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Category Archives: INDICES

Russell 2000 New Record High Review.

This is the June contract daily chart and it is the main reason why it does not fill out. I started with the weekly chart and it seems the entire 5th wave in Intermediate degree is a diagonal with this part being a zigzag traveling to new record highs.  Apple is just completing the exact same type of zigzag which tends to be the finish of a diagonal 5 wave run.

I did check it again from the 2015 bottom, which is best done with the weekly chart. Many may  start counting this as potential new leg up, but if that is the case then another two, 1-2 wave structures would have to form.  The VIX is also apporaching record lows again so a big bullish move in the Russell 2000 is highly unlikely this time.

When a market goes vertical, it’s always a good time for a correction, or it can mean the end of a big bullish phase.

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NASDAQ Intraday Review

The Nasdaq had a very different time period for a major peak which was hidden or masked by the bearish attention to the DOW and SP500.   Any Nasdaq wave count is not clear at this point as we still have too many wild gyrations. Summer is coming on which can produce very bearish moves. We do have to respect the Nasdaq as it can keep on giving us the gears in the short term.

From late April the Nasdaq has now only produced a 3 wave run, as wave 4 is still missing from this action. I switched to line type chart but it also changes the wave patterns, producing different wave counts all the time. In the short term I will be doing some cosmetic wave counting, but eventually the trend will start to smooth out, and when it heads south it will help to confirm a bigger bearish phase is in effect. Recent Commercial trader report does not show an extreme bearish situation, but more of a small bullish situation. This could turn more bullish as the real decline shows it’s true colors.

It makes no sense to spend so much time in intraday scale as for long periods of time nothing can happen. Nobody can take advange of intraday scale wave counts. It might take a week before a new posting is read 4-5 times, by that time it’s to late to take advantage of it.  The big and best moves happen at the daily and weekly chart scales when the majority are all “forced”  to switch directions.

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SP500 Intraday Bullish Phase Update

So far this phase of the stock market has done nothing by soar in one direction and then move right back down again. Investors are having difficulty in finding a lasting trend. From the April low we could still be in a diagonal ‘C” wave rally. From the April peak, the SP500 crashed again but added a 3 wave zigzag move to a lower low.  This little 3 wave structure doesn’t fit unless it is part of an expanded pattern. If that is the case then this market could crash to the May lows, after which another shocking rally could soar past the March high.

I would have little room to spare if the next move happens, but final ending diagonal 5th waves can produce moves that will surprise many of us. There is nothing here that indicates that a bull market correction is already over. Any Cycle degree correction needs much more time and depth, before a new bull market will be ready to be unleashed.

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Euro Intraday Bearish Phase Update.

I was expecting a counter rally and we were not disappointed as soon after the Euro turned south one more time. If another violent reversal happens then I may have to change this 4th wave count. What matters is if the Euro was in a big fake bull market fooling all the experts in the process.  It sure can be as I have many other currencies in the same positions.  Gold needs the Euro to turn very bullish and that sure does not look like it’s going to happen. This recent dip in the Euro was matched with a dip in the gold price. From my perspective the Euro/Gold relationship is still working.

The commercials were also short the Euro,  so until that situation makes a dramatic change, I will remain bearish towards the Euro. The US dollar also spike higher this morning, so all three are acting their parts perfectly.  These are only three asset class relationships I’m talking about, as our Canadian dollar and the Australian dollar are showing the same patterns.  Many experts have forecasted for the Euro to soar, but by the looks of it the Euro is refusing to cooperate. Telling the difference between a real big bull market still to come or a fake bull market is the key, as the smartest market readers are also being fooled.  A new big bullish phase in the Euro will happen, but at this time it sure looks like the next big bullish phase will also be a fake.

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Mini DJIA Intraday Bull Run Takes A Break!

Running with the bulls can wear you out, so the bulls are taking a bit of down time as they run in the opposite direction. The question is how far south will the run? The May run sure looks like an impulse to run as 5 waves have completed.   Short term we are still faced with violent moves in both directions, blowing us a lot of smoke to keep any real trend hidden. Eventually the smoke will clear as violent moves (volatility) is very normal when a major change in trend is in progress.  We have a wedge forming as well, so the bottom base of  23,400 has been hit 4-5 times.

We know that “sell” stops are all piling up below this price level, so when that fails the bulls might just capitulate in the short term.  The DJIA is starting to look more like the SP500, but short term any run like this can just correct and resume its charge back up.  I think the short term 24.300 price level will tell us more as that is where I would expect another turning to occur. This may take all week to clear up. Today is the new moon day and many times this can produce strong reversals.  I just don’t see crude oil heading north as the DJIA heads south. In 2008 everything crashed together, oil, gold & silver, gold stocks and all the other indices around the world.  11 years later we are faced with the same setup, but also with many asset classes being at different stages in  any crash.

Gold and oil also made some major moves this morning so I will cover that today as well. I will keep most of my intraday chart analysis between Tuesdays and Fridays as I have to keep my attention on the big trends first.  Any wave analyst can produce you all sorts of numbers and letters giving you short term trade setups.  Short term trade setups mean nothing, if we miss the biggest bear or any of the big bull markets.  The reason short term day traders are everywhere, is because they have no clue what the big trend is that we may be in.

Like Jim Rogers says, ” A big bear market is coming” and it could take a lot of other asset classes with it.

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E-Mini SP500 Intraday Update: With the VIX And Jim Rogers “Extreme Bear Market Coming”

Jim Rogers: Extreme Bear Market Coming

Jim Rogers comes from Market Wizard fame. When he speaks it is a good thing to read what he has to say about the coming bear market in the next few years.



