Gann’s Mean of Five and Cycle of Eight and IBM - Canary in the coal mine?

I recall the 2002 bottom when EWI were calling for the dreaded further decline into the unfathomable abyss….we all know how Prechter and Hochberg can paint it.  And then IBM announced.  The next issue of the Short Term Update was “we don’t know what happened or where the EW count is but you need to move to cash.”  Several days/weeks later there was a re-thunk cycle count at the largest levels (expanded/irregular flat perhaps).  Ditto the 2008 bottom where IBM, with Nasdaq 100 in tow, bottomed on 11/21/08, three months before the broader market.

Today I was reading a newsletter that argued so goes IBM so follows the market and I would not hazard to disagree.  That newsletter applied “planetary lines” to show IBM’s movements relative to the stars ….a method revealed in his book.  Hmmmmm, what might those esoteric methods be that would cost me the price of the book and the even more expensive use of my time?

In about 5 minutes I’d reproduced his chart.  Simply Gann’s “mean of five” (the large 6 planets minus Mars):

The MOF 2X1 cradles the 2013-14 lows and, arguably, halts IBM’s price decline.  The 3X1 is equally as dramatic as price forms around it to the top.  And once the top was in and line was broken there was a steep decline to the 2X1. 

Gann’s “Cycle of Eight” has an even better micro correlations with IBM price and some interesting implications:

Each of the above angles correlate with price for a segment of time and when price departs that line it falls quickly to the next lesser angle.  So what about the 1X8, IBM price is only halfway there?  If you put a Fibonacci retracement on the drop from the very top in March 2013 (215.90) to February 2014 (172.19), you’ll see that IBM has recovered about midway between 50% and 61.8% of that loss. 

Now especially note that IBM topped in 2013 and is a good 40 points or 20% from that ascending COE 1X4 planetary line.  Does IBM’s top in 2013 lead the indices, that is, lower?  Or is the market now leading IBM by having made new highs with IBM to follow? 

My expectation is that IBM recovers to 61.8% (199.21) and then…..

IBM releases quarterly earnings on 4/16/2014.

Jim