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Last analysis was clear: the trend is still up. A new all time high was therefore expected as most likely.

Summary: The trend is up. Trading with the trend is the safest approach for your account. Use corrections as an opportunity to join the trend. The last open gap may be used for stops at 2,473.10.

The short term target is either at 2,481 to 2,482, or next at 2,490.

New updates to this analysis are in bold.

Last monthly and weekly charts are here. Last historic analysis video is here.



S&P 500 Weekly 2017
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This wave count sees primary wave 3 as incomplete, but close to completion.

Within primary wave 3 impulse, the final wave of intermediate wave (5) is seen as incomplete. Intermediate wave (5) is subdividing as an impulse.

When intermediate wave (5) is complete, then primary wave 3 would be complete. Primary wave 4 may not move into primary wave 1 price territory below 2,111.05.

Primary wave 4 should last about 8 weeks minimum for it to have reasonable proportion with primary wave 2. It is the proportion between corrective waves which give a wave count the right look. Primary wave 4 may last 13 or even 21 weeks if it is a triangle or combination.

If price reaches the target at 2,500 and either the structure is incomplete or price keeps rising, then the next target would be the next Fibonacci ratio in the sequence between cycle waves I and V. At 2,926 cycle wave V would reach 1.618 the length of cycle wave I.


S&P 500 Daily 2017
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The daily chart shows only the structure of intermediate wave (5); this structure is an impulse.

Within intermediate wave (5), minor waves 1 through to 4 are now complete. The final fifth wave of minor wave 5 is underway. Within minor wave 5, minute wave iv may not move into minute wave i price territory below 2,430.98.

Minor wave 5 is extending. Within minor wave 5, minute waves ii and iv now both show up clearly at the daily chart level. This portion of the wave count has now the right look. It would still look right if minute wave iv continued sideways for another day to two, taking up a bit more time. However, volume still does not support this view today. Volume suggests minute wave iv is over.

Within minute wave iii, the subdivisions of minuette waves (ii) and (iv) now look clear on the daily chart.

There is perfect alternation between the deep expanded flat of minor wave 2 and the shallow double zigzag of minor wave 4.


S&P 500 hourly 2017
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Minor wave 5 may be subdividing as an impulse so far. The middle of the third wave has the strongest upwards momentum. This wave count fits so far with MACD.

Attention now turns to the structure of minute wave v, within minor wave 5, within intermediate wave (5) to end primary wave 3 in its entirety. Current upwards movement may be a fifth wave at four degrees if this wave count is correct, so some weakness should be seen.

Minute wave v looks like it is subdividing as an impulse so far. Within minute wave v, minuette waves (i) through to (iv) may be complete.

Alternation is a guideline and not a rule. There is inadequate alternation now between minuette waves (ii) and (iv): both are expanded flat corrections. But there is alternation in depth: one is deep and the other shallow. This wave count is acceptable, but the probability that it is correct is slightly reduced.

Minuette wave (iv) does not fit within an Elliott channel drawn using the first technique, so the second technique is used. Minuette wave (v) may end within the channel.

Two small target zones are now provided, both calculated at two degrees. Minuette wave (v) only needs to move beyond the end of minuette wave (iii) at 2,481.24 to avoid a truncation. It does not have to move beyond the price territory of minuette wave (iv) above 2,481.61. The lower target may have a slightly higher probability.

If price keeps going up above the first target, then use the second target.

Minuette wave (iv) may not move into minuette wave (i) price territory below 2,472.27. If price makes a new low tomorrow below this point, before another high, then use the second wave count below.


S&P 500 hourly 2017
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It is also possible that minute wave iv may not be over and may continue further sideways for another one to two days this week.

Minute wave ii was an expanded flat correction, so the least likely structure for minute wave iv would also be an expanded flat as that would offer no alternation in structure. Minute wave iv may be a triangle and still have good alternation, or a combination and still have reasonable alternation.

Both triangles and combinations are sideways movements. Lower degree Elliott wave triangles equate to pennant patterns and combinations equate to flag patterns. Both are reliable continuation patterns and should be used as opportunities to join a larger trend.

A triangle or a combination may include a new high above the start of minute wave iv at 2,477.62. Unfortunately, there is no upper invalidation point for this second hourly wave count, so no upper price point which may add confidence to the first hourly wave count.

