Upwards movement with lighter volume to complete a small green doji is weak.
Targets and expectations remain the same.
Summary: Price should move a little higher to complete a small correction when markets open tomorrow. Third waves often start out slowly with a series of second wave corrections before the middle arrives. It is most likely that price will not move above 1,947.2 tomorrow, but there is a small possibility it could. Price should continue to find resistance at the cyan line on the daily chart. The trend is down and the strongest part of a middle of a third wave is approaching, so look out for surprises to be to the downside.
To see how each of the bull and bear wave counts fit within a larger time frame see the Grand Supercycle Analysis.
To see detail of the bull market from 2009 to the all time high on weekly charts, click here.
Last published monthly charts can be seen here.
If I was asked to pick a winner (which I am reluctant to do) I would say the bear wave count has a higher probability. It is better supported by regular technical analysis at the monthly chart level, it fits the Grand Supercycle analysis better, and it has overall the “right look”.
New updates to this analysis are in bold.
BULL ELLIOTT WAVE COUNT
DAILY CHART – COMBINATION OR FLAT
Click chart to enlarge.
This wave count is bullish at Super Cycle degree.
Cycle wave IV may not move into cycle wave I price territory below 1,370.58. If this bull wave count is invalidated by downwards movement, then the bear wave count shall be fully confirmed.
Cycle wave II was a shallow 0.41 zigzag lasting three months. Cycle wave IV should exhibit alternation in structure and maybe also alternation in depth. Cycle wave IV may be a flat, or combination.
Cycle wave IV may end within the price range of the fourth wave of one lesser degree. Because of the good Fibonacci ratio for primary wave 3 and the perfect subdivisions within it, I am confident that primary wave 4 has its range from 1,730 to 1,647.
Primary wave C should subdivide as a five and primary wave Y should begin with a zigzag downwards. This downwards movement is either intermediate waves (1)-(2)-(3) of an impulse for primary wave C or minor waves A-B-C of a zigzag for intermediate wave (A). Both these ideas need to see a five down complete towards the target, so at this stage there is no divergence in expectations regarding targets or direction. When and if these two ideas diverge, I will separate them out into two separate charts. For now I will keep the number of charts to a minimum.
Primary wave A or W lasted three months. Primary wave C or Y may be expected to also last about three months. It is now in its second month at this stage and may not be able to complete in just one more. It may be longer in duration, perhaps a Fibonacci five months. That would still give a combination the right look at higher time frames.
Within the new downwards wave of primary wave C or Y, a first and second wave, or A and B wave, is now complete. Intermediate wave (2) or minor wave B lasted a Fibonacci 13 days exactly. At 1,693 intermediate wave (3) would reach 4.236 the length of intermediate wave (1).
This daily chart and the hourly chart below both label minor wave 3 as complete. It is also possible that the degree of labelling within minor wave 3 could be moved down one degree, because only minute wave i within it may be complete. The invalidation point reflects this. No second wave correction may move beyond its start above 2,081.56 within minor wave 3. If this bounce is minor wave 4, then it may not move into minor wave 1 price territory above 1,993.26.
Price has come up to find resistance at the upper cyan trend line. This line goes back to 20th July, 2015, (its first anchor) and is reasonably shallow, has been repeatedly tested, and has reasonable technical significance. It should be expected to offer reasonable resistance and this may end the upwards correction here.
Price found some support about the lower cyan trend line today, which is drawn across the lows from October 2014 to August 2015. Downwards momentum may show an increase once price breaks below support about this line.
HOURLY CHART
Click chart to enlarge.
At this stage, the corrective structure which has the best fit is a double zigzag. This movement now has a clear three wave look to it on the daily chart.
If this is a fourth wave correction, then the least likely structure for it would be a zigzag or zigzag multiple. That would not provide adequate alternation with the second wave zigzag.
However, alternation is a guideline, not a rule, and it is not always seen.
The probability that a fourth wave is unfolding has reduced. The probability that this bounce is a second wave has increased.
Because both bull and bear wave counts see this structure in the same way on the hourly chart, further comment will be with the bear wave count.
BEAR ELLIOTT WAVE COUNT
DAILY CHART
Click chart to enlarge.