This VIX index has been heading down and is approaching the start of a very violent spike. The spikes show up worse in this index than the actual June contract.  The top parallel lines roughly show where the Intermediate degree stock market bottoms finished at.  We still have a potential $9-$10 price range where the VIX can turn. Sooner as bottoms tend to come in with a “Flash”.  I would hate to see the VIX index hit another new record low, but I still look for a potential reversal as when it happens it can happen rather quickly.

 

As the VIX implodes stocks start a bullish phase, which I think is coming close to an end as the VIX can’t go to “zero”.  I will be doing some “Cosmetic” wave counting. Eventually all trends end so it will erase all those patched up wave counts in a flash. We have different wave patterns between stock markets and this is just one of them. Eventually, when any  new trend is more obvious, as waves may even smooth out a bit. We would have to get a very obvious 4th wave to show up before this run is finished, so many things can go wrong.

This bear market is going to be “More Extreme” which stands to reason, if we look at it from a Cycle degree perspective. 2002 was an Intermediate degree bottom with a small recession. The 2008 bottom was much worse than 2002, recession as it was one degree deeper. The next bigger degree bottom will be a Cycle degree bottom so it should be worse that than what it was in 2008-2009. The markets love to fool the majority all the time and the markets  may not even go lower than that 2009 bottom.  Even if they did go lower, all it would mean is we have a missed extension somewhere in our wave positions.

Contrarians will be buying long before the real bottom arrives as stocks will already be oversold before the real bottom even arrives.  Of course the real bottom at the end the next bear market will arrive when all the experts have declared that a recession is here and it’s going to get much worse. All bearish consensus will be in agreement with the parrots all singing the same tune. At his time the market will refuse to cooperate and start on a bullish phase that will not stop for another 8 years!  It all may take until 2021 as we need the power of solar cycle #25 to push markets up and away.

Commercial traders are very bearish by any stretch of the imagination, which can act like a brick wall stopping the markets march to higher highs.

Overall, I remain bearish on the stock markets until such a time we clearly see that a good correction has taken place.

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Nasdaq Intraday Bullish Review

The Nasdaq has been on a wild bullish phase the seems to have no end. Since the April bottom any impulse pattern we did have fell apart rather quickly. The Nasdaq may be getting ready to correct.and it can overlap right down to the bottom trend line.  I have many different wave counts in 5 of the stock markets I cover and it will take time to sort out.  A three wave rally is just starting to complete and it’s when I would suspect a correction, or even an ending.

The Cycle degree wave 3 position I do have, may still get evicted. At this time I’m not happy with any of my short term wave counts as it will take some time to sort out.  When all support (4 spikes) going back to February breaks down then we may have a better pattern to work with.

I’m not going to spend too much time on this as there still are too many alternates I can come up with.  I never try and post 2-3 alternates in one chart as I try to work one of them at a time. It’s always a process of elimination one wave count after another, which takes time to play out or fail.

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Mini SP500 Intraday Gyrations Review

The gyrations continue as this market is having difficulty in making up its mind in which direction it wants to go. Right now the markets see no gloom and doom as the VIX resumes its downward march.  I had this wave count once before, but now I will bring it back even if it is just temporary. It’s a diagonal 5 wave run, which is not finished yet, but a correction is due. We are near  to completing a small 5 wave run, leading into an “A” wave peak.

In the short term bullish action would have us believe that the bull market is still on.  I could be as some of these patterns are starting to fit into an ending diagonal.  So for the short term, there are still too many different options which have to be reduced or eliminated.  Sure fundamental news gets reported but that is a 24/7 on going event.  There is no way we can pick out all the different fundamental news stories, that made the SP500 go up and then fall just as fast. Fundamentals in the world, is just “white noise” like us older folks used to get from B&W TV stations before they went off air. It’s the volume of the white noise that is important, not the specific noise. Even the DJIA is getting close to looking like the SP500, while the Russell 2000 and the Midcaps are battling for a potential triple top.

This could  drag on until the end of the month, but if it breaks, and it’s a bearish dip, then no short term price support will hold.

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Russell 2000 Daily Chart: Cycle Degree Review

In the big stock markets, contracts run every three months and not monthly as many other contracts do.  This is the unminipulated daily chart which only shows more when I use weekly chart settings. If I switched to line type, then it also changes the wave pattern dramatically. I created a big expanded count, which is pushing it,  because it should still clear the secondary peak, but not travel to new record highs. This is starting to look like a triple top setup which normally makes it a real challenge to figure what peak still belongs to the bullish phase, or the bearish phase.  We have a very narrow window for this count to get trashed as a true diagonal “C” wave seems to be unfolding.  The fast drop of the top is also a sign of an “A” wave decline, but then the following “C” wave should show more subdivisions. This would produce a very long “C” wave in Intermediate degree, but it would also land on the “B” wave in Primary degree that we need, to correct a Cycle degree wave 3 top.

Yes, it could still take a long time before this clears up, but that is the nature of the beast that we have to deal with. At a minimum the Russell 2000 should still fall to the 950 price level, which could also supply price support for a short period of time. All those that recommend in buying on the “dips” have no clue as to the size of the correction,  that a Cycle degree wave 3 peak can produce.

Bear markets come in 2-3 different flavors,  with single crashes that do not produce a bear market, like 1987 and even 2008. Then there are the bear markets that produce a crash (1929) followed by a bullish phase, but then the “C” wave can be a long drawn out bear market, like we had from 1930 to 1932.

I’m sure we will see a “C” wave bearish decline yet, but it would also be a signal that the end will be near. I try to be very clear on what the market have to do to stay in the rules, as this helps in finding out if we are wrong at the earliest stages of the game. The last thing I want is to drag around a bad wave count for 30 or more years.  A Cycle degree correction must subdivide down to 3 degree levels of Primary, Intermediate and Minor degree levels to get confirmed. With intraday charts we would run into Minute degree waves as well, but on weekly charts they may not show up very well at all.

