less time that wave 'v' took to form. It appeared a very small five wave decline had commenced at the green dot in the chart below, but it failed to break the light green trend line (the previous 'ii-iv' line) quickly enough -  taking twice as long as wave 'v' before a break eventuated. This condition provides a warning that  wave 'iv' may not have completed.

With the long drawn out sideways action on the XAO, consistently moving in waves of 3, it is very likely that a larger triangle has been forming as shown below. It's unclear how much further wave 'v' has to go depending on how you count the internal subdivisions, but I suspect further upside is needed perhaps to the 76% retrace.

The new "ii-iv" trend line is now drawn - same rules apply.

Tuesday, October 12, 2010

Wave 2 update

A short update: It appears that wave '2' may have ended yesterday with the XAO failing to drive higher today. For confirmation, the index will need to drop thru the trend lines discussed in yesterdays post in sets of 5 waves down.

Monday, October 11, 2010

XAO topping

The All Ordinaries index appears to be in the final stages of the topping process. In the chart below two triangles at different degrees are evident and will complete wave (c) of '2'.

The index hit a key target today @ 4773 described in the last post and declined for the rest of the day, but I suspect there is still further upside to go as the decline does not appear to be a 5 wave move right now.

In support of the wave 2 topping, two triangles are evident on the short term count and indicate an upcoming trend change. The first triangle is an expanding triangle for wave 'iv' and the second is a smaller triangle wave '4' circle, both are indicating a upcoming change in trend of a higher degree. Thus, it is anticipated that wave '2' will come to an end in as little as a few trading days or into the early part of next week.

Breaks of the short term wave 2-4 circle trend line and the slightly longer term wave ii-iv trend line will be key indicators that will signal a potential major change in trend. 

Possible target area:
  • at 4816, wave '5' circle will be equal to wave '1' circle.

Wednesday, October 6, 2010

XAO - Wave 2 pushing higher

The previous count for wave '2' has been invalidated as the XAO hit a new high today and casts significant doubt over a double flat correction. An alternative count below shows wave '2' still unfolding but as a single flat correction.

One deciding factor is interpreting wave 'i' of (c) - it could be counted as 3 or 5 waves. Counted as 5, it provides the first leg of wave (c) up. The minor issue in this count is wave 'ii' and 'iv' of wave (c) overlap ever so slightly - sometimes due to opening and closing extremes on the all ordinaries index.

Some upside targets for wave (c):
  • At 4775 = 38.2% of wave i of (c) 
  • At 4874 = 61.8% of wave i of (c)
Wave (c) could possibly be complete as of today due to the new high, but a break below the wave ii and iv trend line (not shown) will need to occur before we can consider 5 waves up complete.

It's also interesting to note the RBA left interest rates on hold this month - politics at play for the new Government? Further upside on the 90 day rate will force the RBA to reconsider the cash rate target at the next monthly meeting.

Friday, October 1, 2010

Interest Rates - How the RBA doesn't influence the cash rates

It'll soon be that time again, and the usual hype around where interest rates are going will be in the MSM. For anyone who takes the time, they can download the Historic rate data from the RBA web site and determine for themselves where the RBA cash rate target is most likely heading. Have you ever wondered why the MSM don't publish comparison charts (like the one below) prior to the RBA interest rate decision? Simple: The media hype it up every month - hype and fear sells news, in addition nobody in the MSM wants to undermine the RBA.

The RBA insists that it influences the cash rate in the market, but I contend that it is the market that sets the interest rates and the RBA simply follows the trend (as best they can). Some folks even believe that the market "anticipates" the RBA rises in advance and hence that is why the target cash rate and 90 day bank bills are tied closely together. Gees, I'd like to know who these rate experts are and how they are almost 100% correct each and every time and what their predictions are for the next 12 months. Maybe they should swap jobs and predict stocks each day.

Seriously, a cursory look at the rate charts prior to a RBA rate "decision" will provide a good glimpse into what is the most likely outcome. As of the 29th Sept, the difference between the cash rate target and 90 Day bill rate is almost +0.5%. It's highly probable that the cash rate target will rise by 0.25% (unless politics gets in the way soon after the election). The average difference between these two rates over the long term is +0.1% and over the previous quarter is +0.3%. Since there is almost a 0.5% difference at the moment, then rationale suggests that a 0.25% rate increase is likely.

The daily chart below shows the RBA cash rate target lagging the 90 day bank bill rate.

Tuesday, September 28, 2010

Long Term XAO - multiple areas of resistance

The XAO has encountered several areas of resistance shown and/or discussed in the chart below - this should indicate caution as a potential change in trend is at hand. Also on the shorter term, it appears 5 waves up can be considered complete for wave (c) within the large wave '2' structure discussed in previous posts.