This bear wave count fits better than the bull with the even larger picture, super cycle analysis found here. It is also well supported by regular technical analysis at the monthly chart level.
Importantly, there is no lower invalidation point for this wave count. That means there is no lower limit to this bear market.
Downwards movement so far within January still looks like a third wave. This third wave for intermediate wave (3) still has a long way to go. It has to move far enough below the price territory of intermediate wave (1), which has its extreme at 1,867.01, to allow room for a following fourth wave correction to unfold which must remain below intermediate wave (1) price territory.
Intermediate wave (2) was a very deep 0.93 zigzag. Because intermediate wave (2) was so deep the best Fibonacci ratio to apply for the target of intermediate wave (3) is 2.618 which gives a target at 1,428. If intermediate wave (3) ends below this target, then the degree of labelling within this downwards movement may be moved up one degree; this may be primary wave 3 now unfolding and in its early stages.
The correction for minuette wave (ii) may be over totalling a Fibonacci eight sessions and finding resistance at the upper cyan trend line. A small channel may now be drawn about this correction. This channel is now breached at the hourly chart level. The channel is still not clearly breached at the daily chart level. I define a breach as a full candlestick below the line and not touching it. It looks like price has moved higher at the end of Wednesday’s session for a classic throwback to the line.
Intermediate wave (2) lasted 25 sessions (no Fibonacci number), minor wave 2 lasted 11 sessions (no Fibonacci number), minute wave ii lasted 10 sessions (no Fibonacci number) and now minuette wave (ii) may have lasted a Fibonacci 8 sessions. Each successive second wave correction of a lower degree has a shorter duration which gives the wave count the right look, so far.
If minuette wave (ii) continues any higher, it may not move beyond the start of minuette wave (i) above 2,081.56. When the channel about minuette wave (ii) is breached by a full daily candlestick below it and not touching it, then the invalidation point may be moved lower at the daily chart also.
The degree of labelling within minute wave iii may also be moved up one degree. This correction may be minute wave iv. I will wait to see how momentum behaves for the next wave down to make a final decision on which degree of labelling is correct. For now I will leave the labelling as the most likely for a second wave due to the duration and the structure of a double zigzag.
If the next wave down shows a strong increase in momentum, then it would be the middle of a big third wave.
If the next wave down shows weaker momentum than minuette wave (i), then it would be a fifth wave to end minor wave 3.
I have two hourly charts for you today, and both work in the same way for bull and bear.
MAIN HOURLY CHART
Click chart to enlarge.
If minuette wave (ii) is over, it would most likely be as a double zigzag. This has a neat fit.
The downwards wave labelled subminuette wave i will fit as a five wave impulse on the five minute chart, but there it suffers from a problem of proportion with the second and fourth wave corrections within it. This gives it a bit of a three wave look at the hourly chart level.
Upwards movement for Thursday’s session fits now as a completed five, so the next second wave correction would be incomplete.
Subminuette wave ii is finding resistance at the lower edge of the channel for minuette wave (ii). It may continue to do so. It looks like it is unfolding as a zigzag; micro wave B looks like an almost complete triangle. Micro wave C upwards may unfold at the start of tomorrow’s session, and it is likely to move above the end of micro wave A at 1,927.35 to avoid a truncation.
At 1,511 minuette wave (iii) would reach 1.618 the length of minuette wave (i). If this target is wrong, it may not be low enough. The next Fibonacci ratio in the sequence is 2.618 which would give a target at 1,242, but that looks too low.
The small channel about subminuette wave ii should be redrawn, if micro wave B continues further. When micro wave C has moved higher, then a subsequent breach of this violet channel would provide trend channel confirmation that subminuette wave ii should be over and the third wave down should continue.
Subminuette wave ii may not move beyond the start of submineutte wave i above 1,947.2.
ALTERNATE HOURLY CHART
Click chart to enlarge.
What if my labelling of minuette wave (ii) is wrong? What else could it be?
Upwards movement to the last high will not subdivide as an impulse. I cannot find a solution where that fits. It will subdivide as a single zigzag, if a small truncation of 1.94 points for submicro wave (5) to end micro wave A is accepted.
The downwards wave labelled subminuette wave x may now be seen as a three which does have a better look.