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S&P Midcap E-Mini Update

The trend line in this index was on the verge of being cut, but so far has managed to stay above this bottom trend line. I would love to see this go a little higher, at least to the “A”wave double top.  I mentioned it before that this could be a diagonal “C” wave and this index so far is coming very close to it.

The Russell 2000 is also about the same, but it may end up with a triple top.  This market has been fooling around long enough for my liking, but this could work as a high “AB” wave in Intermediate degree. A very long tail would have to develop which technically I have no problem with, but I would not like to see this zigzag travel to new record highs.  In order to help confirm that we are over into the bearish phase, is for the Midcaps to fall well below my “A”wave low at the 1760 price level.

At this rate, we’ll be back into another  ice age before a suitable correction has played out! 🙄

No new record highs have been recorded since late January 2018 and a 2000 price level, so investors are not going to be happy if the markets don’t start producing better returns.  Traders have been brainwashed to move up protective sell stops, which are not “Buy on The Dip” orders.  The “dip”may be much bigger than anyone is even dreaming about as I believe a Cycle degree correction is coming, and no little 3 month bearish price action will correct a Cycle degree wave 3 peak.

At the very minimum, the 1200 price level must get breached, which could just turn into a warm-up stage for the rest of the bear market still to come.

I’ve dedicated the rest of my life to finding, following and confirming all 5 waves in Cycle degree, but not a single wave analyst has come forward in the last two years telling me that they want to track the same degree level. Some just love the idea of a Supercycle degree crash, but we are not even close to that high degree level, until the 5th wave in Cycle degree arrives. Beware of “any” 5th wave that is left uncapped anywhere on the internet, because they are breaking a major rule when the 5th wave is left uncapped!

I have more than enough different asset classes I track, so I will reduce any intraday posts between Saturday and Monday, as I concentrate on the bigger picture and more commodities and their related ETFs.

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Mini DJIA Intraday Chart Update.

My Intraday market reports are going to slow down a bit. There is no sense for me to post intraday charts on the weekends including Mondays. During that 3 day time span I will keep my updates to Daily, Weekly and Monthly chart analysis only.  It is impossible to constantly post intraday charts when there has not been sufficient time for the wave pattern to play out. My concern is always the bigger picture which is Primary, Intermediate and Minor degree levels.

I will no longer use more than three colors to separate degree levels as 3 will do for anything we are going to use in a Cycle degree world.

In over 3 months the DJIA still has a downward bias that is very hard to ignore. The bulls are ignoring it as they are looking to buy on the “Dips”. Any analyst that calls for support is bullish in a bearish world which at this time still is the majority. “Value” hunters are having problems in finding opportunities which stands to reason when the markets have been at world record highs for 9 years!

As I post there was still upside left, that still could slice through my top trend line. All the bearish market moves so far, do not indicate that there has been a strong enough bottom to justify another huge leg up in some mythical moon shot still to come. Think of Cycle degree as the Mount Everest peak, SC degree as the moon, and last but not to be forgotten GSC degree, would be Mars!  🙄

At this rate it could take a long time before we know what pattern we are going to get first in a Primary degree bear market. For a flat the opening could just be a zigzag in Intermediate degree which would land on the “A” wave in the Primary degree than I’m after. I will try different wave counts without notice, as using a different wave count we are posting it for elimination!  In a few years time these intraday chart moves will blend back into the woodwork and you will never see them again.  All charts I post are filed on my home hard drive, and is also automatically backed up with a Time Machine setup, so I can go back and take second looks on most intraday charts.

So far it looks like a diagonal decline, but they can smooth out like gold stocks eventually did, so for the short term we could miss a few surprise counter rallies. Most of the time it’s just stops that are getting hit. Every trader has been brainwashed into using stops, so the sell orders are piling up below present prices.  I have three different patterns to work with so until they smooth out a bit some “Cosmetic Wave Counting” will be necessary. Eventually “all” cosmetic wave positions will be doomed.  Cosmetic wave counting is all about those experts that never have gone back in history, to double check the structural integrity of the wave counts.

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Mini SP500 Gyrations Review

The short term trend seems to be down as lower highs are still the main theme. I will stick to my wave 2 top in Minor degree at this time with this bearish mood now in its 4th month. Four months without any gains must be testing the patience of investors as they think this market is still going to the moon. The stock bulls are going to get slaughtered, so prepare your fridge for some fattened bull steaks, as the bears are sharpening their claws and will slice and dice every bull they attack! Nice bunch of bears we got here, as they will show no mercy until all the stock bulls shut up!

At least the January peak is still out in the open which helps as this is where the countdown begins. What a Cycle degree 4th wave correction will look like, is uncertain at this time, but a recent KOL posting has shown us a big inverted zigzag which can happen with the DOW. I favor a Cycle degree flat, but this count puts the “A” wave in Intermediate degree down and into the future.

I will be doing a bit of cosmetic wave counting, as in the beginning of any trend can be very fuzzy. Sooner or later the new trend will show itself to a greater crowd and that is when mini panics take place. The bigger the crowd the bigger the panics will be. A straight down crash like 1987 is unlikely as now there are limits to many of these contracts, which is supposed to limit the damage that can happen.

Increased volatility is a sign that a trend reversal is in play, so the volatility will not die down until any bearish trend reverses, and the bulls take back control.  I have at least 3 different stock indices patterns to deal with so this takes time to sort out. “Cosmetic” wave counting only last for a short time, but wave counters have been practicing “Cosmetic” wave counting for decades. They have been getting away with it, because very few people understand the EWP!

