Tag Archives: Elliott Wave SP500

Mini-SP500 Intraday Gyrations Upate

At this time it looks like I will have to run different wave counts in about 3 out of 5 indices. The wave counts are dramatically different with the tradeable contracts than from the indexes, which only move during the day. Futures that are traded have a wild and wooly look and feel that can distort the wave counts.  It could all smooth out a bit, which I have noticed in other future contacts as well.

This Mini SP500 contract did not travel to a new record high which I can’t use as a truncated 5th wave, but it must belong to the bigger bearish phase already.  There could be some real violent moves in both directions later this week as any Fed announcement can send markets into a dizzy spin.  I will not be happy until this market takes out all the lows of last month, but it could rest just before any downside breakout may occur.

Wave 2 in Minor degree may be finished and I’m sure I don’t need to draw out the rest of the move. By weeks end things could be different if diagonal wave structures are involved. It’s still too early to tell if a big flat or a big zigzag will dominate, but the big triangle can still be ignored at this time. We don’t have enough time before solar cycle #25 starts, for any triangle to completely play out.

I’m bearish no matter what we get, even though I may turn bullish at some counter rallies.

SP500 Intraday Rally Review

This week may be the last week, that any March contracts will be finished, after which I have to jump to June contracts with most of the indices I cover.  From Friday’s decline the markets found some joy and soared in hopes things will not be as bad as it seems. As long as the media is conducting a trade war, the chances for the markets to go down outnumber and reason that that this market should go up!

Trade war fears are not going to go away, as this kind of action has worldwide domino repercussions. 30-Day Fed Fund rates still have downside potential, which means that rate increases, are still to come during 2018.

We need the markets to clearly show lower highs, but these can happen in any 4th wave as well. This is what happened in the  2015 correction.  If another small degree wave 2 rally is in progress, then the SP500 cannot go higher than my “B” wave in Minor degree.  (Blue).  This “B” wave I’m showing is the start of a potential zigzag in intermediate degree.

This would be the start of a Cycle degree zigzag wave 4 correction, which the majority of analysts will call a “bear market”.

We can have market crashes without the bear market, as that is exactly what happened in the crash of 1987. The 87 crash was over in a few short months, but it sure will take longer in today’s markets. The 87 crash was only a Minor degree wave 3 crash, which the majority of wave analysts have used as a Primary degree crash. My 1987 crash Minor degree wave count,  is a “Full” 2 degrees lower, in what the experts have used.

These contracts that trade during the night, do produce some erroneous spikes that don’t show up, when switching this chart into line type charts.  The markets are still heading higher as I post, but we can take a bit more. We just can’t clear the “B” wave in Minor degree.

Mini SP500 Intraday Crash Update!

I’m showing a Minor degree “AB” wave with the “B” wave ending just before the end of February. This was also a full moon date and the news about the president Trumps war on cheap imports, became front blog page news.  They couldn’t find a fundamental reason why the markets should crash as all the fundamentals were still bullish.  They sure have their fundamental reasoning now!

Fundamentals are lagging indicators not leading, indicators so any bearish news would pick up the declines intensity.  This “B” wave that I labeled, would belong to a set of diagonal 5 waves down in Intermediate degree, which can only work if this Cycle degree crash turns into a zigzag. I may run this for the month of March, or until it gets trashed, whichever comes first.

The recent talk about steel and aluminum import duties that president Trump has started, has brought this to the front pages. This has all happened before folks. The Smoot-Hawley Tariff Act of June, 17, 1930 was the last time a tariff war was conducted and it was one of the main causes of the 1929 crash and 193o-1932 bear market decline. At that time the markets gyrated everytime the Tariff Act was discussed in Congress, which was well documented in the book on “How The World Works” by Jude Wanniski.

Will this all produce a “depression”? I say “no” because in order for that to happen the US dollar needs to charge up into a major bullish phase and all stocks “and” commodities would have to crash down together!  All prices must get cheaper as the US dollar would increase in purchasing power.

With Jerome Powell indicating that three rate increases are still coming this year, this combination of bad fundamental news was enough to give the kiss of death to a bull market. Sometimes I use the 30 and 90 day simple moving averages on 90 minute charts which gives you many “Death and Golden Crosses”.

With a 30-90 day setting, we can see the Death Cross happening much sooner than when we use any 50-200 day SMA. There was one Golden Cross last month, and in March we now have another Death Cross!  Of course, this all becomes unreliable if I make any changes in any of my settings. Right now the SP500 is approaching the 30 day SMA, which could produce some resistance. With a 50-200 SMA my search for Death Crosses on daily charts has been largely a futile effort.  I think if they showed up more often the mainstream analysts will notice them and report them.

Mini SP500 Intraday Gyrations Review

The SP500 is far from breaking new record highs. It is only the Nasdaq that is getting close to breaking out into new world record highs.

Just incase I have beaten the Cycle degree flat drum too long, the above chart would be the beginnings of a zigzag in Cycle degree.  The markets would have to show us another 5 waves down in Minute degree which would then end up at wave 1 in Intermediate degree.

Any top trend line is worthless to use and any invisible bottom trend line is still a bit away from getting hit.  Another Shock&Awe move would help to confirm the bigger bearish phase, but I would throw this wave count out the window in a flash, if these markets do not perform like a bearish phase should.

Dow tumbles nearly 300 points on new Fed chair’s comments | New York Post

Jerome Powell is the new man in charge and the mass of investors, listen to his every word, when they want to!  They didn’t care that much when Janet Yellen was raising rates, but now they seemed to care. If rates are not an issue just yet, then this market could still soar.