The biggest problem with this idea and the reason it is an alternate (so far) is the second zigzag in the double would not be deepening the correction very much (so far). Second and third zigzags exist to deepen a correction when the first (and second) zigzag does not move price deep enough. If the cyan trend line continues to offer strong resistance, then subminuette wave y would not be able to deepen the correction much and this structure would not have a typical double zigzag look. The second zigzag would not achieve its purpose.
The other less important problem with this idea is it would see minuette wave (ii) last longer than minute wave ii one degree higher. The main hourly wave count has better proportions for the second wave corrections.
This idea is technically possible, even though it has a low probability. Low probability does not mean no probability. If price makes a new high above 1,947.2, then it could continue much higher. The cyan trend line would have to be clearly breached. If that happens, then minuette wave (ii) may continue to be a deeper correction.
TECHNICAL ANALYSIS
DAILY CHART
Click chart to enlarge. Chart courtesy of StockCharts.com.
Two green candlesticks with small real bodies, and today with declining volume, is not a convincing new bull market. The trend remains down. This is a correction against the trend.
The multi day upwards correction is enough to resolve the daily and weekly hammer candlestick pattern at the last low of 20th January.
The evening doji star pattern at the last swing high comes after a short term upwards trend. This is not a strong reversal pattern, but it is a reversal pattern.
ADX is declining indicating there is no clear trend. It still does not indicate a trend change, the -DX line remains above the +DX line. The trend would still be down if it resumes here.
ATR is flat indicating the market is still consolidating.
On Balanace Volume is of concern today because it has slightly breached the green trend line. This line has only been tested three times though, although it is reasonably long held.
I added the brown line in trying to find a more reliable trend line for OBV. This line is more shallow and more often tested. If OBV breaches that line, it would be a stronger bullish signal. If OBV finds resistance at that line, it would be a bearish confirmation and the strength of the line would be further reinforced.
RSI is neutral. There is plenty of room for the market to rise or fall.
Stochastics is returning from overbought. With ADX indicating a consolidation market, expect price to move lower and to continue until price finds support and Stochastics reaches oversold at the same time.
Click chart to enlarge. Chart courtesy of StockCharts.com.
As price made a new high today, VIX turned downwards (inverted).
I have noticed that this very short term divergence between price and inverted VIX is often (not always) a fairly reliable indicator of the end of a price swing. This supports the idea of lower prices tomorrow.
DOW THEORY
For the bear wave count I am waiting for Dow Theory to confirm a market crash. I am choosing to use the S&P500, Dow Industrials, Dow Transportation, Nasdaq and I’ll add the Russell 2000 index. Major swing lows are noted below. So far the Industrials, Transportation and Russell 2000 have made new major swing lows. None of these indices have made new highs.
I am aware that this approach is extremely conservative. Original Dow Theory has already confirmed a major trend change as both the industrials and transportation indexes have made new major lows.
At this stage, if the S&P500 and Nasdaq also make new major swing lows, then Dow Theory would confirm a major new bear market. At that stage, my only wave count would be the bear wave count.
The lows below are from October 2014. These lows were the last secondary correction within the primary trend which was the bull market from 2009.
These lows must be breached by a daily close below each point. So far the S&P has made a new low below 1,821.61, but it has not closed below 1,821.61.
S&P500: 1,821.61
Nasdaq: 4,117.84
DJT: 7,700.49 – this price point was breached.
DJIA: 15,855.12 – this price point was breached.
Russell 2000: 1,343.51 – this price point was breached.
This analysis is published @ 11:43 p.m. EST.
hi
All
Have a great weekend! See some of the folks this Sunday night 😉
Again – I prefer data feed from – NYSE/Nasdaq/TSX Realtime Data imo…..
Watch the futures Sunday night, as stated yesterday in reference to a Zerohedge article, we could have Goldmans take on Chinas Fx reserves data.
What’s interesting is China is closed next week.
So it might be coincidence but either way the trend is down
Zero site is not something to really give hope on a trade.
there is a slight new low below 1,872.75 to 1,875.65
and that is enough to invalidate my B wave idea
and so I would expect that the correction was actually over at the last high and we are on the way down
for EW it doesn’t have to close below that point; any movement below that point at any time frame is enough to invalidate the count because no part of B may move beyond the start of A (when A is a five)
look out for surprises to the downside Monday!