No doubt about it, I was a cosmetic counter as I was stuck in GSC degree which was very unsatisfactory work. The amount of bull markets that have been missed by professional wave analysts is staggering, but luckily people have short attention spans and cosmetic wave counting will continue to flourish. I’m a “structural’  wave analysts, which means I always go “back” in time to make sure the beginning structure is correct. Going back to 1929 and going over the entire Cycle degree impulse many thousands of times is too much like hard work. It gave me much needed discipline in my wave counting and I will always keep doing it when Minor degree waves don’t act like they are supposed to.   The hunt for the “missing” 1-2 Primary degree wave count, has largely been ignored, but it is the key that unlocks the wave counts in the present.

At this time I have recorded about 27 wave three Cycle degree peaks which nobody on the internet is even doing. Technically, if all my work was moved up by only “one” degree,  I would have 27 Supercycle degree wave 3 peaks. Since 2000 not a single wave structure of SC degree has ever formed, as very specific sequences “must”  form in order to be past any Supercycle degree wave 3 peak. Many idealized SC and GSC degree patterns have already been posted years ago, but they will be collecting electronic dust until at least 2029!

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DJIA Intraday Plunge Update!

All calls for one more blast to the upside are starting to evaporate faster than ice dumped on hot pavement as we are approaching a downside breakout situation. For now in looking at a potential Minute degree diagonal pattern which can smooth out as more and more people become bearish on stocks. Retracing the entire April rally will happen if my bigger bearish scenario is in effect.  Pretty words and fundamental jargon will not stop a bear market once the peak has completed. This is my third big bear market I’m working, but still each bear market will be different than the other two bear markets. I will keep my updates a bit shorter than normal for a few days, but I dedicated my time and effort to map all 5 waves in Cycle degree, and at best we are only at a Cycle degree wave 3 peak. My preliminary Cycle degree wave three peak count, is about 16 this week. Some are still a bit fuzzy but they will clear up in time. If I’m still short a Cycle degree peak, then I will count out a fringe asset class like cotton!  Working on 16 Cycle degree wave three peaks are more than what you will find anywhere on the Internet, bar none.

Ask yourself, “How many other expert wave analysts have even found one wave 3 in Cycle degree”? Not a single wave 3 peak in SC or GSC degree has ever been confirmed since the 2000 peaks.  If you think you see a good SC or GSC peak anywhere on the internet today, then I will find a sequential problem pretty quickly. Any SC degree bear market needs a very specific wave count to get confirmed as there are always three sets of simple corrections we have to deal with.

Our 5 wave bull market must be sorted out to what degree it is in,  as this is critical to determine where we are in the bigger picture. There can be no room for alternate discussions as being out by just “one” higher degree or one lower degree will fail.

Short term, things can always go sideways or swing wildly in both directions as that is the sign that a trend change is taking place.

At this time I have several different bearish wave counts between my 5 core indices, but they could also clear up or smooth out some in the coming years.

This May I’ll be starting my third year with this blog and last month saw the highest pageviews I have ever had! Over 71,000 pages were viewed in one month, which puts this blog on track for a million pages viewed by the end of 2018. Needless to say I’m impressed by those numbers and every single visitor deserves an extra big, “Thank You” from me.

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E-Mini S&P MidCap 400 Index Review

I have different wave peaks and patterns between the 5 indices I cover and this S&P MidCap index is one of them. This chart only moves during the trading day and it can also give us a different perspective if we’re looking for them.  This rally still looks like it can fit into a diagonal 5 wave sequence, and it might not be finished as it is at a 4th wave bottom on Friday. This is a short term case scenario only, and since I have 5 waves down, from the January 24th peak, this market should not push to new record highs.

I have given you all sorts of  bearish scenarios  in idealized fashion, but this one would be a bit more complex, if the “A” wave in intermediate degree has already bottomed. Don’t let the small size fool you as this high “B” wave can produce very long tails with massive extensions.

The decline from mid March counts out as 7 waves. A 7 wave decline, can always be a correction and if that is true, then this S&P MidCap should exceed the “A” wave top in Minor degree.  If this is going to happen then the markets should push much higher in the next few weeks to come.

If I’m wrong, then the present bottom trend line will not hold the bears back, as they will rip that trend line to shreds if fear overwhelms them.

You can ignore any gaps on this chart as this index seems to be full of them, but I will watch a few of the big gaps to see if they have  an impact. There is an open gap near the top, so if this index turns there, then that might impress me.

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Nasdaq 100 Index Daily Chart Review

This is the index chart for the Nasdaq, which does not trade during any night sessions but can also supply and alternate point of view. I’m showing that the Nasdaq has an expanded zigzag which I said might never happen, but I can’t ignore it at this time. This morning the Nasdaq created a spike to the upside so this may be critical to see if the Nasdaq still moves much higher. The Nasdaq is one index that refuses to march to the same band, so until I can completely kill this expanded top, I have to run this sequence for now.  I have three indices that conflict with each other as well.  Yes, we can get a trend line with lower highs showing, but that could be just a short term peak.

Longer term which could last into the fall of 2018, we should end up with 5 waves down in Minor degree, not Intermediate degree.  This would all bottom at the Primary degree  “A” wave.  The final low, should end up with 5 waves down in Intermediate degree, of which the 5th wave must be capped. Every 5th wave “Must” be capped at all degree levels. If I see any uncapped 5th wave anywhere on the internet, then I know they are just guessing or worse, they are “Baffling us with Bullshit” (BUWBS). You can laugh, but you need to have a sick sense of humor to go against the two mainstream wave counting groups.

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Mini DJIA Intraday Gyrations Review

Next month we will be starting out the 4th month of this so called correction.  Many are still calling to buy on the dips because this market is going to the moon. Oh Really? We’ve heard all that before.   All those that have the “Buy on The Dip” mentality have no clue how big the “Big Dip” will actually be.

