STI - Elliot Wave

Today i watched a video in which a guy fits Elliot Waves into an S&P500 weekly chart. He managed to fit three waves and mentioned that the S&P500 is currently on the fourth upwave and that the fifth wave down will take the S&P500 to the 500-point level. (It is currently at 842). For this view to be invalidated, the S&P500 needs to trade above 930 (or around there). I wonder if this is the case for the STI. I pulled up the STI weekly chart and drew in what i think are the major up and down waves. (The lines are in thick yellow). Voila! I managed to draw five waves!; three major down waves and two minor counter trend waves. (If i read Elliot Waves correctly, the theory says that a major trend consists of five waves; three in the direction of the major trend and two counter trend waves. Thereafter, a reversal?) According to what i managed to draw, the STI completed its five waves down and is time for it to rally. Really?

Maybe some people will draw the waves differently and conclude that we are only at wave four. i suppose they are, or maybe were, busy shorting the market at every rally, hoping to be early in catching the major fifth wave down, but finding themselves caught at the wrong side of the trade and having to close their short positions. I believe this is one of the reasons that this 'rally' that we are seeing since early March is so strong. People who went short discover to their horror that the market is racing ahead and so they close their short position by going long. People at the side watching the market roaring ahead cannot stand waiting at the sidelines anymore, and so they too jump in and go long, thus adding more fuel to the 'rally'.

Be wary of people hyping up the current market conditions by saying that this is a bear market rally, or that we are only at the forth leg of Elliot wave and that a major fifth wave down is coming, or that we are now in an 'overbought' situation and that a correction is imminent. Look at the chart objectively and as far as possible, go with the trend. Of course you may trade counter trend, but you need to be much more nimble in getting out when the trade goes agains you.