I’m expecting some very strong downwards movement next week
Excellent. I appreciate the chart today intra day that really helped navigate all this noise!
A few of the members have 1872.23 as the invalidation point on our trading platforms. Could it be therefore we do not have an invalidation.
My data is supplied by BarChart, directly from the exchange.
It’s the most accurate I can get.
I’ll go with that.
I just want to comment on data feeds.
Actually, I have 3 separate feeds because I am just very cautious:
1. I have BATS
2. I have NYSE
3. I have a combination of other feeds from my broker platform that is unstable to be honest.
My most reliable feed is NYSE.
If everyone here is worried about feeds. I personally have 3- but I prefer NYSE here in the states – just imho.
Some members (including myself) are seeing the invalidation point slightly lower. My platform didn’t quite go below the last low. Wonder why the data is different.
In any case I guess it was so close that it is likely invalidated – I’ll go with your data to stay on the safe side!
Many thanks for your narrative again today Lara. I’m hoping very soon we can just buy and hold!
Have a great weekend everyone 🙂
1872.23 per Fidelity
Yeah – here’s my trading platform chart
Lara,
I am a bit confused. How can A have been a five wave structure if we just undercut A? Wouldn’t that mean that A must have been a 3, in which case could B move below A? Or are you saying that subminutte ii might have ended at what was previously labeled A of ii.
Thanks, and have a great weekend!
Peter
The new low below the start of A means my analysis of A as a five was wrong.
But I have a new idea which sees that move as a five; a C wave of a prior expanded flat.
Either way, it means the prior correction is over. And we should move lower now. That was the pivot point that we needed to indicate the most likely next direction.
I use thinkorswim and also am showing 1872.23 for the invalidation point.
tricky…so close….would hate not to position and miss a massive gap down. Would hate to position right here and eat a massive move up..
It is all part of the game!
I’m holding a 40% VIXY position over the weekend just in case.
If we gap lower, I’ll have to average in on any bounces.
If we go higher, I’ll buy more and average down.
Without full an final invalidation on this possible Wave B down, it is about the best I can do.
I stated about an hour ago that this is exactly what would happen as it is the most frustrating case scenario (most confusing).
The market makers clearly employ Ellioticians!
Joseph
Great read:
Does 1987 Have Any Lessons For Today?
http://www.zerohedge.com/news/2015-06-27/does-1987-have-any-lessons-today
Nice article. Thanks Joseph. That sort of crash is scary even to those who are short. It means a massive shock to the world.
Wow! Like a great football game, tied in the last minute. Will SPX break below 1872 ? Good job Lara identifying the pivot point.
12 minutes left. Probably not jut park it here or near to it!
Well on second thought maybe 6 minutes left….
Peter
1873ish lets see if we can push lower or not!
Now is the time…
That weekly candle looks nice now!
A close below 1880 on the weekly candle is significant. January 15th it closed at 1880.33
I agree rodney!
Did it! I think there is a very good chance it is “Look out below!” on Monday.
There will be margin calls. Millions of Baby Boomers will check their IRA’s tonight and catch fear. China has an announcement on Sunday evening. I think it has to do with their reserves. I suspect we will see a significant shrinking of their reserves and the start of a liquidity problem. That was the nail in the coffin for Lehman Brothers in the last Bear market. Now it could be China!
i agree…
Was going to close below 1880 and at about 4:04PM they adjusted to 1880.02
Yeah I see that now. Darn. The Banksters came in with a lot of money.
On second thought, the last weekly low was 1880.33. Therefore we closed lower for the week. That is enough to make it significant.
Okay!!! Too bad I can’t watch any of this Monday. Back on Tuesday.
Hopefully will be sub 1812!
BTW: For the candle stick crowd… you see the pattern of last three candles on the daily chart?
I do not recognize it. Can you explain. Thanks in advance.
PS Not a bad idea to wait for both indices to CLOSE below round numbers before going all-in on short positions. Bye’ ya’ll…have an awesome weekend!
