SP500 Midcap E-Mini Update

This S&P Midcap bullish phase produced another wild ride to the upside. It looks like 5 waves up as the subdivisions were very small.  A single zigzag crash ending in December 2018 can make all this fit into a diagonal set of 5 waves down in Intermediate degree.

The Midcaps found resistance just a bit above the 200-day MA line which still leaves the Midcaps under the influence of a  Death Cross.  March can also give us fantastic turning times in both directions, but we have to have the patience for this to play out in the short-term.

I don’t have a big database on any Gold/Midcap ratios but today we are sitting at 1.48:1.

The commercial hedgers are still net short the S&P Midcaps but not by all that much. In other words they can swing to a net long position fairly quick.

 

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S&P Midcap 400 Review

The markets have been bullish but any rally will still be a bear market rally. This S&P Midcap 400 index is important to keep as it could be acting a bit like a leading indicator. The 2015-2016 bearish phase had the world in a mini panic. Not much has changed as fears have returned with a temporary breach in the bearish action.   I have mentioned it many times how deep any market can fall and it all depends on what degree the bear market is supposed to be.  The 2015-2016 is not the previous 4th wave one lesser degree if we are looking at a Cycle degree bear market.

2015-2016 is only an Intermediate degree 4th wave. If the “C” wave ends towards the bottom range, it would only match Intermediate degree to another Intermediate degree bottom. This is a good thing as once this bottoms we are forced into a higher degree. The SP500 and the DJIA are still a long way away from doing the same thing. Comparing one Intermediate degree with another helps to keep us from bouncing into a higher degree before its time.  Many wave analysts are at a “B” wave cycle degree top so they require 5 waves down in Primary degree.

They will never find those mythical 5 waves in Primary degree even though this is the third time they will be trying since the 2000 peak. Some of the wave counting experts have already reached GSC status in 2000 which throws time into disarray.  The majority of “All” wave analysts have time-warped into the future by 50 years or more. Change a few more degree levels and we could time-warp for 90 years.  This may be hard to understand for readers, but flipping numbers and letters around with no respect for the time-warping that happens each time, has never worked.

The short version is that wave analysts working in higher degree levels are feeding us a mythical world that may still be 50-100 years away. GSC degree wave three might get close by 2071, not 2000!

The majority of wave analysts are showing you a mythical world which means nothing. My world is all in Cycle degree which every person on this planet will experience at least once maybe twice, in their entire lifetime.

Minor degree runs happen more frequently, with 5 waves in Intermediate degree, also being part of the landscape. I believe the markets are in a Cycle degree bear market which could take until after the 2020 elections are finished, with Solar Cycle #25 slated to start by then as well. If a market creates its 20% decline is that the top of a bear market, or is it the bottom?

Once this Cycle degree 4th wave bottom arrives, then we can dust-off the idealized 5 wave sequence in Primary degree.

If we go back to 1932 or 1974 and you see a 4th wave bottom in SC or Cycle degree then these analysts are telling us that 5th waves can extend 50-90 years or even longer. Nowhere in market history has this ever happen, as it is impossible for any 5th wave to last the time span of multiple generations.  The EWP is never about what you think we are seeing, but it’s all about how well we visualize what the real idealized impulse is supposed to look like.  The idealized pattern is the blueprint for market action and when we are wrong, we shouldn’t throw out the blueprints because we are too lazy to find our own mistakes.  I spent over a decade chasing GSC and SC degree wave positions and for 5 years have been working the markets from a Cycle degree perspective.

Every big bear market investors will ever face, can give us 3 simple corrections. Eliminating the least likely patterns first reduces our choices and what is left may be the right one.

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S&P Midcap Crash Daily Chart Update

This Midcap chart is one of the best forming wave patterns I have. We are getting spikes to the downside but that is pretty normal. Soon we should get to a point when wave 3’s start to appear, then you can bet that the waves will start to get real choppy. More diagonal waves will start to show up and wave patterns will get more confused. The goal is wave 3 in Minor degree so hang on to the saddle as this market is as wild as an unbroken horse. We will get many  reasons why this market is plunging and these reasons will change like the wind. What investors don’t realize is corrections and bear markets will always be  part of the landscape and the difference is just the degree!