As triangles move towards their end they often (not always) come with MACD hovering about zero or sitting flat. So far MACD is now mostly flat, offering some support now to this wave count. However, triangles also almost always come with declining volume. This is strongly not the case, so this wave count must be judged to have a lower probability than the first hourly chart.

The structure of subminuette wave c within minuette wave (b) of the possible triangle is also now problematic. Within subminuette wave c, the impulse of micro wave 3 looks like a three but should be a five.

Minute wave iv may not move into minute wave i price territory below 2,430.98.



S&P 500 weekly 2017
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Volume is bullish. On Balance Volume is very bullish.

ADX is extreme and usually at the weekly chart level this quickly leads to a pullback to last two to four weeks. During the current bull market, which began in March 2009, ADX has only reached extreme on four previous occasions. On each of those occasions it was immediately followed by two weeks of downward movement in one case and four weeks of downwards movement in the other three cases.

In all four prior cases the pullback was sufficient to bring ADX down back below the directional lines and below extreme.

This time ADX has remained extreme for 17 weeks although the ADX line has not been rising for the whole time, only fluctuating. This trend is looking very stretched, but at this stage it may be better to rely upon Elliott wave structure and other indicators to tell when the next multi week pullback may begin.


S&P 500 daily 2017
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Another new all time high now comes with a small decline in volume, but volume for the last two upwards days is still relatively heavy. This suggests upwards movement may continue a little further at least for the short term.

ATR still continues to strongly decline and is now very low indeed. Upwards movement looks weak.

A new support line is added for On Balance Volume. This line is horizontal and tested at least five, and possibly six times. A breach of this line would be a reasonable bearish signal.

Stochastics may still remain extreme for longer, and divergence may develop further into multiple divergence before a high is found and price turns. If RSI reaches into overbought as well, then a high may be closer.

Overall, the trend is clearly up and has some strength still. Corrections are still an opportunity to join the trend. However, with the Elliott wave count expecting a deep sustained pullback coming soon in the form of primary wave 4, members are strongly advised to exercise good risk management and keep stops tight. The last open gap at 2,473.10 should be a reasonable point for stops. If this gap is closed, then it would not be a breakaway gap but an exhaustion gap, and it would then be possible that a deeper pullback is underway.


VIX daily 2017
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Normally, volatility should decline as price moves higher and increase as price moves lower. This means that normally inverted VIX should move in the same direction as price.

Another signal of bearish divergence comes today. Price has made a higher high and a higher low, the definition of upwards movement. However, this has not come with a normal corresponding decline in volatility. Inverted VIX has moved lower (indicting an increase in volatility), so there may be weakness within upwards movement from price today.

With now three bearish signals in a row and no downwards movement yet, this may be a warning of a deeper pullback to come soon.


AD Line daily 2017
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With the last all time high for price, the AD line also made a new all time high. Up to the last high for price there was support from rising market breadth.

There is normally 4-6 months divergence between price and market breadth prior to a full fledged bear market. This has been so for all major bear markets within the last 90 odd years. With no divergence yet at this point, any decline in price should be expected to be a pullback within an ongoing bull market and not necessarily the start of a bear market.

There is no new divergence today between price and market breadth; the new all time high for price is matched by a new all time high for the AD line.

Lowry’s measures of internal market strength and health continue to show a healthy bull market. This week has seen a further increase in internal health of the market, so we may have some confidence that this bull market shall continue.

Historically, almost every bear market is preceded by at least 4-6 months of divergence with price and market breadth. There is no divergence at all at this time. This strongly suggests this old bull market has at least 4-6 months to continue, and very possibly longer.


The S&P500, DJIA and DJT have all made new all time highs.

Nasdaq has made a new all time high. Modified Dow Theory (adding in technology as a barometer of our modern economy) sees all indices confirming the ongoing bull market.

The following lows need to be exceeded for Dow Theory to confirm the end of the bull market and a change to a bear market:

DJIA: 17,883.56.

DJT: 7,029.41.

S&P500: 2,083.79.

Nasdaq: 5,034.41.

Charts showing each prior major swing low used for Dow Theory are here.

Published @ 10:18 p.m. EST.