Bottom fell out of UVXY. Final wave up probably underway. Grabbing a few speculative SPY calls a week out. I am outta here! Great weekend every one!
Sorry about those dud SDS calls Olga. I owe you one! 🙂 🙂 🙂
Why – you – little!! (as Homer Simpson would say to Bart) 🙂
Have a good weekend
Lara,
We had a slight breach of the recent low (I believe we hit 1872.65 a few moments ago). Is it possible that we are in fact still in minuette wave 2 (green ii), and that wave y is unfolding as an expanded flat.
Thanks,
Peter
On my chart I have 1872.22 as prior low.
Ditto – we didn’t invalidate on my platform. Might go lower anyway, but not had an inval yet.
For flat, wave A needs to be a 3 wave structure – currently wave A looks like a 5 though I have had my doubts.
Time will reveal all – my worse frustration scenario seems to be going to plan
I stand corrected. Yahoo has 1872.23 as the low two days ago, so we held just above it. Amazing.
Thinkorswim has 1872.65… I will stick with this as the low.
BTW – if wave A was a 3 wave structure then we could invalidate (go below 1872) for Wave B and still fly back up in Wave C for a flat.
The structure of Wave A is the huge clue to where we are headed – if it is a 5 and we have invalidated then watch out below!!
It certainly looks like a 5. Vix suggest we might be headed higher
Yes… 1872.65 was the low then three 5 min candles pop.
We have a penetration.
so we going down or what? Or a pop back to 1930s?
we took it out by only .10 at 1872.65 on stock charts here:
quote:
“If we do see a new low below 1,872.75 then this chart is wrong and we are on the way down, and yes Thomas, expect surprises to the downside!”
I am staying fully positioned for down. No Margin. Can’t be force out!
Waiting for the big one!
When Lara says that it means discard
which products do you trade?
SDOW and SPXS and I have Leap options 17 mo. out on those positioned since May.
oh o.k
You should all watch that video from 1987 posted below.
Down 25% that day. I would think today there would also be issues on a day like that. Look at some of the events that occurred recently in China. With a Hillary or a Bernie in charge… it might be an exact match of events.
That would be nice….
CNBC… now airing all the bullish snake oil salesman!
Complacency
Good – my short needs it right now!! 🙂
Now or never…
(Shorting VIXY – so it’s kind of a short short – little bit confusing)
We got close to invalidation but no cigar – Mr Market just loves to keep us guessing….
On my platform we didn’t quite invalidate (interactive brokers) – is my data wrong??
The low so far today is 1872.65 as of 3:06 PM EST.
I think a great addition to this website would be a chat room
I was saying that in the begining when i joined in nov last year!
Please add a chat room!
If you have to increase our rate to accommodate it is still great!
I quite like being able to come here later and see what has been happening (be able to read comments) so it kind of works for me as it is.
Not really sure how a chat room works – presumably the messages are not saved?
What would be the advantage of a chat room?
mainly some real time interaction as we watch ticks near crucial levels….like right now
Barry
so we going down still or what?
we did hit 1872.76?
everything is screaming down to me…but after this big down move so far I’ve locked in a good amount of my shorts. I’m curious what Lara thinks as since we did hit the 1872.75 it was a very brief touch and now bounce. I’m leary and considering some 191 SPY Calls
This is noise… I am staying fully positioned for the big one. No margin… so I can’t be forced out.
Me to. Can anyone say ‘Black Monday’. I too was there in 1987 for the 25% drop in one day. I expected to hear of people jumping out of windows. None of that but there were a few suicides.
I like what we have. Isn’t it just like a chat room? But isn’t that what we have? What is the difference?
I like this as well… I won’t use a chat room.
hi
all
is it if we tag 1872.76 just like now or we must get way below it that this has a high likelihood of continuing lower as opposed to bouncing next week early 1-3 fib days?
please clarify!
thanks,
-ace
My SDS calls are also dying on the vine…as are a few other very short term trades made in anticipation of that elusive third…recouped a bit with a quick QQQ trade earlier but short term trades this week mostly loosers…so far…
🙁
I typically play longer expirations
Me too. Those were mostly “fun” as opposed to serious trades. Helps a bit with the boredom of waiting for the real action! 🙂
If we don’t take out 1872 today are you ruling out the possibility that we don’t take it out on Monday and just continue down?