In a few years we are heading down to a Cycle degree bottom, which is only one degree higher than what the 2009 bottom was. Most expert wave analysts are already in SC and GSC degree because wave 3 in the past has  “Never” been extended. We are dealing with a wave 3 in Cycle degree that is close to 76 years long, while modern wave analysts are working on an 89-year wave 5 extension.

There is no way that during an entire human lifetime we are in a 5th wave extension, spanning multiple generations as well. It is easy to tell when wave analysts are into a bigger degree than what they should be, and that is to look at the 1987 crash wave position.

Any wave analyst that is looking for a wave 1-2 in Primary degree now is way off in a time warp into the future. A Primary degree decline cannot happen, folks as not a single SC or GSC degree wave count has been confirmed in the last 18 years.

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S&P Midcap Daily Chart Update

We have a triple bottom that is being formed this year. I doubt that the 1760 bottom will hold, as investors usually get their nickers in a twist when support fails.  Below that 1760 support their are all the sell orders being stacked up, to protect the bullish investor.  

When the protective sell stops get triggered this turns the once-bullish investors, into stock bears instantly.  Some of my updates will be on the shorter side and many of my postings will be erratic as I will take more downtime for the next 3 weeks or so.

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S&P Midcap E-Mini Daily Chart 2018 Review

 

The S&P Midcap futures have not acted like the DJIA or SP500 has at the daily chart scale. The Midcaps have not traveled nearly as far down as the other indices have, where we can see a higher bottom completed already.  The short story is that there is an excellent chance that the Midcaps can soar higher on a “C” wave bullish move. Futures daily charts are the best to look at the 50-200-day MA where we can see that a Death Cross has already formed. This is about as bearish of a signal that we can get. This market can charge through the 50-day MA with little effort, but could then run into stiff resistance at the 200-day MA line.

A short correction can still happen next week but any move above November highs would be the minimum to help confirm a “C” wave bullish move is still in progress. At 1920, resistance should stiffen up, but there is never any guarantee that any bullish trip still to come, can’t end early.

I have no useable Gold/Midcap ratio data based setup, but presently it takes 1.54 gold ounces to by one unit of the S&P Midcaps

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S&P Midcap Death Cross Update

Investors already got a good taste of what a Death Crossing can bring. The 50-day MA has crossed the 200-day MA in this daily chart, which they call a “Death Cross”. Many have no clue how damaging a death cross can be, but we have plenty of examples of real-world bear markets imploding after the death cross. If the wave 2 in Minor degree has completed then the wave 1 price support at 1769, will definitely not hold.

Looking for 5 waves down is my first choice but we are still a long way off, before wave 3-4 in Minor degree arrives.

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S&P Midcap E-Mini 2000-2018 Update.

 

I had to use 1500 bars with this weekly chart as it shows better contrast. I started back with the 2000 peak which was followed by a very clean or near perfect expanded flat that I have run into. The correction only took a few years or so before it turned and started to soar north again until the 2007 peak!

At the 2007 peak the majority were extremely bullish and they saw no end to the good times! Market Hulbert did a very good job of recording the 2007 bullish top as he collects all his own data!  The bullish herd never listens to the bears stock outlook anyways, so the majority got hit hard all the way down until March 2009!

Even when all the indicators showed that the 2008 market crash is going to turn, the Elliott Wave crowd were looking for a much deeper run well below 1996 price levels.  Hell looking for another 5 waves down in Primary degree would have taken the Sp500 Midcaps to “ZERO”!  Insiders were already buying everything that was crushed in price, yet the wave counters remained extremely bearish.

The records how bearish market analysts were at the 2009 bottom are still floating around the internet! Having a bearish wave count, and ignoring the start of solar cycle #24 along with every bearish investors will never work. They will never work when it happens with the start of solar cycle #25!

Even Warren Buffet’s scream to buy stocks in 2008 the wave counting crowd was oblivious to all of it!

When you look at the big picture we can see that the 400 price level has some serious support. This could end up being major support for any future bear market that you can dream up. Any Cycle degree 4th wave bottom may stop well short of a new record low, so chances are good the wave counting bears will miss another huge bull market being set-up!

Many boomers were wiped out with the 2007-2009 crash, so buy and hold will not work for the older folks getting ready to retire.

The Fed is creating a liquidity problem around the world by raising rates, and subtle reports show that is exactly what is happening. President Trump is at odds with the Fed as they choke the life blood out of this market. All those that think gold is going to fly due to inflation are fighting the Fed as the Fed is trying to kill inflation.

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S&P Midcap Daily Chart Crash Update

 

My wave 3 in Cycle degree peaked back in January of 2018, not August of 2018 like the herd of analysts are telling us.  When the media is calling for a potential buy on the “dip”, then they have no clue how big this impending bear market is going to get! The stock mania has already ended folks, as it ended in January 2018. This secondary peak the markets struggled with, belongs to the bear market, as it is an expanded type of a top. Expanded tops are not strange or rare as they can happen in other wave positions as well, like in a wave 3-4 correction.  I could type until my fingers are “raw” explaining the expanded pattern, yet very few wave analysts can even see them.

5 waves down in Minor degree, is what I’m after, and I don’t think we are even close to any potential wave 1-2 position in Minor degree.  We can see how emotional traders really are as all those bulls are now being slaughtered by the stock bulls. If we hear the words “Support”, then ask yourself, “Support for what”?  Some flimsy price level created from a shape-shifting top will throw all wave counts off, and that is only if wave analysts are even close in their wave counting positions!  This is not a GSC, nor SC degree peak, as SC degree is still decades away, in your future. The impending bottom could be closer to 2022, so we have lots of time for this bear market to shred all bullish investments.

The 2008 crash was just a small example of what can happen, and if investors think, it can’t happen again, then they will be wrong and pay dearly for it!  Many experts are telling us to invest for the long-term, and stay the course!  How did that work for stock investors in 1929, 2002 or 2008?  From the 2009 bottom to our present peaks, MidCap investors would have gained 500% in 9 years.

Now they are trying to beat the market, but as usual, the markets will “beat” investors to a pulp.  Are you ready for a 70%-80% correction? The trick of buying on the dips will not work if we don’t know that we are staring into the Grand Canyon. There is a generational shift in effect which will cause the price “deflation” of assets, but the media calls “price deflation a market correction”.

Sooner or later they will start the “blame game”  as they always have to find a scapegoat for investors troubles! If you want reasons for the markets decline then just do a little research in what the “Boomers” are doing. Since 2011, 10,000 “Boomers” have been retiring every day and do you think they will leave their money at risk if they knew about the generational shift?

All those boomers retiring, do you think they can brag about selling at the top? Nobody I know of can tell me that they have retired with all their mutual funds intact paying them during retirement.

seen some “Unusally” high amount of visits, to the point I registered over 7000 hits in 24 hours.

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S&P Midcap E-Mini Daily Chart Update.

This Midcap futures chart has recently pushed to new record highs. Just because we are seeing new record highs does not mean that the next leg up has started, but it could mean an expanded top is also in progress. The result can be a decline that will shock investors as it will go deeper than any correction we’ve had so far. Any further drop in the markets, and the Midcaps would be sitting on a Death Cross!

We can draw a rising wedge which is also an extremely bearish indicator so there is not too much to jump up and down for. Below virtually every support price (about 4 of them) there are sell stops being stacked up, so all those bulls turn to instant bears as soon as their sell stops get hit.

Not until the markets decline in an obvious fashion will the stock bulls on the wrong side start to panic. There is the also a very high probability that in the begining stages stocks may act a bit different than gold. They could sync up very well for any “B and C” wave in Primary degree. 2/3 of a zigzag and 2/3 of any flat can be virtually the same. This would be the most obvious demonstration by the markets, that a deflationary crash is going to happen.

Market fundamentals will always tell us the wrong things at the extremes. When all the stock bulls start to think alike then chances are good they are wrong and the opposite should be considered.

Even the DJIA may have peaked today, but again this has to get confirmed by recording a last high.

 

 

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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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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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SP500 Midcap Intraday Update

This SP500 Micap chart has also stopped well short of making a new record high. What I have looks like another zigzag rally, but I can change the “A” wave in Minute degree, so we end up with an expanded pattern instead.  We have two strong bottoms that eventually must get retraced to help to confirm that the bigger bearish cycle is in play.  There is no guarantee that we will get a flat in this Cycle degree correction, as a big zigzag could be another option as well. If a Cycle degree zigzag is the case, then the wave 1 in Minor degree can become wave 1 in Intermediate degree.

One good thing is that we have a single peak to count from, as no double top even came close. With the Russell 2000 it’s not that obvious, as it is very close to a double top. At this time it can also work as an inverted wave 2, but one little spike to a new record high will instantly trash it’s wave count.

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S&P E-Mini Midcap Stocks Update

All the January 2018 gains this market has made, have now been wiped out,  joining all the other electronic bits and bytes in the great digital graveyard 6 feet under.  Of course, many Bitcoin remnants are down there as well. What the majority once thought was real money,  has now started to evaporate.

You can bet that a big cluster of sell stop orders are congregating,  just below present prices and they will get triggered on the next leg down. Buying on the dips is a one way trip if the little expected dip turns into the, “Big Dip”, like 2002 or 2008.

This market has broken many records on the way up, and I’m sure it will break many records on the way down. One record saw the biggest one day point drop in history.

At the very minimum this Midcap chart should fall below 1200 which will take out my entire 5th wave which Trump takes credit for. He will also get the blame for any stock market crash that will come down the pike in the next few years.

If this is to come true, then my bottom trend line will get sliced in two, sooner than later.  It’s not rocket science to draw trend lines that everybody can clearly already see, because if you don’t see 2 or 3 points to connect, you are in the wrong world. Trend lines are so abused by the majority, that they look like a bunch of kids playing with rulers. Trend lines sure did not help in seeing the biggest bull market in history coming, so it sure will not help now in seeing the biggest bear market since the depression.

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Midcap 400, ETF Review

 

Fools rush in where wise men fear to tread, means nothing to the emotional investor. News of funds pouring into the stock markets is also a contrarian bearish signal. Markets seem to crash after buyers take a break.  I thought I would add this ETF, as it will be useful at the next bear market bottom.

The bull market from the 2009 bottom has gained 500%. Investors left those gains on the table before they decided it was a good time to jump in. They love stocks when they are pointing up, but will come to hate them once Cycle degree wave 4 arrives, and stocks are pointing down again.  Most bullish phases will be 5 or 8 years long where 300-400% gains are pretty normal. The 5th wave gain from 2002 to 2007 was only a 236% gain with 5 waves in Minor degree. 2009-2018 was a 500% gain and this was 5 waves in Intermediate degree.   In the future we will get 5 waves up in Primary degree so I’m sure we will get 500% or more gains at that time as well.

Around the $40 price level a second bottom was created in 2008 which has become a very powerful base to build from.  The EWP is not all about counting waves, but it also has to include counting our idealized waves for each successive 5th wave bull market. We had a 5 wave run in Minor degree and then a 5 wave run in Intermediate degree, with the next single 5th wave run being in Primary degree. (2021-2029) After 2032 we should run into 5 waves in Cycle degree.

My Cycle degree wave counting method came about because the majority of expert SC and GSC degree wave counts come from 4th wave bases.

This can’t happen folks, because there is no such thing as a multi generational 5th wave extension. Maybe when we get into the 5 waves in Cycle degree, we could see that it might be two seasons long. One season can be as long as it takes the solar cycle to flip completely from a top to bottom, and then back up to the top and then down again. (2000-2021)

Of course, all those forecast into the future will be beyond my time, and for it to get confirmed others would have to carry on the work.

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S&P Midcap E-Mini 2000-2018 Cycle Degree Review

I spent several hours looking at 3-4 very popular wave analysts, to see what their largest degree is that they are working.  This is always a very painful experience for me because they practice, “Cosmetic Elliott Wave Counting methods”.  They smear the charts with all sorts of price and wave positions to a point it seems like they are conducting a Smoke and Mirrors operation.

They can make a few cosmetic changes and they will always come out being right. Sure, I don’t always know what positions we may be at any one time, but I sure do know what doesn’t fit. Without a doubt they are very bullish with one wave count showing Cycle degree wave 1-2 for the 2015 correction.

One wave analysts have the 2009 bottom, as a wave 2 in SC degree???  Not on your life,  as there was a SC degree wave 1-2 crash and bear market in 1929-1932 already.

Just because it’s a big and tall bull market, does not mean we should jack up the degree levels. We have to do the exact opposite.

When markets extend either in the wave 3 or wave 5 positions, it’s always the smaller degree levels that come out of hiding, not the big degree levels.

All the wave counting with mini or micro mini degree levels, is useless if we miss the biggest bull market since the depression. Any wave count that is in sympathy with the bullish herd at these extremes will never work.

This Midcap chart has a very good wave formation, producing a tall 2007 peak. Also the 2009 bottom never went as deep as the SP500 and the DJIA did. At the 400 price level, we have what would be a massive base, that could last one hundred years into the future. Markets love to fool analysts so just to prove me wrong, the Midcaps will go lower than 400.

Everybody on this planet already knows that stocks are at record highs, what they don’t know is how big and long the impending bear market in stocks can be.

One of the worst SC degree declines in stock market history only took 3 years to play out, so it sure is not going to take sum mythical 600 years this time. The start of solar cycle #25 will make sure another bull market will come. Betting against the power of the sun, or creating super bearish wave counts with the start of any Solar cycle will never work.

Wave counts from the past have all started from a 4th wave base which can’t really happen, as a multi generational 5th wave will never exist for that long.  Any 5th wave is always fundamentally much weaker than any wave 3 of the same 5 wave sets.

I’m anticipating a Cycle degree bear market which will unfold in stages. For starters, this Midcap chart will decline/crash to the 1200 price range first. After that, the 700 price level would be the next price target for the impending Cycle degree 4th wave.

The Gold/Midcap ratio is sitting at 1.48:1 which is on the extreme side of things already.

Investors are pouring record amounts of money into stocks

Average investors are pouring money into record high stock markets, which is actually a contrarian bearish signal. Investors love to buy “High” because they sure weren’t  buying low in 2009. They were selling low in a panic to get out, which I’m very sure will happen over and over at every major low we will ever run across.

Investors pouring into stocks is not smart money moving in, as smart money has already moved out with insider selling.  Fool’s rushing in where wise men fear to tread is very normal. Buying on the 5% dips will not work if we get a 70% correction. We could end up with the mother of all dips, yet very few will ever take advantage of a crash bottom.

 

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E-Mini S&P MidCap 400 Index Bull Market Review

This is the cash, futures price chart, expanded to a weekly chart with 1500 bars. I kept the wave count fairly simple, but the most important question is, “what degree and pattern is our present bull market”?  Starting back at the peak of 2000, we had a sideways, and then a fast down move which is a flat. From late 2002 to 2007, the markets gave us another bullish phase lasting close to 5 years.

By mid 2007 this market was ready to implode, and sure enough the world was embroiled in a financial crisis, which it’s still trying to recover from today. I have the early 2009-2018 bullish phase as 5 waves up in Intermediate degree, terminating at a 5th wave in Primary degree.

If this 2009-2018 rally suddenly becomes a 5 wave set in Primary degree, then anyone with this wave count has transported themselves into the future a long time ago. One simple large degree being in the wrong place, can move us around in time by 100-200 years.

Moving wave positions around with no respect for the sequential math involved, is the fault of consensus analytics, it’s not the failure of the EWP.

If our wave counts cause us to miss complete bull markets, then it’s “high time” to throw out our original premises and start again.  The general guideline I use is, “if a Primary degree 5 wave set fails in any direction, then at a very minimum, you have to completely recount all wave structures going back two higher degree levels”.

A Primary degree failure must force us to review all past SC, and Cycle degree positions. Any kid with a hacked EWP book can baffle us with the mindless use of numbers and letters. What good does trying to count all the mini, mini, micro mini wave structures, if we end up missing an entire 8 year bull market? Sure, I count the small intraday wave structures, but I do that with my finger pointed at the screen or from a printout.

In the next 2-3 years, it will be important to recognize a large “ABC” pattern when it starts to finish, as after this “ABC” pattern has completed, another 8 year bull market would be ready to rise from the ashes again. Below the 2011 low of 400, is the minimum retracement that we would need. More downside than that is not a problem for any impending bear market. I like to be specific in what I must have or must get, so it becomes easier to notice early when we are wrong.

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S&P Midcap E-Mini Record High Review

Since the mid August bottom this mid cap cash, futures chart shows a bullish leg that moved vertical in the last few days. A vertical move and new record highs, is a clue that, at a minimum,  a correction is coming.  The million dollar question is how big of a correction, we should expect.  A Cycle degree crash is still a correction, even if it loses 80% of its value.  

It is the majority of analysts that will call it a huge bear market, but they will not find out until everybody parrots the same consensus opinion over and over. Until this chart takes out or slices the bottom trend line we will not know for sure that a big bearish phase is already in progress. 

Every decline I start with, I look for a set of 5 waves, because they are pointers to a new direction. I already have the idealized wave count up for a Cycle degree correction, and most markets may stop well before any 2009 lows. If you are still super bearish by that time, then markets will leave you in the dust, as the solar cycle #25 bull market starts. 

Nothing that hasn’t happened before, as 2009 is a perfect example what the upswing of solar cycles can do. 1932 was also the bottom of a solar cycle, so it has happened many times before.  

We can still have a full 3 years for this mythical correction to play out, and investors will be fleeing the markets in fear. I’m sure the markets will be in an over-sold condition long before any major correction finishes. 

When the conditions are right then insiders and the seasoned contrarians will be the main buyers. Insider buying of public companies must be reported, so this is not some secret information available to just a few people. 

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E-Mini S&P MidCap 400 Index Intraday Record High Update.

Since mid August 2017 this Midcap 400 index soared to new record highs once again.  So far the tops between all the other indices are fairly well synchronized. That also means then can crash together when the time is right.    A steep run like this is not normal as bull riders just want to pile on because it is going up. Most of these moves have little to do with fundamentals, but have more to do with chasing a bull market. Retail investors just love to buy high and ride the extremes, but as history has shown us, no trend ever lasts.

Single vertical moves always run out of steam and the very least we should get another strong correction. We have many open gaps below so all these gaps make for a great target price. I would love to see 100% retracement of the entire 5th wave rally, but that would act just like a bee sting. We need a big correction that will cause the majority of analysts to wonder what is happening.

How deep can a Cycle degree 4th wave go? I will be surprised if the Midcaps don’t fall lower than 800. This would take the next 2-3 years to play out and the markets have to give us a clear sign that they are ready to do so.

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E-Mini S&P MidCap 400 Index (EMD)

This S&P Midcap 400 has also pushed to newer highs but is still far away from breaking any new world records. We were about 44 points away from an upside breakout, but in the process a few critical waves overlap that makes them next to impossible to fit into an impulse wave count. By early next week we should know more if the Midcaps breakout.

I’m staying with my starting degree level, but a new breakout would definitely change that. If this is part of a counter rally, then without a doubt the Midcap 400 must still crash below that 1685 price level. This week should be the end of the September contracts, but the December contract looks ugly at this time. I will see how December looks, in the chart detail it gives me, but I may have to stop the wave counts on this Midcap for awhile. 

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S&P 500 Midcap Intraday Rally Update.

This Midcap chart has also tried blasting off to the moon, pushing the index further than I wanted to see. This is not the start of some impulse wave which would soar to new record highs, but it has far too many overlapping wave structures. The “C” wave bullish phase is very typical with the big difference being the degree  level that we are dealing with.

This rally is getting into the previous high, but can go above the 4th wave if need be. To confirm that this rally is just a bearish rally,  the Midcaps have to crush that 1685 price level, by a wide margin. Another zigzag would work just fine, helping to keep this index as a leading indicator. The VIX is headed to $10.50 reflecting the sudden mood of complacency. When investors become complacent again, you know the markets are getting ready to deal a blow to the  bulls egos again. 

Once a decline becomes more obvious to the majority, then we could see the pace of any decline pick up and waves starting to smooth out again. 

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S&P Midcap Intraday Update.

This Midcap chart decline, sure looks very similar to the Russell 2000 decline giving us two indices that seem to be leading the bear charge heading south.  This is a good thing as we have a few indices that the majority has been ignoring. When the media wake up and starts paying attention, then chances are good the Midcaps will be ready to rally. 

The next leg down should also be a single zigzag with alternating A5 and C5 wave structures. It could be a short decline, but we have to see how the pattern starts to unfold, before we jump to conclusions. 

At this time the Cycle degree wave 3 is up, but this may be temporary if I’m still far too early. If I’m way out in left field I assure you the markets will ‘force’ a major review, where I have to find a better fitting location. For over 15 years these markets have force reviews on all my early wave counts. Constantly going back in history to find what you missed, takes a long time to do, which many of the expert wave analysts have never done. 

For now I’m bearish until this rally is completely retraced, and a new record low is regurgitated by the parrots. This is harder to determine at this intraday scale, as this index is not on the radar screens in the first place. 

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S&P Midcap Intraday Review: Still Leading!

Last month the Midcap futures contract hit a major peak. It has since been rolling downhill followed with about  a  2 day rally. I would love to see my wave 2 top hold, but we have to keep our choices open, just in case it can still rally to my previous “B” wave top.   Some indices do  take the lead while the rest of the planet is focusing on the record highs that the DJIA and the SP500 have been making.  

It’s the classic magician trick, by causing a distraction in one area, the real decline could be well advanced in other less known indices. I’m sure the same thing will happen at any major bottom when the long term base can give us an early bottom before anyone clues in. 

At the 2009 bottom the Midcaps were at 400 which left no room for any major 5 waves to still play out. At the same time they were screaming DOW 1000 yet the exact opposite happened. From a 400 base and the worst fundamental conditions the markets performed a miracle and started  to rise. It ended up being the biggest market rally since the depression, leaving the majority scrambling to get out while they should be doing the exact opposite. Insider buying had already been in full swing by late 2008, so a bottom was already fast approaching.

Insiders made their mass exodus in May of 2017 leaving the retail investor holding overpriced assets as they head into the markets. In the long run they will pay the price as the concept of buying low and selling high is a strange idea to most. 

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S&P Midcap E-Mini Bearish Decline Review

The S&P Midcap is another index that seems to have started its decline a bit earlier.  I try to isolate the single most important wave at any top, so we can have a clear wave to count from. Yes, I started with a small impulse, but that will be adjusted once this decline lasts longer or becomes bigger in the next few months. 

The last peak was about 1794 in July, yet the mainstream media was hyping the record highs that the DJIA and SP500 provided. This is an old magician’s trick to keep us fooled,  thinking that the stock market is still in some big bull market. 

At any time we could switch into diagonal waves as the first 5 can look like innocent impulse waves, but the next five could get real ugly. Waves may get physically bigger and start to overlap dramatically if the wave 1-2 I show, is a flat in a “B”wave connecting a zigzag.