Breaking confidently higher (esp on higher volume) would indicate an alternative count is possibly unfolding at least in the short term.

Thursday, September 23, 2010

Wave 2 near 61.8% Retracement

Wave '2' has almost reached  the 61.8% retrace level and wave (c) appears to be at an end or very close depending on how the subdivisions are counted.

Also, on XAO volume  (not shown below), since the 16th of Sept the volume on the XAO has fallen to very low levels. Changes in volume do occur near the start/end of waves and can help identify changes in trend and is most accurately viewed on the daily charts.

Tuesday, September 14, 2010

All Ordinaries near critical juncture

The XAO has continued to stay within the up-sloping channel for wave (c) and there is potential for the XAO to continue higher under the wave count shown below.

Wave '2" details
The first chart shows the bigger picture with the 2nd flat reaching a critical point - it is at the top of the overall wave '2' channel and I suspect it will have enough momentum to break through and cotinue higher to near the 61.8% retrace at 4723. At this level, wave (c) will also reach the top of the green channel that represents the typical boundaries of a flat correction - in this case the 2nd flat.

Wave (c) details.
The detail count of wave (c) is shown below and indicates there is still a need to push higher before the final 5th wave (which is sub-dividing) completes.

Wednesday, September 8, 2010

XAO Wave 2 of 'C' Circle - Updated

In the last post, I discussed a break above 4620 would invalidate the current count - slightly. The break to 4628, a mere 8 points and the upwards thrust that appears to be 5 waves (wave (c) ) provides additional insight for wave '2'. Basically, wave '2' is still unfolding - but as a double flat correction as shown below.

There is still room to move on the upside as it appears that wave (c) isn't quite complete. For completion, a small drop today then a push higher would finish this wave over the next several days.  A target area of around 4640-50 would be ideal and form a double top from June. Breaking confidently down thru the up-trending channel lines (shown) for wave (c) before heading higher(<--correction) could be a strong indication that wave (c) is already complete.

The overall XAO view can be found here for wave 'C' circle

Sunday, September 5, 2010

XAO must stay under 4620

The All Ordinaries index must stay below 4620 for the current wave count to be valid. A break above this level will either:
  • indicate further wave '2' action, or
  • indicate that wave 'B' circle is yet to finish and will break higher again. If the index continues higher from here, then the correction that started in mid-april may be considered a triangle - indicating an upcoming change in trend in the medium term.
On the very short term,  it appears an ending diagonal could be under development since last Wednesday and one more small 3 wave push upwards is needed to finish this leg.  For the ending diagonal to remain valid, the index cannot climb above 4605 (wave 3's cannot be the shortest waves). On the technical front, the RSI and MACD price oscillator are in oversold territories indicating a short term correction or change in trend may be at hand. Will the Luna half moon from last Thursday still have a say in the short term? It still has another day or two to prove itself.

Wednesday, September 1, 2010

Luna Lunacy on the XAO

Yes Yes, I know what you're thinking, but you see, I just have to know....

...and the correlation between lunar cycles seems uncanny with the short term changes in trend with the XAO by + 1 day. The key signal appears to be the half moon cycles that represent a greater share of the trend changes than any other luna phase.

Yesterday, I discussed the very real possibility of the XAO climbing to complete a 5 wave move to complete wave (ii) as a flat. This is occurring today and thus, a change in trend may indeed be at hand and will tie nicely with the half moon phase tomorrow.

It'll be interesting to see how the half moon phase theory holds up over a longer time period. It'll also be interesting if specific moon phases favour any particular waves and degrees of trend.

Tuesday, August 31, 2010

XAO Short term action

There's several Elliot Wave interpretations for the short term Australian All Ordinaries as of the close today. The wave structure hasn't broken down as anticipated in an aggressive manner, thus, caution is required until clarity on the wave structures is available. The use of channel lines provides guidance in the short term for potential upside stops.

For wave (ii), either it has completed and another subdivision is unfolding (in waves 'i' and 'ii') or a flat is occurring for wave (ii) which can see further upside to around the 4523 level. Once complete, a series of wave 2's would have completed and the XAO downside aggression should commence.

Friday, August 27, 2010

S&P500 ready for a break to the downside?

It is anticipated that the S&P500 is preparing for a break to the downside over the coming weeks as wave '3' gets underway. A down sloping channel in green provides strict guidance for the upside boundary - a confident break above the top channel line will indicate that the alternative count is most likely unfolding and bring scrutiny for wave 'B' circle.