Don’t suppose anyone wants to buy my worthless SDS calls that expire today? Will sell for 1 cent (bargain!) – Market has gone bidless 🙂
My first encounter with options and probably my last! Predicting price is hard enough – it takes a far more intelligent person than me to predict both price and time.
Not only do you have to get the Price & direction right… you have to be right in the time period of the option.
Options are a great way to blow capital.
I had a ton of that evaporate in 1987.
Dollar is move higher today as well.
Agreed – will stick to cash (without margin) in future me thinks!
I don’t particularly like banks (or financial institutions or whatever they are) – and certainly don’t like transfering my wealth over to them.
I once traded options. I once traded futures with margin.
I haven’t done either for over a decade. I won’t do either one again. Needless to say, I was no good at it.
The index ETFs with leverage are enough for me.
Those are a gamble for sure. I had some longer time frame (3/18) SDS…73 contracts to be exact that I sold about 30 minutes ago. Not a lot of activity on those puppies. At least I banked since I had them at a much lower average.
IKR!
I’m still learning my trading approach to this particular market.
And I’m only trading CFD’s. No time involved.
Adding the time factor with options… I’m just not going to go there (maybe not for years). That’s way too hard! I’m sure there are easier profits to be had for me anyway.
Chances increasing market is going to sell off into the close. Keep an eye on those SDS calls as they yet may spring to life… I have an open order to sell at ten cents! 🙂
4 points away from 1872.75….let’s see
We are back below the Trend Line from low of 3-6-2009 to the low of 10-11-2011.
WTI DOWN 3.06%
This is what I have on the 5 minute chart today. But TBH, for what its worth, the reason why I don’t publish the 5 minute chart regularly anymore is I found it too subject to change. It just doesn’t add enough to the analysis in a reliable manner to follow daily in detail.
But for those who want it and are interested I have it today.
The hourly chart looks clear. The move up labelled micro A really looks like a five, not a three. Which means subminuette ii looks like its not over. Which all points to a final thrust higher on Monday to end slightly above A at 1,927.35 and probably to test that upper cyan line on the daily chart.
If we do see a new low below 1,872.75 then this chart is wrong and we are on the way down, and yes Thomas, expect surprises to the downside!
Fantastic – we’re on the same page.
Totally agree about the 5 min chart – Aside from the huge amount of extra work it would create you, I don’t even bother labelling the 5 min as it just changes all the time.
I’m also slightly superstitious – it seems as soon as I label the 5 or 1 min chart, the market invalidates it – when I just keep a mental note the market goes my way more often – very silly but seems to work for me!!
Agreed (on your first paragraph)
When I trade NZDUSD (my favourite) then TBH I don’t even keep a fully updated hourly chart.
I just don’t need to.
I check pieces of movement sometimes, is it a three or a five? to see how it fits into my daily chart, but it is the daily and weekly that I use for my own trading.
I note that a fair few traders have their own personal superstitions… interesting.
Re: superstition – I didn’t know that, but I’m not suprised. It’s probably a by-product of the way Mr Market likes to humble those who are a little too over confident 🙂
Well we are getting really close to that 1872 point. I see a completed head and shoulders on the 5 min chart that measures down below 1840. I think that will easily take us below the 1872 point. I’m thinking the current correction only makes it back to the correction trendline at 1890 or so. Didn’t I hear somebody recently say, “Expect surprises to the downside”? LOL
Volatility does not seem to have much confidence in the SPX move down.
What I think we are seeing is accumulation by smart traders. Pointing straight up. If we take out 1870 that is a game changer imo…
Agreed. Because the A wave up was a five, this B wave can’t make a new low below 1,872.
And so if that happens then my analysis of that A wave as a five is wrong and we are probably in the start of a big fast move down.
Yes. It all looks suspiciously like a B wave to me.
But then…. I could be wrong.
I’m putting my money where my mouth is though 🙂
Lows re-tested. Should see slow grind back up rest of trading day. I would not be surprise to see close slightly in the green. Monday should offer great entry positions for next downside leg. Have a great weekend everyone!