The bulls are all looking for a support price which also tells me that they have little understanding about how big the dip will be. There is only one dip I want to see and that is the “dip” that starts a new bull market.  Another 8 year bull market to be exact.  The way this bear market has started, still leaves too many wave patterns unanswered.   Sure, we also have a declining trend line, but the test will be if that top down trend line will hold. We may need all of May before we find out, because so far the market is doing a good job in fooling most of the wave analysts.

Elliott Wave analysts travel in herds just like any real world animals do. Three main groups come to mind. The Supercycle degree herd and then the Grand Supercycle degree herd. Of course  the most popular wave counting group is the GSC degree group, which are very easy to identify. Both groups do leave many of their 5th waves “Uncapped”. Any uncapped 5th wave sends a clear signal to the readers that they have no clue where they really are with no concept of Wave 1-2, 1-2, base counting.  Every, 5th wave we will ever run into, in the future must be capped, by “one” higher degree. Otherwise the wave count is incomplete and the Elliott Wave sequence is broken. In my Cycle degree world you can’t leave a single 5th wave uncapped, ever!

I plan on posting a page that will explain the 1- 2 wave, base counting. I have gone back to 1500 CE,  (Little Ice Age) and have labelled 7 “sets” of 1-2 wave bottoms already. 1500 CE is my base for the Submillennium Degree wave 2 position.

In the short term this market could keep going sideways, and the next thing you know, we will be at a “B” wave top in Intermediate degree!  If that happened then, the “B” wave top paints a picture of the rest of the bear market.  We are at a critical point as all support must crumble, if the bigger bearish trend is already in effect!

There are still too many options at this stage of the game, but I have confidence that it can get it sorted out, as the starting waves to many bear markets, can always be very fuzzy.

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SP500 Intraday Bearish Outlook.

My ending diagonal may not happen as the markets still have downside pressure today. I did change my degree level to an intermediate degree “B” wave top. Any decline has to be 5 waves in Minor degree, not Minute degree.  I have multiple different tops between 5 different indices and sorting them out will take time. This is my third bear market since the 2000 peak and I’m very stubborn in sorting out tops.  We need a long set of 5 waves in Minor degree, which could  land us directly on the “A” wave in Primary degree.  If this wave count has more validity to it, then it can stretch and extend dramatically. It sure would help to answer the question what type of a correction Cycle degree wave 4 will have. I think I can still put any Cycle degree triangle pattern back into my inventory as any Cycle degree correction should happen in much less time

If this continues, then all support below this chart will not hold.

We will be finishing the third month of this bearish phase and that is not nearly enough time to finish a big correction. We could be heading into the summer  where the winds start blowing from the NW  much stronger flipping our little “sailboats” upside down.

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E-Mini SP500 Intraday Catching A Falling Knife?

The markets had an exciting afternoon, as it seems the bottom fell out! Don’t let that fool you because that drop has all the markings of a zigzag correction. I deliberately left all other wave counts bare until after this wave count fails. Folks, I’m showing what could be a diagonal 4th wave zigzag crash, and we could see a rocking bullish phase return.  It is clearly an ending diagonal at this time because wave 4 is well inside wave two parameters. Wave 2 and wave 4 zigzags look identical, but they are still very different as wave 4 subdivides much better.

With a potential rising wedge which is mostly used for bull markets. If we look to the start of the top wedge line, what the hell do we see?  Another H&S that helped to determine a top. If the market is still bullish then this top trend line could get lifted. Exceeding March highs would be nice, but the SP500 should not push to new record highs.

This diagonal which is in Minute degree also changes the entire degree I have been using since the wave 3 top. I mentioned that this market was in a pattern with not very smooth flowing moves. Plus, it was taking  too long to resume the bigger decline, so this impending little bear trap will answer more of my questions. I have run into many of these types of diagonals and they sure will not be the last that we will run into.

The more this market gyrates the more conflicting fundamentals we will read about. This will confuse the majority and we end up having no clue which direction this market is going.  This could all happen in a very short time ending close to the end of the month or early May.

If this decline clears below my wave 2, then this wave count is instantly trashed

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Mini DJIA Intraday Crash Review

The DJIA has finally succumbed to bearish pressure, but we could still see a violent counter rally at any time. The DJIA must trash all support price levels that you see on the chart above, if the decline is more serious than what the investing bulls thinks it is. This DJIA chart I am cheating a bit in that I’m also working it as a potential diagonal decline. This may smooth out once any decline starts to get recognized, but this is still too early to tell.

In the afternoon the DJIA dropped close to 700 points which is a pretty good vertical drop. Sure, we can draw a wedge from the bottom up and if this is as bearish as I think it will be that bottom invisible wedge line will not hold.  We do have 3 lower high peaks in this developing trend, and that indicates a bearish phase in progress.  I don’t want to abuse wedges and trend lines as they can be extremely biased most of the time. The DJIA saw its peak way back in January of 2o18 which may be the top for 2018 as well. Sooner or later investors will lose patience and when a group sees the same thing at the same time we get mini panic sell offs, like today.

At the top I have 3 sets of 5 waves that have terminated which “must” be stacked from the smallest to the largest, which in this case is Cycle degree wave 3.

My strict rule is that no 5th wave peak should be left uncapped, “EVER” because an uncapped 5th wave clearly tells me an analyst is just guessing or bluffing.

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Nasdaq Intraday Decline Update

The Nasdaq hit a major peak in March before it decided to crash again. I have conflicting tops between the Nasdaq and the other 4 major indices that I cover, but I think the Nasdaq top is the real deal, and the top is a good place to start a bearish count down from. Notice that I have a small H&S pattern already completed, and if we are still in the bullish phase, the Nasdaq will  lift the right side of the invisible horizontal line dramatically. I will still keep the present decline as a Minute degree declining 5 wave sequence,but will adjust later on if my degree level is too low.