If good news no longer pushes the markets up,  then we are over on the big bearish side already. Tomorrow is the full moon and employment numbers should come out on Frida as well. These reports can send the markets into a tizzy, but other times they get completely ignored.

Mini SP500 Intraday Rally Update

The Mini SP500 created a peak and now has started to back off. This doesn’t mean the stock party is over as another small leg up can still happen.  This rally has turned right at a small bear market rally peak, creating a potential H&S pattern. No sooner had investors injected record amounts into stocks in January, and as soon as the markets dipped, they started pulling out record funds.

Stock-market tumble sends investors fleeing equity funds – MarketWatch

They will always find someone or something to blame for the intraday crash, and the VIX is a prime scapegoat. It’s never the fault of crazy investors who get themselves in a trap situation. They also start to cry that manipulation is bringing this market down. Just about anything that goes down, they will blame on market manipulation.  These guys that believe in market manipulation, figure that markets should never crash.  All trends eventually come to an end, but only a very small amount of contrarians know this fact instinctively.

Insiders are long gone out of this market and only the emotional investors remain. My method of operation, is to always build the wave counts down when stocks are pointing up, and then build the wave count going up once the bear market has shown itself to the rest of the world.

I think it is far more important to catch a major stock market low as only a very small percentage of traders can take advantage of a decline by betting short in the market.  Besides smart short players do not need any wave counts to tell them how to bet short. By late 2008 the markets already signalled that a reversal was coming. The VIX had already peaked at 90 and was about to implode.

As I post the markets are still pushing higher, so this peak so far may not hold. There are spikes that show up, but they have more to do with high speed computer algorithms than human clicks of the mouse. “Algorithms Gone Wild” is more like it. One thing that is always certain and that is, large amounts of protective sell stop orders are piling up below present prices. Eventually they will all get triggered sending the markets to a new record low.

SP500 February Meltdown Review: How’s Investing For The Long Term working For You Today?

The markets got serious this afternoon as another near vertical decent move played out. The January meltup has not turned into a February meltdown. This is a classic move with a counter rally in progress. This could be just a small rally but should produce some sideways action for a little while.   I still can’t see wave 1 in Minor degree, but I’m sure it will show up by next week or even sooner.

The VIX blasted up to just under $40 with a massive spike which must correct in time. No spikes opened on the way up so that is actually a good thing.  I may still have a small degree 4th wave rally that needs to play out, but when we do switch into a higher degree, the counter rallies will be bigger and take longer. In the first few days the markets lost about a trillion dollars and I bet this has just tripled in the last 3-4 hours of todays trading sessions.

You’re not going to find this “lost” money  in the lost and found department, because this money has disappeared in a puff of electronic smoke.

Mini SP500 Intraday Rally Update

I think our present little rally doesn’t have a very long life span as we just completed a potential expanded zigzag type of a move. Since diagonal wave structures can act about the same way, which should be ready for some hidden surprise moves as well.  In the last year or so I have developed a damn paranoia about markets, reversing and charging to new record highs. Once the entire January rally is retraced we might get a better feel if this market is already over on the bigger bearish side. It’s still better to catch a crash bottom that has turned into an “ABC” crash than not catch it at all.

I’m sure every wave analyst goes through the same situation. This is also a great reason to keep intraday wave counts at the smallest degree levels because it makes us more sensitive to the moves that are going on. We are now on the 5th day of a market meltdown, which many only think is a correction, so buying on the dips is being encouraged. Little do they know that this impending big correction will be the, ” The Mother Of All Dips”.

At every major top in 2000 and 2007, the analysts all mentioned buying on the dips, but these dips turned into Grand Canyon like gorges.

I’m looking for a Cycle degree correction and for a potential 3 waves in Primary degree I would need a specific wave count in order for the entire move to confirm itself.

I need 6 sets of 5 waves in Minor degree, 5 sets of “ABCs” in Minor degree and just one set of 5 waves in Intermediate degree.

Sure, we’ve seen all the fundamentals improve, which is expected in a big bullish price move, but 5th waves are always the weakest compared to wave 3 bullish phase of any bull market. From March 2009 the SP500 enjoyed a 430% gain, which only the true contrarians of this world can take advantage of.

The two major tops since 2000 are all wave three peaks that must be completed with a “higher” degree sequence. 2000 was an Intermediate degree wave 3 peak followed by a Primary degree, wave three peak in 2007 and now in late January,  we are faced with a wave 3 in Cycle degree. Sometime towards 2029, we could be faced with a Supercycle degree wave three peak.  Each 5 wave sequence leading up to any wave 3 peak must also be in sequence with the right degree.  The 5 waves up from the 2009 bottom were 5 waves in intermediate degree, so the next bull market must contain 5 waves up in Primary degree.

Flipping wave counts around like a line cook flips burgers is not an option. Most wave analysts refuse to go back to 1932 and start a fresh count,  as that sounds too much like work. Most wave analysts could not draw out an extended wave three because if they did, we sure would not be counting waves in SC or GSC degree.

The SP500 is resuming its downward trend as I post, so get ready for the wild ride to continue.

Mini SP500 Intraday Bearish Phase Update

We really can’t call the start of this bearish phase a crash as this isn’t deep or long enough to make a difference. As choppy as this decline is, it can come back with a vengeance at anytime. This is what’s happening as I post, so by the end of the day this wave count could be trashed. 1987 was a single crash, but 1929-1932 was not. 1929-1932 was a single crash “and” a bear market.

I will keep any updates short as I’m working through the flu as well.

Mini SP500 Vertical Spike Update.