For the primary count, Wave '2' is considered complete as a flat correction (evident for wave 2's), and thus, strict guidance on how the wave structure must unfold downwards must be observed. This means the index must unfold to the downside in a series of fives waves - aggressively. However, the short term shows some upside potential as the the first small five waves down appears complete.

Thursday, August 26, 2010

XAO - The bigger picture

The Bigger Picture of a Zig-Zag correction on the Australian All Ordinaries

A few posts back I provided a long term chart of the XAO that covered the last 120+ years, one key point shown was the clear break from the very long term trend line from 1975 onwards. This date and one other - 1987, are two key dates on the chart that represent wave 4's of different degrees of trend. I'll come back to the importance of these dates later.

The first assumption on the chart below is that a zig-zag (5-3-5) correction is unfolding on the XAO  on such a scale that hasn't been seen in decades and probably won't be seen again in anyone's lifetime. Supporting this outlook is an initial 5 waves down from the 2007 top completed in March 2009 - labeled as 'A' circle. This is an ominous sign as 5 waves down requires another 5 down to complete a corrective phase.

'B' circle is assumed complete and is a 3 wave correction, leaving wave 'C' circle down to unfold.

The downside targets of wave 'C' circle are shown on the linear scale chart below. Several downside targets are represented - with 1261 being the wave '4' triangle correction in 1987-1992 and an extreme target that represents the wave '4' of next higher degree from 1975 (Corrections will usually aim to complete in the vicinity of a previous wave '4' or further)

1975 was the start of the most aggressive leg of the credit era and there is strong belief by a few analysts that this credit era needs to unwind - aggressively. Unwinding of the XAO back to the century long trend line would see the XAO at around 1000-1200 points, or in other words the 1987 wave '4'. 

Friday, August 20, 2010

More sideways on the XAO?

The Australian All Ordinaries appears to still be unfolding sideways with wave (ii) of '3' and I suspect a small push upwards may be needed to complete (ii).

The real question is whether the Labor or Liberal party will win tomorrow's election.  The outcome will not affect the market, but there is a high possibility that Labor will retain leadership as the social mood in Australia is not at a extreme low to warrant a change of Government. Labor did undertake a dumping of prime minister Rudd to avoid losing on election day - a very good strategy in hindsight which seems to have brought stability to the party.

In bear markets, Governments typically aim for more control, grow much larger, budgets are wasted on stimulus (same as in 1929), new ways to collect more tax credits is sought and misleading the public to drive change are typical attributes. These can all be witnessed today in both sides of politics in Australia.

The worst possible outcome is to allow either party a majority in the senate. A Labor/Green alliance would give unprecedented control to the Government and Australia would see the introduction of aggressive 'green' laws, a Carbon Pollution Reduction Scheme and most likely a revisit of the Copenhagen treaty which is a demonstrated front for a World Government - The very attributes of control which occurs in recessions/depressions.

Tuesday, August 17, 2010

XAO Very Short Term Action

The very short term XAO wave count is at a critical point which could see the index roll over to the downside in the next couple of trading days.

Friday, August 13, 2010

Wave 2 Complete

In the last update, the XAO needed a little sideways action to complete a small wave '4' and then a push up to finish wave (c). This has occurred precisely as described and the expectation is for further declines. 

Since Wave '2' is now complete, the XAO must continue to lower levels with aggression for wave '3'. If this 'aggression' does not materialize, then this should be a warning for a period of uncertainty. A confident break below the end of wave (b) in less time than wave (c) took to develop will provide strong supportive evidence that wave '3' is underway.


Friday, August 6, 2010

XAO still Trending Sideways

In the last medium term post discussing  Wave 2, there was potential for further sideways action. I believe that this is currently the case and a set of very strict conditions has been imposed on the unfolding wave '2'. Under a flat correction, the final wave (c) must be a 5 wave thrust to complete the large wave '2' correction .

As the chart below is already two days old, there has been sideways action for the unfolding small wave '4' of wave (c). Once complete, another small push upwards is needed for wave '2' completion. If this count is flawed, then we'll know very quickly.


Tuesday, July 13, 2010

Head and Shoulders on the XAO (again)

The Australian All Ordinaries is displaying a major Head and Shoulders pattern, an ominous sign for the index. This pattern also helps to confirm the bearish Elliott Wave count discussed in previous posts.

Looking back at the 2007 top, it too displayed a down sloping Head and Shoulders pattern that was the commencement of the global financial crisis. The down sloping neckline usually indicates a very bearish stance, this same down sloping neckline (same exact slope) is visible once again right now on the XAO at a smaller degree of trend.