If the bearish scenario is true, then all popular support levels will get trashed.  Those that are talking about buying the dips don’t realize how big, “The Big Dip” will get.  At a bare minimum the Nasdaq will retrace the 4000  price level, which also puts the Nasdaq into the previous 4th wave of one lesser degree.

One lesser degree in a Cycle degree correction is a Primary degree, not the Intermediate degree bottom at the 4000 price level.  We have a long way to go with many twists and turns, but sooner or later the fog will clear and the basic shape of 3 simple corrections will take place. The triangle is my last choice as the solar cycle #25 will not allow it to fully play out. When solar cycle #25 starts to crank up, then all stock bears and bearish wave counts will get terminated.

Sure the bottom may still be three years away (2021) and the investors at that bottom will be the ones that have lots of dry gunpowder ready. (Cash)

Buying low at a market bottom is rarely done by the average investor, as they will be wiped during the “Big Dip” decline.

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SP500 Intraday Gyrations Update.

Since the January top it looks like a nice 5 wave decline, but it has not been flowing as nicely as I expect, from a 5 wave decline in Minor degree.  The DOW and the Nasdaq have both created wave peaks that just do not fit into the bigger picture very well. I did go back to the 2016 peak where the wave 1-2 in Minor degree sits, so instead of a Cycle degree peak it could be a Minor degree peak. The bottom trend line from wave two, can now fit with the bottom in early April.  Right now the markets are in a decline and it will be critical to see if it turns again and creates yet another higher high.

Any 5th wave can form a diagonal wave pattern so this could get very choppy in the short term.  Any new record lows will kill this wave count, but I have to run this wave count to eliminate it.  We are in a decline, but the SP500 could turn into a correction, and a mini bear trap.  Any dip below the diagonal wave 2, would also kill this bullish wave count, so many things can go wrong in a short period of time.

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Crude Oil Daily Chart And The $100 Forecast!

When I read the news that the $100 price forecast was back on, then chances are good that, it will never happen. At the 2016 bottom the media saw no bull market coming, but they sure can see it now! Back then they were calling for $20 and even $10 oil, yet the market did the exact opposite and started to soar.

This is the June contract in line type settings, which eliminates most erroneous spikes and shows no gaps.  This morning oil topped just short of $70 and has now started to back off as I post.  I’m not bullish on oil at all, even though oil broke out of the top trend line. The flat line shows the potential of two H&S patterns starting to develop around this $70 price level. $70 is a very boring number as I love the rounded Fibonacci numbers much more, where $89 has a much better ring to it!  Even $89 is a pipe dream right now,  because the entire crude oil bull market could be just a big bear market rally.  To confirm that, then nothing short of  complete retracement of this oil bull will happen. It may take two years to decline, but the bullish move from the 2017 bottom was a very choppy diagonal.

Oil may still give us a hard time, but this morning the Gold/Oil ratio, compressed down to 19.38:1. This happens just before a major reversal like it did back at the 2014 peak, when the ratio touched 17:1.  When oil becomes cheap, then this ratio will start to widen again. Something much wider than the narrow 21:1 average range we’ve had for the last 3 months.

There is a huge Falling Wedge (Cycle Degree) in crude oil and others, which on the bigger scale forecasts another huge oil bull move will come, but it may take a few years just to get to a bottom. The power for oil to crash like in 2008 is always there, and if you hate volatility then you shouldn’t be in a long position anymore.

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Nasdaq Intraday Bullish Phase Update!

When markets go up the expert analysts turn bullish, and when the markets are heading down then they turn bearish. No matter what the direction they will find you a reason explaining why. The Nasdaq contains the biggest elephants in the room which suggests very large companies. I think elephants are pretty small compared to some of these “FANG” stocks which are more the size of the biggest T-Rex!  In January of 2018, all the indices recorded world record highs, never matched in financial history. This bull market top calls for a correction that nobody expects, with some analyst getting suspicious as to the staying power of this bull market.

The Nasdaq bearish phase has only started more than a month ago, so in order to help confirm a major bear market is coming, all major markets have to crash to new record  lows again.  Price is only important to the majority, but from an EWP perspective pattern is far more important. Yes, I use price projections as well, but you will see no prices posted in my charts.

Another little pop is still possible, but the declining pattern will be important to see that it contains no corrective moves. A grinding summer bearish phase would suit me fine, but only time will prove that true.

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DJIA Intraday Bullish Progress Update

As of this morning the Mini DJIA seems to be in a small correction. The VIX also reacted with a huge spike to the upside, which tells me it takes little to spook this herd of DJIA bullish traders.  From my “B” wave bottom, the DJIA has travelled a choppy path which indicates I should be looking at diagonal wave structures.   I can draw a nice wedge as well, just by adding the top trend line, but we have to be careful not to see imaginary wedges hiding behind every move.

Since it’s only midweek, another small move to the upside could still happen, but in the end, this present rally still looks like a bearish rally.  To confirm this move the markets must resume their downward path and completely retrace the entire April bullish phase. Usually there is a much better flow to any 5 wave sequence, but this can smooth out over time. I do have different wave count tops like the Nasdaq does, so I have to look at a potential expanded top, which should be one degree higher. In other words, the “B” wave top in Intermediate degree is already in. The late 2007 peak can count out as an expanded top as well with the same degree level.

Many analysts are very bullish on stocks, forecasting that the next leg up is just around the corner. Since 2000 it has been my experience that markets never do what consensus forecasts are always telling us. ( At the extremes)  Basing forecasts on fundamentals never work, because they are lagging indicators, not leading indicators. In the case of the DJIA it was close to a 8-9 year lag as the best fundamentals were at the January, 2018 peak.

Where were all these bullish experts when the DJIA was at 6500? We know history proved the majority wrong in late 2008 or early 2009. Some analysts are so young that they have no recollection of the 2008 crash, so it is pretty hard to find an analyst that is a contrarian in the mass media today.

I can’t see this market being bullish all summer long as a bearish move into the fall has happened many times before.

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Mini SP500 2000-2018 Review: Buying The Dips?

When intraday gyrations seem a bit foggy, then it is always a good time to review the big picture, looking at where we came from, and then where we are heading to.  Analysts are becoming frothy again as they say this market has turned and all new record highs are coming. The crashing of the VIX confirms it as they say that bigger bullish moves are ahead of us.

We can go back a relatively short time period to the 2000 peak where the majority were also very bullish but yet the markets imploded, just like they did again in the 2008 crash. Now those crashes were dips as well, but the majority were sellers, not buyers at the previous two lowest dips.

The majority of experts have no clue how deep the next bottom will dip down to, so those investors and their clients are going to go down with the ship because they refuse to ignore financial history.

I show two stages for the next decline with the SP500 1800 price level being a potential resting spot before a downside breakout happens.  The general guideline for the depths of bear market retracements is near the bottom of the previous 4th wave of one lesser degree. If we have no clue what our 2018 peak actually is, then any previous 4th wave forecast is pretty meaningless. I have mentioned it a few times already, and that is “NO” 5th wave peak must be left “uncapped”, otherwise they have broken the wave sequence and we might as well be playing Snakes & Ladders!  BTW, in January, 2018 we have 2 ending 5th waves yet I left one uncapped. After a Primary degree 5th wave has peaked, then a Cycle degree number must find a permanent home.

The SP500 won’t even get close to the top of the previous 4th wave until it crashes through the 1600 price level, while SP500 700-800 would get us near the lows of the previous 4th wave of one lesser degree. The 4th wave crash in Cycle degree is the real important dip as that is the only dip that will send the markets into another major bull market.  Flipping big wave counts around like a person flips burgers, is not my style as counted like that for over 15 years.

If you are looking for some SC or GSC degree wave count your not going to get it at Elliott Wave 5.0 as from my perspective, both of those degree levels are  still 11-12 years in the future. Don’t get me wrong, as we are still in SC degree wave 3, and still on GSC degree wave 3 as well. Both will never arrive if all 5 waves in Cycle degree are not found and confirmed.

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DJIA “Big Dip” Update!

So far the DJIA has procrastinated in following through with any decline, and the fact I have an extra lower high also makes me suspicious as where the market is going in the short term. Long term I remain bearish as, “The Big Dip” I talk about is yet to come. Reading about how some investors are buying on the ‘Dips”, I start to shake my head and say, “What Dip”?   Buying on the dips in the worlds biggest financial stock market bubble in history would be a mistake if we have no clue as to the size of the real dip to come.  A Minor degree dip in a Cycle degree world is nothing if the DOW still has to fall below 16,000 or 8000!

I have mentioned that when you see “any” wave count where an expert or hobby wave analysts leaves the 5th wave peak without a “Cap”, then any wave count following this 5th wave, is just guess work.

This “Cap” must always be one degree higher, and leaving off this cap, sends a clear signal to me, that the wave analysts have broken the Elliott Wave sequence, and therefore they are making shit up. (Cosmetic Wave Counting)

Not capping a 5th wave break’s every rule in Elliott Wave counting, because once you see an uncapped 5th wave, then any wave count that follows is worthless information for us. If there was a bounty on any uncapped 5th wave you can find anywhere on the Internet, then  you would become a very rich bounty hunter!

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Is Nasdaq Friday 13th Bad Luck?

End of the week, new moon, Friday 13th and a rising wedge doesn’t help in reinforcing a bullish outlook. This week the markets struggled trying to make headway and the rising wedge shows it.  This may only be a Minute degree wedge, but there are Cycle degree wedges as well.  When a falling Wedge develops, then this can turn into a very bullish reversal. Of course, if we abuse these wedges, then they lose their importance and meaning. Most of the Wedges are bear market related so any Cycle degree wave 3 top to a Cycle degree wave 4 bottom would be a Cycle degree Wedge. Just about every crash in history showed one type of a wedge. The 1937 to 1942 Cycle degree wedge is a prime example what large degree wedges can do.

The initial rally that started last week can be counted as a wave 1 but this is also a typical “A” wave move in zigzags. So far the high peak could contain an expanded flat so I will have to flip back and forth between two patterns until the bigger pattern becomes more clear. As rough as some patterns are when starting out, they do have a tendency to clear up after a while.

When the markets have crossed the line from a bull market to a “huge” bearish phase traders have to change all their thinking instantly. Obviously we are far from that situation as market bulls have just called a market correction bottom. Just goes to show that the majority of experts still think they are on the bullish side of this market.

In a bear market good news no longer pushes the markets to new record highs, the opposite happens at the end of a bearish move when bearish market news no longer pushes markets lower. With small counter rallies, this is much harder to detect, but if we are not looking then it makes little difference, as we would be in another bear trap.

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Is The Mini SP500 Going To The Moon?

I did have a very bullish wave count all done, where we are in a “C” wave bullish phase that would take out this 2810 peak above my wave 2 in Minor degree, if that becomes the case, then the wave 2 would just move over to the new peak and then the real wave 3 in Minor degree should get going.  We are bouncing of a strong double bottom, so eventually that bottom will get retraced when the downside breakout happens.  Right now 2680 could offer very stiff resistance, combine that with a potential inverted Megaphone, and we have the makings of another potential bull trap.  This would be a wave 2 top in Minute degree. By this Saturday we will have a new moon so any attempt in getting there may have serious problems.  🙄

This may drag on into next week, but US Tax Day is April, 17th which also could wreck havoc in the markets. If you haven’t noticed, many of the top tech companies are having problems all at the same time.  Markets don’t stop on a dime, so when the trend does start to change, volatility starts to explode.

I have not seen so many crybabies about volatility in 2000 or even 2007 as I have seen in this 2018 year, so I expect all to get worse.  Buying on the dips in a big bear market will become deadly, but investors have been brainwashed to do that. It’s the big dip like the SP500 at 750 which will become important and if and when it gets there, all those dip buyers will be sellers as they run for the hills.

There will be clues when the markets get oversold, but they will not show up until a few months ahead of any major bottom.

For any Cycle degree 4th wave correction to end, we have to look at the previous 4th wave of one lesser degree, which would be Primary degree.  I see three price stages where this bear market can go and the first stage is for a complete retracement to the 1800 price level. Only until below SP500 1600, will the markets enter the top of a 4th wave correction. It usually takes into the lower part of the previous 4th wave of one lesser degree before a bottom arrives.

Either way another week or so should show which trend is for real. At this time I’m still after 5 waves down in Minor degree. Even when we get to any “A” wave in Intermediate degree, any counter rally could be very mundane and even short lived. We could run into a bear market that will be hard to see clear Primary degree counter rallies, which is exactly what happen in the GSC degree decline down into 1842. There may not be a panic until the majority of participants all see the same thing at the same time.

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Mini DJIA Intraday Rally Update

The DJIA is on a different wave count due to the secondary peak being much lower than a potential wave 2 in Minor degree.  To call this secondary peak a running pattern is also pushing it, at least for the short term. Running, flats, triangles and running zigzags do happen, and they happen more frequently than most would expect. I don’t believe in calling something a “Truncation” (shortened pattern), when so many running patterns do occur. I’m working a Minute degree 5 waves down with a potential 4th wave peak still to play out. Any 5th wave decline could fall and stretch very deep and shock investors as the reality of a bear market starts to sink in.

Many investors have never experienced a major bear market so a deep 60-70% correction is unthinkable. First, they called for a 10% correction, then they were calling for a 40% correction with the latest call I read about was a 60% correction. (Fibonacci .618). Ok, when this happens then what? Is a 60% correction deep enough for a Cycle degree correction to complete?  At this time I doubt it very much. History has given us many bear markets, with the GSC degree wave 2 decline only lasting about 8 years. The SC degree crash from 1929-1932 only took 3 years to play out.  Cycle degree wave 2 took 5 years, and Primary degree wave 2 took another 5 years ending in 1974-75. I don’t see a Cycle degree correction (bear market) take longer than 3 years.

There are no fixed time lengths for any degree as we also have seen a 20 year Primary degree bear market in gold as well.  I love the Fibonacci sequence for turning times with 2021 being a full 89 years for the next potential bottom.  Even 1929 to 2018 is already 89 years long. The reason I focus on 2021 is because of a silent force when one solar cycle ends and another solar cycle starts. Solar cycle starts  will terminate all your bearish thoughts as another 8 year bull market should develop once solar cycle #25 kicks in.

The DJIA peak of 26,600 may be the high of 2018, and when investors realized their gains are pathetic or in the red and losing money, they will hit the sell button before they click the “Buy” button.

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Mini Nasdaq Intraday Bullish Phase update.

The Nasdaq has been marching to a different drummer again,  and in the last 5-6 trading days the Nasdaq has been in a bullish phase. I would love to see the Nasdaq break out a bit higher and as I post it seems to be doing that. Any of these inverted zigzags can turn into a running pattern, which many may call a “Truncation”. There are lots of examples out where zigzags are cut short, but I will call them a running pattern before I call any “Truncation”. There will be constant adjusting that I will be doing until the bigger trend becomes more clear. The Nasdaq peaked last month and if the bigger trend is in place, then that peak of the Nasdaq will be the high price point of 2018.(7200) No more record highs for a very long time.

In a bull market, we get consistently higher lows which are Elliott Wave, 3 wave patterns. This process works in reverse as well as a bear market will produce consistent lower lows and lower highs.  Since the March peak that is exactly what the Nasdaq and others have been doing. Jawboning a bear market back into a bull market will not work, except on a short term basis. Once this present rally starts to wear thin, then we should see all the markets make new lows again.

Many are complaining about how volatile the markets have been, as they have never seen so much volatility! All I can say is “get used to it” as that is what happens when markets start to make a big trend change. Those that are already out can sit back and watch this market crash, until it becomes over sold again.

Any big forecast how deep a bear market can go is depended on what degree of a peak the markets are all at. So far they expected just a 10% correction, but now this number is changing as well. Some are now calling for a 40% correction, but a 60% correction number has also been used. All the forecasts in the world for a bear market bottom will mean nothing, if we don’t know what’s going to happen after the bear market finishes.

At a minimum the Nasdaq has to retrace the 4000 price level first, and this may only be a temporary resting spot until another leg down starts.

Bull markets end when nobody expects them to end just like bear markets will end when nobody expects them to end. This has happened so many times in financial history that it will not be any different this time. When it comes to the stock markets human emotions never change as fear, joy and greed  has been around since the caveman days.  A new generation of investors do not do any homework in studying financial history, and many of them didn’t even experience the bear market of 2008, so those investors are in for a big surprise.

Mark Zukerberg’s testimony increased his net worth by 3 billion dollars during the time he sat in his chair, while social media supported Zukerberg!  In the long run Facebook is still besieged with problems like the majority of tech companies are having at this time.

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