At the rate the SP500 is soaring we will be in the stratosphere before too long.  Of course, investors will freeze to death long before this can ever happen.   The VIX hasn’t crashed, but has joined the SP500 for this rally. If the bears attack stocks again, then the VIX could keep right on going north for much longer. 

When a new vertical high is forming, I look for another potential reversal to be setting up.  A bull market correction would have its downside limit, but must establish a low, from which another leg up would have to develop.  Just incase a much bigger degree correction is lurking inside the crystal ball, all the support prices we can invent, will never hold.  

At a minimum a good sizable correction will go “off” the charts heading south not north. 

SP500 2000-2017 Intermediate and Primary Degree Review

Idealized Cycle, Supercycle And Grand Supercycle Degree Review | Elliott Wave 5.0

The above link was posted late August. It shows three sets of idealized wave counts after Cycle degree wave 3 is completed. In the SP500 chart below, we already have 2 sets of wave 3 tops with the third top in Cycle degree still in progress. 

I look at the markets from a Cycle degree perspective with wave zero of 5 waves in Cycle degree starting in 1932. Cycle degree wave 2 ended in late 1942, while Primary degree wave two ended in 1975.  Intermediate degree wave 2 followed by a bottom in 1983, and then a Minor degree wave 2 ended in 1984.

The 1987 crash was a Minor degree wave 3 crash while most analysts working on SC degree, called it a Primary degree crash. This is a full 2 degree difference from what I have. 

At the 2000 top I was a full 4 degree levels lower than what the majority of wave analysts were using. Between one single degree level, we can be out by 61%, and if we are off by 4 degree levels, we could be out 4.618 times. 

The one big 5 wave sequence that separates Cycle, SC and GSC degree, is 5 waves down in Primary degree. Since the 2000 peak not a single set of 5 waves going down in Primary degree, had developed. In fact the exact opposite happened, when all that developed were just corrections. After each correction the markets soared to new record highs again. This should have been a clue to high degree wave counters that something is wrong, but they refused to change or go back in time and work on a new wave count. 

Since 2000 we have one set of 3-4-5 waves completed, but in Intermediate degree. At the 2007 top wave 5 in Intermediate degree completed with a new wave 3 in Primary degree, on top.  From the 2009 bottom the markets churned up in a wild and choppy fashion, which most of the time would not fit into any great looking impulse. I labeled it as an impulse to keep it simple, but 5th waves can be diagonals which act like a location indicator.  

Since the 2009 bottom wave 1 and wave 3 were the two extended wave’s, so the final 5th wave up must be the shortest wave. Right now it seems the market will never end, but we are being sucked into a bull trap.  The main reason for this market top being much harder to count out is that it is a higher degree than the other two were. Any SC degree wave three top, will be harder yet to find,  because there is a natural tendency to slip into a higher degree before they are actually due.  

The Elliott Wave Principle is not about what the pattern looks like, as those are the easiest wave patterns we think we are seeing. It is the shape of the idealized pattern that tells us what to look for, as those easy waves are just traps.  Sure 5th waves extend, but they don’t extend for several generational seasons. A 5th wave extending through the Boomer, Gen X and now the Millenial generations can’t happen, as 5th waves usually have much weaker fundamentals.

With 2 sets of 4th wave bottoms under our belt a Cycle degree 4th wave bottom should be the next one in the sequence. Just like each wave three top, must increase in sequence by one degree, each 4th wave bottom must also increase by one degree increments.  

In the last 20 years I have counted the markets in GSC degree, then moved down to SC degree. This was still not low enough as I had to drop down to a Cycle degree before it started to make sense.  The lower the degree the more sensitive to the markets we become. Higher degrees do the exact opposite as the 2009 bottom clearly demonstrated. 

Without finding “All” 5 waves in Cycle degree first, it is impossible to move into any SC degree world, and even less possible to be in a GSC degree world. 

Mini SP500 Intraday Rally Update

This morning the markets continued to rally, which had started late last week and has now pushed into the previous wave two of the same degree. What looked like the start to a good looking impulse, now has to be thrown out, and then replaced with the diagonal wave counting method.

To really throw a monkey wrench into the Elliott Wave count, the SP500 could just keep right on going and then break new record highs. Any new record high is the last thing I want to see, but until this market shows that it can no longer create new record highs and start to a big bear market could be delayed again.

The VIX has also dropped like a rock, but it left a big open gap in its wake, which is very bullish for the VIX in the near term. When there is any bullish outlook with the VIX fear gage, then this is very bearish for stocks. Constantly thinking inversely between the VIX and SP500, many investors may have real problems with it. Seasoned contrarians understand this very well, and take advantage of it as much as they can.

In the long run, we want the very last high for 2017, and then fall deep enough that the market no longer has the time to recoup its losses. Other indices are still leading the charge down, so those are good signs that a bearish phase may have started. When a market turns early we can then use it as a leading indicator as others would soon follow.

Any single isolated top will help keep everything separated, as double and triple tops makes it far more difficult to find the start of a new countdown.

Mini SP500 Crash Review:

Now that investors think that stocks are not the place to be, the stock markets are starting to rally again. It would be real nice to see if this opening shot has any staying power. A rally seems to be underway, and at the same time the VIX seems to be on a mini decline as well. 

A fairly well formed 5 wave sequence seems to the logical pattern unfolding, but diagonals in a diagonal world can react very violently to the point where the present rally comes right back well into my present wave 2 in Micro degree.  In other words, we could have just finished an “ABC1” count and we get a 60-70% rally. 