Picked up a few speculative QQQ puts on anticipation of retest of this morning lows. Looking for quick 15% pop, up 10% so far…oops! just sold at my price target!
Those SDS calls may yet have some life… 🙂
If the pattern continues, we will probably re-test this morning’s lows and see block buying toward the close. I am hoping we get some resolution of this choppiness on Monday with a final wave up.
At this stage that is my expectation.
This wave down today is a B wave and Monday will have wave C up to move back up to that cyan line on the daily chart.
And then we shall have yet another second wave correction, this one lasting a Fibonacci 3 days.
It would all look pretty good at the daily chart level then.
I may take some profit this morning and use Monday to get a better entry…. and then I don’t have to watch my position go negative again.
There are two cyan trend lines. Which one do you expect to be touched on Monday, 1900 or roughly 1925?
I am certain you have a reason as to why subminuette ii did not finish yesterday at the 1927 level. I know you said it looks like a five up for minuette A. But I am not sure why subminuette ii could not have completed.
I mean the upper cyan line, the one that slopes down, on the daily chart.
My biggest reason for expecting subminuette ii isn’t over is that upwards move looks so strongly like a five.
And for a correction a five cannot be the whole of the structure.
I’m expecting the scenario on the main hourly chart (for the bear) is pretty much the one that will play out. That Monday will see another test of that cyan line.
I plan to sell the remainder of my (small) short position as close to 1872 as possible, then re-buy if we go below it (or hopefully re-buy after a wave c bounce back up).
Is only a small position so if we blast higher before that I will have to take a little heat.
Hopefully on the final push lower now
Max frustration will be caused to me by the market staying just above 1872 into the close then gapping much lower and not looking back on Monday.
So you can probably bet the farm that is exactly what will happen.
I am staying fully positioned for the big one… this is just noise!
Ive just gone short VIXY – just small scalp position. We are so close to my invalidation that the risk is very small.
I might be buying back in short (so long VIXY) in the next few minutes! But this move down should now be done.
Probably won’t hold this VIXY short either way over the weekend, as we might ‘gap and go’ on Monday
That’s my fear too. I’m out for today with a nice small profit.
I still have FTSE so either way I’ll ride this down. I want to ride S&P down too though.
I’m betting that Monday sees another test of that cyan line, offering a better entry.
With regard to strange VIX signals, one also has to consider that an absence of proper price discovery means an absence of proper risk assessment. It could be VIX currently not reflect true level of market risk due to overall complacency. This is what happens after many years of CB conditioning…there really is something creepy about the price action recently…
Rodney
My VIX experience. Since we are in the early stages following this slight 8-13 corrective move continuing the decline and the target would be 51-55ish area on the VIX and the SPX 1500 area. The market usually has the volatility spikes towards the end of the move. So, it is my guess and experience we would only see VIX explode towards the end of this target for 5-6 days straight in towards 50-55ish area. It usually doesnt like to stay high and comes down soon after….
Very sluggish off the lows, possible bear flag on the 5 min
Vernecarty,
What is going on with VIX. I would have expected it to be up much more considering the drop today. Any thoughts?
I don’t quite trust this move down. UVXY showing steady accumulation but not behaving consistently with the onset of a third wave. I am still watching from the sidelines… (for short term trades)
At this point it’s going to take an acceleration to the downside into the close and even then I would only day-trade the move. I am wary of this market…there is remarkable divergence with NDX so the bottom could still drop out…we’ll see…third waves down should see a strong gap up open for volatility and I just don’t see it…. 🙂
I think its a B wave.
If something is off, if you don’t trust it, chances are its a B wave.
I entered another short last night and may take my profit this morning, because I don’t trust that this will make a new low today.
You all do see this big Head and Shoulder Pattern on the daily chart from August to today right?
Or am I just imagining this?
Would like comments and analysis… Thank You all.
1987 reminder…
https://www.youtube.com/watch?v=jLfjEMDJubg
Where did you find this video? I watched it over lunch… thanks it brought back some memories… mostly bad though!
I am on youtube sometimes. I have another one that is even better… Will try to track it down in my favorites.
The hourly has one HS like you pointed out and the next target is 1800.
