Chart Reading 101

Trader’s Classroom by Jeffrey Kennedy Monday, November 17, 2014Let’s Count Waves TogetherMarket: AMRI, HRG, and CHGGIt’s been awhile since we practiced labeling price charts, so that’s what I thought we would do in today’s episode in AlbanyMolecular Research (AMRI), Harbinger Group Inc. (HRG), and Chegg, Inc. (CHGG).The wave pattern in AMRI is easy to identify — it’s an impulse wave. Moreover, the final wave of this sequence took the shapeof an ending diagonal, which portends selling back to below the origin of the pattern at $14.38. If we go one step further andcan apply the guideline of depth of corrective waves, we can anticipate an even larger decline back to near the previousfourth-wave extreme at $9.71.I’ve offered two different wave counts of HRG, both of which imply a sizable sell-off. The purpose behind the dual labels is thatone is correct and one is incorrect. I’ll explain in detail in today’s video. Similarly, I’ve done the same thing in CHGG. Both El-liott wave interpretations are bullish. However, one contains a rule violation which invalidates the interpretation altogether.PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------PO Box 1618 • Gainesville, GA 30503 USA [email protected] • 800-336-1618 • FAX 770-536-2514 © 2014 Elliott Wave International