That sure would throw all those pretty Fibonacci retracement ratios into disarray.  Any 4th wave rally will have a limited life span,  and I usually look for the previous dip and rally to see how far a 4th wave can travel to.  There is not that much I can add today, but the VIX may offer some more insight.  

SP500 Supercycle Review

I spent more than 10  years, counting wave structures in Grand Supercycle degree (GSC), then I moved down the degree stack and counted everything in Supercycle (SC) degree for a few years. I even started another blog just dedicated to SC degree wave counts. When I saw that the majority of expert wave analysts missed an 8 year bull market, I knew that SC and GSC degree wave counting had major flaws in it and that it must be thrown out. 

This flaw is the lack of understanding that wave 3 is always the longest wave in the general stock markets. 5th waves do extend, but they are rare and usually involve the last degree before a top. In the 1900’s I believe that the markets developed a Cycle degree diagonal 5th wave, ending with the peak in 1929. 

I don’t think a multi generational 5th wave extension can even happen, as 5th waves are generally the weakest as well. Yet every expert wave analyst counts with extended 5th waves. Those that count from a 4th wave base, will always move into a higher degree level long before it is supposed to arrive.

I will be talking about Supercycle degree (SC) from time to time, as technically the general stock markets, are still in an extended wave three in SC, and GSC degree. SC degree wave 3 has not completed anywhere, and it may not arrive until the 2029 time period. The Elliott Wave Principle is not about flipping pretty numbers and letters around, as any kid can do that. It’s all about how we visualize the idealized wave structure. Each time we label a position on paper or in our computers, we are also technically travelling in time. To time travel, I like to go back 100 years, and then look forward 100 years. Four generational seasons make up a 100 year cycle, and most economic cycles repeat themselves in 100 years. 

The short story is by “Ignoring history, we are doomed to repeat it” which is especially true in the financial markets.

Below is a chart of the SP500, which does not update that frequently, but it gives us a good long term picture from the 1929 top.

All the super bearish forecasts that will be mentioned in the future are irrelevant, if we think we are in some mythical SC or GSC degree world already. From my perspective, we are a minimum of 2 degrees lower due to the fact that wave 3s have never been extended. At times at the 2000 peak, my wave counts were about 4 degree levels lower. 

Readers must understand that I see the EWP as just one big ” Idealized impulse” wave structure, and that these wave structures are extended wave 3s not extended 5th waves. The peak in 1929 and the 1932 bottom is my wave 1-2  in SC degree, and not a wave 3-4!  Just being out by 1 degree can throw any forecast off by a minimum of 60%. (1.618) 

The same problem shows up in the 1960-1975 bear market, which the majority assumes is the location of Cycle degree wave 3 and 4.  To recap, the majority use a 4th wave base from the 1932 bottom and then another Cycle degree 4th wave base in 1975.

Labeling 1932 and 1975 as 4th wave bases would give us about an 85 year long SC degree 5th wave extension so far. That’s almost three generational seasons long, for a 5th wave extension?  Technically, this cannot happen, yet the majority of wave analysts all count from a wave 4 base.

 It’s also the main reason why experts missed the biggest bull market since the depression. (2009 -2017). How many expert wave analysts posted any wave count that was extremely bullish in 2009? No wave analysts that I was reading at that time could say with great confidence, that a multi year bull market in stocks was coming.

As long as the wave analysts believe that SC and GSC degree, are here already, then wave followers will continually  miss major bull markets. This happens because they have never gone back in history and looked for alternatives.  Going back 100 years and starting fresh, is too much like work, so until they want to do the work, the same setup that happened at the 2008-2009 bottom will happen again at the 2020-2021 time period.

The start of any new solar cycles are bear market terminators, as they will trash all bearish wave counts and related moods. The studies of the sun and the real impact on the stock market is not rocket science folks, as many have made the same connections.  


The link above is just one link to a solar cycle study.


Mini SP500 Intraday Record High Gyrations Update

The SP500 is down just a bit from the last record high of 2480. There is a 50/50 chance that one more attempt at a moon shot could happen, so I don’t want to be too bearish in the short term.  Long term this market is going down, but crying “crash” and the markets keep going higher gets pretty tiresome after a few months or more.   Since the 2009 bottom the markets have been in a diagonal 5th wave in Primary degree, heading towards a Cycle degree wave 3 top.

This huge bullish phase would now be 2 degree levels higher than the 200o peak, of Intermediate degree.  Many in the mainstream media are calling for a correction in the markets and I agree with them. The trick is knowing approximately how deep this so called anticipated correction can go. Any 70% crash sure would be a bigger dip than the majority expect.

When they do realize this then fear could really kick into overdrive. I couldn’t give you an exact bottom as well, but this market will flash oversold conditions long before the SP500 will ever hit the real bottom.  Once the stock bear market is completing its bearish phase, then we should get a 5 or 8 year bull market, as solar cycle #25 will be the real driving force behind the next bull market.

Any 20% correction would just work like a little bee sting, as we need the majority to be very bearish on stocks before any true bottom arrives. The end of any Cycle degree 4th wave may take until 2021 to play out as it will definitely not happen overnight, or as fast as the 2008-2009 bear market.

Either way I’m sure that we will hear all sorts of SC or GSC degree forecasts, calling for the SP500 to fall to 400! My analysis says it will never get there, and if the SP500 clears that 666 bottom level I will be pleasantly surprised.

Mini SP500 Intraday Record High Review

Another SP500 record high was recorded this morning and is now starting to correct. This market must be hitting the record books as there has been nothing but new record highs created over such a long time period. Sure, it would be nice for this market to send us a signal that this bullish phase has finished, but that has been wishful thinking in the short term. 