Math imo:
2116-1800=316
1800-316=1484
You got to be in the right place in the right time!
Yes I see it. I’ve been watching and waiting for some time on that.
One can also make a case for a massive H&S back to Oct 2014. Not quite so clearly defined but present I think none the less. If correct, it would project approximately 300 points below 1812 or roughly 1500 SPX.
Yes, I see it.
The neckline is sloping down so we have a way to go before its breached and the pattern is finally confirmed.
The volume profile fits for it too; higher volume down from the head than the volume that preceded it.
Back below the trend line from the 10-15-2014 low of 1820.66. to Aug 2015 low.
1500 here we come….
1872 first. It is a must.
((B)) micro hope over. Going to build the ii subminuette. hope…
le-kha-yim
QQQ just took out 99.88 which is equivalent to the SPX low at 1872. Let’s hope SPX follows.
I am not sure how to label today’s move down to 1898 or so. Is that the end of micro (purple) wave B on the main hourly chart? If so would we now expecting micro C to go a bit above 1927?
Or perhaps we have a 1-2, i-ii, down on the 1 minute chart.
I need Olga!
We may still be in B – perhaps double zig zag with second zig zag of y now completing, though there is a slight truncation on the first zig zag so it looks suspicious.
We are still within the base channel of the move down from 1927 atm so the move still looks corrective to me so far.
I’ve added to my shorts (just in case we have nested 1,2s) but still being cautious as we might still get a thrust upwards in c as you pointed out.
That last move up yesterday that looked like a 5, might turn out to be a 3 (there was no alternation for a 5 imho).
This market is slippery as an eel.
If move up from 1872 was a 5, then this wave (if it is wave B) cannot go below that.
We are right at the base channel lower trendline right now. Would be a good place to bounce. There is also RSI divergence atm.
I think we will see one final push up. I am waiting for both round number pivots in DJI and SPX to be taken out on close for confirmation…
We’ve just slightly fallen out the base channel (red flag no 1) – market seems top heavy atm.
Certainly doesn’t seem to want to provide us any low risk entries atm, but this is what wave B’s do so I’m not getting suckered in quite yet.
A move below 1872 would clear things up a bit.
That is my hope. A move below 1872 before any substantial bounce. Thanks for commenting.
A break of 1874 in the next hour or so would get my attention…
What do you see at 1874? I can’t see anything significant until 1872.
I meant 1884, the area of this morning’s lows…
70% of the job gains in January went to minimum wage workers.
The Obama work force continues to grow…
Middle Class American Jobs continue to disappear… These are the Jobs that historically have driven economic growth in the USA and worldwide when you think about it.
The Rape of the wealth from the Baby Boom Generation of savers continues… as interest rates continue to stay low.
Obummer
Brent and WTI have just gone Red!
Let’s see if we get anymore rumours or leaks,once the $30 line goes I expect the equities to react quite strongly imo
it is a very important day today imo
Well, the jobs numbers have been reported and employers supposedly added 151K (190 est) jobs and the unemployment rate fell to 4.9%. Anybody believing that rate bears any resemblance to reality needs to have their head examined. Here’s the deal: the FED knows the bond market is going to force them to raise rates so they are being given economic cover to do so with bogus data. There was an initial dip in futures but I think it was a knee-jerk reaction to the perceived increased prospect of interest rate increases based on the 4.9% number. All smoke and mirrors imo.
Yes it is… but the Fed will raise FF Rate off of this 4.9% number.
They have to show confidence in the numbers that are put out by acting accordingly or the act everyone is putting on that things are going to be okay is over.
Personally the UP numbers are pure fiction.
I am first again , woo hoo! perhaps the jobs report will create some movement tomorrow.
LOL
Nice
I wonder. The market of late seems to be completely immune to bad economic news. The number of announced workforce reductions by various companies the last several weeks paints a dim picture indeed. The market did not seem to notice so I doubt today’s report, dismal thought it may be, will have much impact. Price discovery in the market has gone totally haywire…there has been some consistent block buying around the close the last several sessions. It seems to me that some kind of external shock is needed to jolt the market into reality…I am sure one is not too far away… 🙂
4.9% unemployment down from 5%…. Fed will continue with their plan to raise Fed Funds Rate