Tracking the upswing from March as B wave appears to best fit the big picture.
SPX has already made closing highs, but also testing potential trendline resistance.
This one is inspired by Krasi - If the March low is a wave FOUR low with the current advance as a wave FIVE - difficult to fit it in the big picture - an ending diagonal may fit. See the second set of gray labels.
MTU regarding your comment about Chart 4 March low being wave 4 low from 2009, I know where that comes from but you need to factor in that the components of the SPX DJIA has a lot of tech stks whose are running on diff time cycles which are throwing out the visual price action picture of these indexes. They are causing distortions making them unreadable a lot of the time. As result you will get tops and bottoms occurring at points you least expect them.
ReplyDeleteThe argument against it being wave 4 from 2009 is the size of the decline, particularly on other indexes like UKX DAX NYA is that it has come back 50% of 09-20 and the rel size of waves in that range in those also doesnt fit the wave scenario. See LT charts on those.
Krasi prob takes this view because he doesnt see a double wave 2 or 4 between 09 - 18 on SPX DJIA but there is a possible hidden one there in 11-12 and when you take it into account the EW count for wave 3 to 2015 makes sense.
I think the rally since March is a counter-trend wave B or ii or whatever. Almost over.
My preferred count is completed impulse in 2018 where iii/5 from MT is. After that 3-3-5 expanded flat and this looks like w-x-y/X with zig-zag lower Y to follow.
DeleteIn this case the wave from March is too short for B it should take a lot more time.
Because time is running out for the next low and if we do not see a decline bigger than 200 points... with another zig-zag what is left is diagonal. Not my favorite scenario... I still think the market will do its job:)
Thanks Krasi. The 2018 top is a logical one. The concerns surrounding that are
DeleteOne, move since then is most likely second wave correcting a 9-year wave one from 2009 low. The March low marked a 2-year correction and tested the trend line defined by Y2K-2007 peaks (in Dow). The risk of this upswing morphing into the third wave up is there,
in conjunction with
Two, NDX has moved too far away from its 2018 high.
Krasi you have lost me with some of these comments but your 3-3-5 of 18mths from Sep 2018(??) gives time for B as 7mths but sometimes it can be less so around now is possible.
DeleteMTU - which 2018 top are you referring to ?
The problem with your comment about morphing into wave 3 is that the price size of the run from 2009 and the long time frame of 9yrs to 2018 (just like 1991-2000 was 9yrs) is that runs dont exceed a certain limit because Jupiter-Saturn gyrations seems to control these moves.
Forget about NDX and tech stks - their cycle is running later that the others. Dont rely on apples to determine where oranges are. NDX has risen at its steepest angle in 2 decades since March which indicates blowoff as that angle is never maintained for long. Think of and review how long can mkt retain a steep angle because its inverse proportional to the time period.
That's part of the reason the 2018 top looks less attractive the more the market drags on. If one takes the 2018 top, the subsequent moves are likely wave TWO, which could be over at March low, hence the risk of wave THREE up. Not the best look and feel.
DeleteAfter a 9 yr advance from 2009 you need more than 1.5 - 2 years to have a wave TWO.
DeleteTopping seqs can produce this type of pattern of higher secondary waves forming an expanding triangle pattern.
that's right, that's why 2020 top is more appealing.
DeleteThen we now need 3 years min correction to do wave TWO (of a + impulse wave) from 2020 if in fact one was to form.
DeleteBut what Im saying is the true EW count end of 5 up is not necessarily the highest peak - you can get countertrend waves that exceed the the orthodox peak.
Remember that Jan-Feb 2020 is 90yrs from the 1929 peak and that may end any further bull trend (= no wave TWO of more upside) especially as there are min requirements met for 5 waves up from 1932/42, 1982 & 2009.