Until this market starts to head down, so there will always be the chance it can strike out to a new record high.

For starters the SP500 would have to drop below 2400, but it would have to travel much lower before this market becomes oversold again. That won’t happen until all the stock market bearish news dominates the mainstream media again. Even then the counter rally could be a fake, and fake bull markets will always retrace the price point where the fake bull market started from.   I have never seen an inverted zigzag not retrace itself, unless it was a triangle, and even then after 2 tries, it would succeed in retracing the zigzag tops. (Waves A&D)  

The choppy waves give us a clue, as this diagonal wave can happen in any 5th wave. Extensions can throw a monkey wrench into any wave count when we believe that extensions must be in a higher degree! It is the exact opposite, as extensions bring out the smaller degree levels, not the higher degree levels. This is one of the main reasons I start counting with very small degree levels, which can always be adjusted at a later stage in an extension.

All my work is taken from a Cycle degree perspective, but it doesn’t mean that a SC degree peak is not in our future. This may not happen until 2029 with GSC degree wave 3 being closer to 2129.  Many are predicting the end of the world by then and any Grand Supercycle degree end to humanity forecasts would fit perfectly.

There seems to be an urgent need to cool our planet down and when they succeed you will be freezing your ass off as the world sits in another Little Ice Age.

Mini SP500 Intraday Record High Review

The markets have seen another impressive run for most of July, with the SP500 topping to another record high. Early yesterday the Mini SP500 reached 2476 before it turned down again for the rest of the day. One move has ended and another move looks like it has started. Two main things can happen next, one is that another correction of the ongoing bull market has started, or that a big bullish phase has ended. 

Now if this start of the decline survives the day, then this would be a good thing. In the end, for a bigger bearish move to have started, we need to see these markets head much lower. I’m not going to go wild in calling this an expanded top due to the fact, that there are  just too many zigzags. Besides, not until any “C” wave decline has nearly finished will we know.  

A potential Cycle degree wave 3 is still my favorite choice, but only time will help to confirm that. It’s also time to take another Gold/SP500 ratio calculation, and as of this morning it takes 1.98 gold ounces to buy one unit of the SP500. When the SP500 becomes cheap again, this ratio could be closer to  .75 of a Troy ounce. Not until the entire planet is bearish on US stocks, will this ratio give us better readings. 

As I post, the SP500 is heading up again, but we want to see the top price of today hold.

Mini SP500 Intraday Record High Review

The markets have been hitting new record highs on a consistent basis.  In the last day or so the SP500 created another record high, consisting of choppy waves that can only fit into a diagonal type of a wave. We are dealing with very small waves from a degree perspective which I show as a Minuette degree. The markets could be fooling us with what may be an expanded pattern, and it’s the main reason for showing a “B” wave in Intermediate degree 

The potential of an inverted zigzag traveling to new record highs, is pretty common with diagonal wave structures. The fact that “any” inverted zigzag can retrace 100% of its entire move, is one of the best indicators of future direction that the EWP can give us. Needless to say, they are very important from my perspective. 

When we count everything by only seeing impulse waves, we rarely will spot expanded wave tops. 

Will this market break and set another new record high? It sure can, and in the next few days this may get cleared up. I have already looked at the Apple chart as an expanded pattern, and I may find more in the coming weeks.  We have to find a real top that is followed by a 5 wave declining pattern. This real top is not defined just yet, as a new shot to record highs can still happen very quickly. 

The VIX is also rolling around a big 23 year triple bottom at the 9.50 price level, so that indicates that fear can strike the complacent investors at any time. 

Short term we are still getting bullish action, but longer term this insane market is going down. If all the contrarian indicators are being ignored, like they usually do, then many of the investors will see that that the fingers will be pointing at them as being the “greatest fool”. 

Remember, as the market rises, all protective sell stops start to pile up below present prices, so any wild bearish news can start to trigger the majority of  these sell stops.  Besides, I think there are specialist that just love to trigger any stops at all.  


SP500 E-Mini Day Chart Expanded Flat Review

For the last several months I was working this market bullish phase as an Intermediate degree diagonal 5th wave. It all makes sense, but we also have an extra bump that might not belong, or I have an issue with it.  This happens many times, forcing me to look for a potential alternate wave pattern.

I love to see any expanded flat before it happens, but many times we also have to wait until we are very close to completing the “B” wave before we can see it.  It may sound silly, but we have to see the pattern first, before we can count it out, as wave counting is a secondary act, to confirm what you think we are seeing. Of course, if we constantly ignore expanded patterns it throws our wave counts off by a mile, and we will end up with temporary bottoms that can be far too shallow.

I consider any expanded wave very important due to the forecasting ability that is built in. Every simple wave pattern in the EWP, contains forecasting abilities, but as usual they are all degree specific. 

Any expanded pattern I use would push any Cycle degree wave three back to the 2015 top, making the 2016 to present rally another three wave affair, which I labeled as a flat. (3-3-5)   The expanded flat would be an Intermediate degree “B” wave, but it would also stop falling at a potential “A” wave in Primary degree.   This may not happen until the SP500 falls below 1800 or even more. 

In the end, we want all the stock bears coming out of hiding, shouting bearish slogans to mark the arrival of the bear market.   Of course, as soon as they recognize that a bearish trend has started, it will turn and soar the opposite way. It may sound funny, but the markets have been fooling the participants like this for eons.  

