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A quick update of the preferred bear wave count at the hourly chart level only.

My CMT ethics guidelines require me to notify members of any opportunity I see before I take advantage of it myself.

If the bear wave count is right and a leading expanding diagonal is unfolding, then this may be the end of upwards movement.


S&P 500 daily bear 2015
Click chart to enlarge.

This would at this stage still be my preferred wave count for the S&P. It looks like a leading expanding diagonal may be unfolding downwards. The final fifth wave should be incomplete.

Diagonals normally adhere well to their trend lines. So if this wave count is right, upwards movement should stop here because price may find resistance at the upper (ii)-(iv) diagonal trend line.

The fifth wave must be longer than the third wave in length to meet the rules for an expanding diagonal, so the fifth wave must end below 1,976.13.

First, third and fifth waves of leading diagonals are most commonly zigzags. At 1,949 subminuette wave c would reach 1.618 the length of subminuette wave a.

Subminuette wave b may not move beyond the start of subminuette wave a. The risk for this wave count is low, and the reward is high. The risk / reward ratio is 1:9.7.

This analysis is published about 11:22 p.m. EST on 23rd December, 2015.