Being of a smaller degree, the expected declines on this current H&S pattern will initially be less that of the 2008 GFC and will form a wave '3' (as described here). However, it is anticipated that the declines will eventually exceed the bottom seen in 2009 and play out as described in this recent post.

Sunday, July 11, 2010

XAO Long Term Trend

I was kind of inspired to write this post after watching about 5mins of 60 minutes tonight which had a segment on the Global Financial Crisis and the ongoing impact to retirees. The GFC has had an incredible impact to many retirees and those expecting to retire in the next few years - it became quickly apparent that another major downturn will have perhaps an unrecoverable impact for many. I think the general view from those interviewed was the 'hope' that the GFC has ended and a slow recovery is underway.

It always amazes me the number of folks that swear that analyzing trends and establishing trend lines are key to developing a investment strategy, however, the use of trends suddenly become "relaxed" on the very long term charts because they "don't apply" anymore or the market has "changed". My point is that trends on any scale are important, it just so happens that major corrections don't come along all that often for many to worry about (until it's too late of course).  The market works in cycles, hence major corrections have occurred and will occur again - Trends will help establish the starting and ending points of those cycles.

120 Years of Progress
One thing is for certain, once a trend line has been established the stock or index will eventually meet or break that trendline once again. The 100+ year All Ordinaries is a good example of a massive departure from the underlying trend starting in the mid 70's (start of the credit era).

The chart below provides an Elliott Wave count of the XAO for the last 120yrs. A meeting of the trend line is around 1000 points - a scary thought. What would you say if the chart below wasn't a 120 year chart, but only of 120 days instead? You'd probably think that a correction back to the trend line would be fairly normal and fit well within your investment strategy. As you can see - the issue isn't with the trends and the corrections that occur within the trends, but with TIME.

It is fairly normal for markets to correct on the long term charts, it will punish investors that are not looking at short and long term trends and a strategy to avoid risk if such a scenario should unfold. Sorry, hope isn't one of them. Some of those interviewed clearly understood this and have taken back control of their hard earned finances (which was good to see).

XAO Ready for a Fall?

In this post here, discussed were 2 highly probable possibilities for the ending of wave 'B' circle - either it was already completed or another push higher needed to occur.

As I write this, the XAO is nearing a significant threshold - if wave 'B' circle has in fact completed, then a strong push to lower levels should soon occur and provide a good indication that wave '3' is underway. Otherwise a less likely scenario in that the recent drop from the 5000 level is a 3-wave correction that has ended or needs to unfold lower before completing. Either way - having an understanding of the most probable scenarios will provide an early warning should the preferred scenario not play out as desired.

A break upwards and out of the down sloping channel will provide evidence of further upside potential or more sideways action of an incomplete wave '2'.

Many in the mainstream media claim that the Global Financial Crisis is over and a recovery is underway (although only lukewarm). However, analyzing the financial stability of many banks (in the US and Europe) seems to portray a vastly different picture. The evidence is yet to confirm that the financial sector is on stable ground - I suspect another wave of failures and losses is not far away.

Tuesday, May 11, 2010

XAO - Holding above 4500

The XAO has pushed higher as indicated in the last post, however, the next one or two trading days should provide a lot more clarity as discussed in the chart below. Today's action had many scratching their heads since the DJI was up 400+ points at the close, yet the XAO declined 49 points in today's trading.

Friday, May 7, 2010

XAO - 4500 is broken

In the last post I indicated that under an expanding triangle scenario, the XAO would need to come close to the 4500 level. Today that occurred, apparently due to 'concerns' about Greece, the new mining sector tax or potentially the weather :-)

Keeping above the 4500 level now is imperative for the expanding triangle to remain as a primary count - hence a series of clues will be provided by the XAO over the next few trading days.

A closer look at the final wave (e) leg is below. Under an expanding triangle, wave (e) should nearly always be the longest wave.

Tuesday, May 4, 2010

XAO - More Potential Upside

The XAO has been trending sideways since October 2009 which can be  representative of a large correction. This correction could be a (B) wave Expanding Triangle (as shown) or a flat [the first blue (a), (b), (c)].

As corrections can be difficult to gauge until near complete, following the trend using parallel channel lines can be very useful in determining individual segments of waves. In addition, the MACD Price Oscillator provides insight when waves are near completion (eg Extreme signal on completion of wave 3 at various degrees of time).

 The potential action over the coming weeks calls for a correction upwards in the short term and one final push down to compete the last wave of the expanding triangle (to perhaps the 4500 level). Should this not unfold, then the final wave upwards to wave 'B' circle can be assumed to be already underway.