One recent big example of this was back in late 2008, when the majority were all bearish on stocks. Even all the expert wave analysts had extremely bearish wave counts, right along with the opinion of the majority. (Wave 1 in Primary Degree)  Nobody saw the massive bull market coming except for all the stock insiders and a few smart contrarians like Steven Jon Kaplan.

A failure to recognize a bull market before it happens, is a failure of any wave count that we may be working on at the time.  Yet nobody has taken advantage of this, by looking back in history to rectify the situation.

If we think we are floating around a SC or GSC degree top, and we are off, then we have to go back in history, and create another new wave count with new locations. Going back 100-200 years on chart sounds too much like work, and therefore has never been done consistently. The EWP has turned into a short term trade setup tool, where they don’t have to go back to the Roaring 20s and recount 1929-1932. 

This wave count may not last very long, but the only way to eliminate any wave count, is to run it and see how soon it will fail.

Any “C” wave that crashes from an expanded  “B” wave top can produce a very steep decline, even to the point where waves are next to impossible to see.  In this case we would need 5 waves down in Minor degree. 

As long as there is the potential for the markets to crash, the USD can keep on crashing as well. We can end up with investors seeking refuge in gold and gold stocks pushing them back into a bullish phase. 

Mini SP500 Intraday Record High Review

This E-Mini SP500 is so close to breaking new records, that it still has a good chance of breaking through by the end of the day. I have a small zigzag trying to push through, which would be part of a bigger 5 wave diagonal move.  What might not be so obvious, is that oil seems to be fluctuating up and down with the SP500 at these intraday price levels. It’s not very consistent, as we can also get stock declines when oil does nothing.  I will discuss this scenario with my contrarian friend, but it would have to do it on a much bigger scale, if there is any basis for  real concern. 

I think this correlation is a short term thing, and can smooth out or even disappear altogether.  I don’t notice this pattern standing out on any of the other indices, so this is also a good sign it may not keep doing it. 

It’s always good to take a Gold/SP500 calculation, when we see extremes, and this morning it took exactly 2 gold  Troy ounces, to buy one unit of the SP500.  I recorded this 2:1 ratio in December 2016 as well, but I have to do some more back checking to see what the ratio was when the SP500 was cheap. In November 2016  it only took, .75 ounces to buy one unit of the SP500.  

When gold is pointing down, and stocks are pointing up, then this is usually a setup for a reversal. I’m sure we will run into this scenario again in the future, and even now gold could soar, while stocks take a beating.  

As I post this SP500 is soaring  to new highs, so it may back off when we get closer to the end of the day.

Mini SP500 Rally Review

Since the June top  the markets have declined with wild moves in both directions. It is pretty hard to see a real trend, which can also just be part of a small correction belonging to the bullish phase. If the bullish phase is still going to happen then a new record high would have to be established to confirm it.   As it sits I can still work it as a diagonal wave structure, but I’m also reaching the limits of how far this SP500 can go. 

At one peak this morning we had about 5 points to spare, so this wave count can still be destroyed in a very short time. For this market to confirm a bearish rally, it would eventually have to drop well below the 2402 price level, after which another diagonal wave 1 would follow. This would be a one degree higher wave 1 in Minute degree. 

These choppy patterns will start to smooth out due to alternation, but can go deep as 5th waves can decline far more than any trend line might suggest.

Right now a small decline is in progress, but we have to see if further downside is going to happen later this week. 

Mini SP500 Intraday Gyrations Review

We have some very ugly waves that have formed, from the June 19th top. A 4th wave can still be in progress, but it also could be  the start of a diagonal decline.   There may be one more Micro degree 5th wave this week, and it could stop with another small double top.  When we draw a trend line from this June top, then the 2436 price level could supply the SP500 with resistance.  The maximum of this diagonal 4th wave would be around the 2444  price level.   This tight range does not give us any room to wiggle around, but it also supplies the pointer to a potential wave 1-2, which is extremely important. 

One thing about diagonal 4th waves, is that they  “must not”, exceed the wave 2 spike I’m showing.  Many times they stop in the middle of wave 2, and then they reverse, and soar the opposite way.  Oil has  been going up and down in sympathy with the SP500, but oil has also moved ignoring, the SP500. As I post the SP500 and oil are still soaring together.

 Short term I would like to see the SP500 move higher, but after that it will be a crap shoot, if the markets soar to new record highs or not. 

Many mainstream  media news shows that the majority are also conflicted in the future trend of the markets.  It can all smooth out some when another “C” wave follows any potential B3 wave as that would be very common. Diagonals do not look that much different than what a correction will do, so transforming to a choppy decline can make us think that just another bull market correction is in progress.  

E-Mini SP500 Intraday Rally Review

I’ve made a few changes in the wave count, after the SP500 landed were close to my last bottom. Due to the positive jobs report that comes out on the First Friday of every month the markets soared. This good  fundamental news trapped all the bears, triggering the protective buy stop orders in the process.  If this means anything, then technically, the SP500 should keep right on soaring to new record highs.  The full moon is on Saturday, so even that can make stocks very bullish.

Our last extreme high was back in mid June as it crossed to new records,  with a 3 wave pattern. This is a typical diagonal wave structure that I love to see.  Since the June top, which could be the start of a bear market, the market has made one crazy decline that was so choppy, that it can work as just another correction.

The market is still charging up as I post, but if this rally has no teeth, then another new low would happen. Any new lows, will prove that the markets don’t care about any fundamentals.

Any decline has started  with diagonal wave structures, as it is next to impossible to fine great impulse waves, except for runs of very small degree levels.  A new low must be reached if the bigger bearish phase has already kicked in.  The violent swings are typical when a market changes its direction and the best we can do is to wait until a newer low gets confirmed.

