Australian Financial Sector - Long Term update

In the previous long term XFJ update the index appeared to be correcting as a large Triangle for wave B circle. So far, the wave B triangle is continuing to unfold as highlighted almost a year ago with four legs of the triangle completed. The last, wave 'e' is now underway and needs to push higher to the 4000 levels or slightly higher. Once completed, the next major leg down will be underway and take the index down to unprecedented levels.

Perhaps this trader understands what is really going on as opposed to the mainstream media who pick out of a hat the suggestions on why the markets moved the way they did. Notice the high use of the default verb "hope" in many financial headlines as the international markets continue to remain volatile and "unpredictable".

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: