Long Term Elliott Wave Analysis for Dow Jones Industrial Average

The US stock market started from 1792 in Boston.  Up to year 2015, the market has passed 223 years.  During this long period of time, there were bulls and bears, grooms and dooms. However, from an Elliott Wave theory perspective, the Dow Jones Industrial Average (“Dow”) is still unfolding a five wave pattern.

Look at the Dow on the semi-log yearly chart below, the 1929 stock market crush is treated as the super-wave (IV) correction.  Commencing from 1932 at the index low of 386, Dow emerged into a super impulse wave (V).

Super wave (V) is unfolding in five cyclical wave:  cyclical wave I brought the Dow from 1932 low to 1937 high, corrective wave II was the result of the pre-World War II recession, bringing the Dow to the 1942 low; in anticipation of the end of the World War II, the Dow entered into a long term impulse wave III until 1967; the first oil crisis and abortion of gold standard in 1972 led the Dow into a 7-year bear market until 1974, unfolding cyclical corrective wave IV; and from 1974 low, we are in the super bull market characterized by the fifth wave extension, the cyclical impulsive wave V.

Cyclical wave V is characterized by five conspicuous sub-waves: impulse wave ① set off from 1974 low and ended in 1977 high; corrective wave ② was triggered by the second oil crisis which ended in 1982 low; then we witnessed the longest bull market in recent years, which illustrated the extended third wave characteristics in impulse wave③ which ended in 2007; the financial crisis in 2007 and 2008 brought forward the destructive corrective wave ④.  Now we are in the impulse wave ⑤ since 2008 low.  We are yet to confirm the ending of impulse wave ⑤.