The DJIA and the Nasdaq had also seen their extreme highs, but with tops at different times.  The best we can hope for is that we don’t end up with multiple tops.  It would be nice if we can see a clear price peak structure that  we can start our count from, but that sure can be wishful thinking on my part. 

When the markets don’t make new highs continuously, then all those emotional traders will see they are no longer making gains, and buyers will stay away, or existing bulls will be eager to sell.

Insiders have long sold out with this May being a very heavy month for insider selling. 


E-Mini SP500 Intraday Review

This intraday chart is done with line type settings, which can produce a different set of waves than bar type. This entire pattern still can be a correction, but then the SP500 would have to charge to a new record high.  Diagonals can produce such wild patterns and even seem like it is still in a correction, so the markets still need to make lower highs, to help confirm we are over on the bearish side already. 

This market can still backfire and surprise us, so until all alternate wave counts are reduced or eliminated we have to keep our options open. Many of the indices I cover have also managed to stay on the bearish side, so this does help to make the bearish case. The decline is 5 diagonal waves in Minuette degree, which would work for any larger zigzag decline. 

Short term we may still get bullish moves, but longer term this market is going down, and the only big question that always remains, is what type of a pattern the bear market will produce. Any market correction can only produce one of three simple types, and my favorite pick is still some type of a flat.

Wave three in Cycle degree can eventually produce a complex expanded top, but if that even has a slim chance of developing, my bet is that any expanded top, would be a “B” wave in Primary degree and not a “B” wave in Intermediate degree.  I don’t think there is enough time before 2021 to include a Primary degree expanded top.  I have been making it pretty clear, that there is a very strong probability,  that any major market crash bottom could stop short, of crossing past 2009 lows.  Any ultimate decline should produce between a 60% and 80% decline, but a new record low will not trash my Cycle degree decline.

Many indicators will tell us that markets will be oversold long before the wave count will hit bottom, yet the public will spew bearish opinions at a constant basis.  In the end opinions mean nothing, as contrary indicators will supply more evidence and facts, than what any opinion ever can.  

Mini SP500 Intraday Crash And Rally Review: Will The Crash Continue?

The wild swings we have been getting are far from over. To stay on the bullish side this market has to perform and break to new highs, even if it breaks record highs by a very slim margin.  Yes, the counter rally we are getting can count as an inverted zigzag, but we can get fooled, because diagonal waves start out pretty much the exact same way. 

It is critically important to keep an eye on the June top as this is where the count starts from at this time.  The VIX also shot straight up as the market crashed, but the VIX has already crashed in a dramatic fashion. It will remain to be seen if the VIX works its way to another new record low. As sharp as the decline was, I have to keep  the bullish and the bearish wave counts active, at the same time, until at least another new record low is produced. 

The next few weeks will be important, but this market has to decide either way, if this market is a bear disguised as a bull, or a bull acting like a bear to lure us into complacency.  About 2 weeks ago the SP500 soared to new highs with a 3 wave pattern, which can’t be counted as a 5 wave impulse, but yet the majority of expert wave analysis ignore this little known fact. 

Presently we are stuck between a rock and a hard place, while this market decides what it wants to do.  Any Cycle degree wave 3 top does not have a fixed home, as we need to wait if yesterdays crash low, will hold. 

In general, I do not post on any US or Canadian holidays, but I do occasionally break those rules.  

E-Mini SP500 Gyrations Review

Yesterday, the SP500 hit a crash bottom, and then reversed its direction and charge right back up where it once came from. This was a little too far for my liking, so I looked at my daily chart to find the peak, to the start of what could be a triangle.  I’m sure you know about the potential “Thrust” the 5th wave could make.

What is different is that we are in a much bigger diagonal, where the 5th wave itself can be another zigzag. Another zigzag to new record highs would then happen. The first zigzag sure looks like a flat, but the “D” wave could not be a better formed zigzag, pushing the SP500 to new record highs. 

If we look at the triangle as a whole, we can see that each zigzag in one direction, was completely retraced by a zigzag in the opposite direction.  Following the potential “D”wave top, the markets plunged into what looks like another zigzag crash, which I labelled as an “E” wave. 

This “E” wave has not been completely retraced, and I think it should still happen, as we were only 10 points or so away, from breaking a new record high this morning.  If the bulls are still in control, then the top trend line will not hold, as this present correction should find a bottom, and then reverse.  This mornings plunge was very steep, further making the case for a correction. 

Even if  this chart heads to a new low, we could also be in a “D” wave, as the entire triangle could be one wave too early.  I would love to see this as a triangle, because it can give us more certainty, that a much bigger correction is still to come.  

The new baseline is at the 2412 price level, which can get breached, but still soar back with a vengeance.  The SP500 is now getting close to breaking support, so we have to see what happens during the rest of the day.

E-Mini SP500 Intraday Bull Attack Update

In a blink of an eye the SP500 drops like a rock, then soared this morning, and is still going as I post. There is a good chance that this market is already over on the bigger bearish side, and we should get another “lower high” to confirm it.   

Since I have a Micro degree wave 2 top, at the 2447 price level, then this rally cannot go past that point.  It’s the pattern that’s  important,  and any wave 2 top cannot be exceeded. It can retrace up to 99.9999%,  but not 100%. 

Active investors or emotional day traders move the markets, because the average Joe is too busy drinking beer and having barbecues.  Being an average investor does not work. They may be up on paper during a bull market, but in a big bearish phase, that paper becomes worthless.

 In short the markets have to keep making lower highs, but that idea will not work if another 4th wave was still in progress. Lower lows, and lower highs, sure didn’t work in the 2015 bear market and it will not work now. 

E-Mini SP500 Intraday Crash Review With VIX Commentary

Keeping an eye on the VIX helps to confirm that fear is being injected back into the stock markets. So far all bottom open gaps,  have been closed off. Also, no gaps have opened for the start of this VIX rally, which also is a very good sign.  At least the threat of an instant VIX crash is reduced, but corrections can happen after every vertical move. 

The big VIX, is the ” Mother Of All Diagonal wave structures”, so any VIX wave counts, will overlap in many of the critical waves.

 I reworked the entire May and June rally to the 19th of June peak as diagonal “C” wave. This has  ended with another 3 wave move to record highs.  This record finished with a 2452 price peak,  and is now hell bent on going south like geese in the winter.



That’s what it looks like, but I would like to see more, so there is no hope for this stock market to add on another leg to another record high.


I have mentioned it many times that any new record high could also be the last record high, but that would also be the last high for this year. At the 2415 price level  the SP500 would hit the line in the sand, but this bottom could be more like quicksand. Wild counter rallies should always be expected, as the speculators are still in a bear trap. 

It is very important to understand that any 3 wave move to new highs can be just part of a bigger diagonal or even an ending triangle. Even though I came close to exhausting my wave count options, there is sill a wild card left of another potential big 3 wave move to the upside.  The odds of that happening would be reduced as soon as the SP500 slips well below that 2415 price level.

Mini SP500 Intraday Update

Last week the SP500 started to build a base and then started to soar. Last night the Sp500 carried on and now has peaked as I post.  Sure, I would like to see this rally come to a screeching halt, as it also has gone vertical on a smaller scale. A vertical move is a very fast move, which usually happens before an impending correction, or on the ends before any major reversals. There are errant spikes that do not show up when we  switch to line mode, but this seems to happen across many futures contracts. 

Just as fast as the SP500 has gone up, it can reverse and head straight back down, leaving the little spike in its wake.  Our mid June peak, has to hold as any start to a bear market has to produce lower highs as well.  Lower highs are produced by inverted flats and zigzags, which is the exact opposite of what happens in a bull market. 

All this stock market has to do is retrace this rally and crash below this quadruple base we see now.   This will help to confirm that a bigger bearish move, is already happening.  

On a very small scale, oil and the SP500 can crash together, which it is doing right now. The media will spin this in different ways, but in the longer run, they could separate and go their own merry way again. 

E-Mini SP500 Bullish Record Top Review

The SP500 started to turn late last night and has now made a pretty good decline. It is starting to dip into a potential previous wave one peak, but I would like to see a bit deeper into my “A” wave position before a potential diagonal 4th wave can still happen.

At this time the rally to new record highs crossed as a 3 wave pattern and not as a 5 wave pattern. Three wave bull markets are a clear indicator that a diagonal wave structure is in progress.  Now we have to watch and wait to see if this major top will hold.

One of these days the Cycle degree wave 3 will find a permanent home that will last for the next 100 year. Visualizing the idealized extended impulse that we must know how to draw out, is the key to in knowing what to look for. My wave counts are a minimum of two degrees lower, than what the majority of expert wave analysts, are presently using. Why this is so, is because the majority all work from a 4th wave base, (extended 5th waves) while I gave up on that idea in 2013.

The 5th waves are never that strong to extend from the 1932 bottom to our present top in 2017. Not only that, the majority of expert wave analysts see, dual large degree 5th wave extensions. Another 5th wave extension started after the 70’s bear market. Wow, two 5th wave extension in 85 years?  That kind of a setup may work on another planet, but they will never work on earth.

The only time we had a 5th wave extension was from 1987 to 2000, which was only in Minor degree. Many run the 1987 crash as a Primary wave 3-4 degree pattern, which again is a minimum of  two higher degrees than what I see it as.

We are faced with a potential Cycle degree 4th wave stock bear market, which is just a correction to an even bigger bull market to finish. Any 20% bear market correction means nothing, and any price bottom will not hold except on a temporary basis.

SP500 Intraday New Record High Review

With all my index wave counts, we have now switched to the September contracts as there are no more June contracts left. There are only 4 contracts in the entire year, so a jump to September is very normal.  The markets, including this SP500 chart have gone wild, with mad emotional swings in both directions. 

The wild swings are signs that this market is unstable, but we know they can carry on like this much longer than we have the patience for.  From the 15th bottom the SP500 has now crossed to new record highs with a 3 wave pattern.  This could be part of a potential ending diagonal as well. The Russell 2000 also had basically the same pattern at the top, which helps to make the case that another correction is due, or the end of a big bull market can finally happen. 

Short term we are running low on the intraday possibilities, so any move down would give us more options to choose from.

These markets are pointing to a potential wave 3 peak in Cycle degree, and I have been building a potential bear market for some time already. Bull market tops are the breeding grounds for bear markets. Visualizing the idealized chart for the next 100 years will give us the wave counts needed to fulfill all the wave 3 extensions still to come. We are nowhere near SC degree wave 3 yet, as SC degree wave 3 must also extend. The wave “zero” start to SC degree wave 3, was in 1932 

 Any wave 3 peak in SC degree is still over a decade away, with any GSC degree top stretching closer to being another 89 to 100 years away. As time goes on,  my language will include SC degree commentary more often as I try to build a picture of what is to come.

Of course if I missed something big, any other pattern could still happen, but like I said options are starting to dwindle. Building a potential big wave count, is also helpful to detect mistakes as early as possible.