In the bigger scope of things we want to see this trend continue putting a lid on that July peak. That July top would eventually be the Cycle degree wave three top, and to correct this Cycle degree wave 3 top, we need a 3 wave correction. They will call it a bear market once it gets going. 

Yes the label “Bear Market” sounds impressive and scary, but in reality, it’s just another correction in a bigger bull market yet to come. This bull market may not be ready to start until 2021 or so, so don’t get into a panic by buying on any dip now. 

Many may think it’s a good time to get into the stock market, but record highs can also be a good time to slaughter all the sheep that follow blindly. What possesses investors thinking it’s a good time to get into the markets at record highs,  is a lack of investor willingness to do their homework. Investors just getting in are buying into what could be another 1929, 1987 or 2007 like peak, after which this market could suffer a 70% decline.

Markets are not fond of years ending with a “7”, as 7 seems to be an unlucky number for stock markets. This may take until 2021 to play out, and until that year arrives, this market can make many twists and turns that will boggle our minds.

In the next 4 years or until solar cycle #25 starts to appear in the Northern Hemisphere of our sun, we could be in a giant flat or zigzagI prefer a flat as this would be the opposite of  what happened in wave 1-2 in Cycle degree. We don’t have enough time to complete a high degree triangle, which seem to be very rare as well. 

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S&P Midcap E-Mini 2009-2017 Review

 

Since the 2009 bottom this Midcap SP500 futures chart, has been in a massive bull market containing many wave patterns that just don’t fit well once we try and count it as a true impulse.  It has now lasted well over 8 years, which rules out the possibility of it being a giant bear market rally.

Any real bear market rally would contain far more extreme moves in both directions than what we see now. I see it as a diagonal wave,  which develop in 5th waves regularly. Even if I changed it to a potential single zigzag, it still can be a 5th wave. 

From 1921 to 1929 the same pattern can be seen, but at that time it  came from a Primary degree diagonal 4th wave, which is not the case this time.  The goal is a Cycle degree wave 3 peak, after which we should get one move in Cycle degree, containing 3 moves in Primary degree. 

The present top sure can fit into an ending diagonal, with moves getting violent, but still very small compared to the other wild moves we’ve had. 

In the next 2-3 years, we can expect one of 3 possible simple corrective wave patterns, with any triangle being down at the bottom of our choices. This puts a zigzag or a flat in the running for choices,  with a flat being the top contender at this time. 

Two main price levels that any deep correction can take will retrace the entire rally that started in early 2016, (1200) while the other critical price requirement will be at the 2011 lows. (750) I’m sure the markets will eventually travel much further south than that, but it can also stop well short of the 2009 lows (400).  I’m sure the markets will be in a massive oversold position long before the real bottom arrives, but the majority will be selling as fast as their little algorithms, or mouse clicks can act.    

Of course, as everyone is screaming to get out of the markets, a miracle will happen, as the market hits a bottom and starts to soar on another 8 year journey heading north. 

Be prepared for all this to take at least as long as solar cycle #24 is still alive, but after solar cycle #25 starts by 2021 or so, then all  bearish forecasts will get trashed with no sympathy or mercy. 

At present the intraday markets are still gyrating, so hopefully this will start to clear up sometime soon as we have a bit over 3 months before the 30 year anniversary date of the 1987 stock market crash. Come to think of it, the 1987 crash bottom was also the bottom of solar cycle #21. The markets and our entire planet run on Fibonacci ratios,  and Fibonacci even numbers, so we can’t run and hide from them, but should take advantage of them. 

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SP500 Mid Cap Stock Review

 

 

This cash contract has not seen new record highs since December 9th 2016. Unless a new bunch of Trump followers come out of their caves and bet on the Trump Bump, I can only see this Mid Cap grinding its way down.  The January rally was a three wave move and they have an extreme chance of getting completely retraced. 

Just to get back down to November 2016 lows, there are three gaps that have to get closed off, so anybody staying on the bullish side will get hammered hard, in the next few months. 

 

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S&P 500 Midcap Intraday Bubble Top Review

 

 

At this time it sure looks like this Midcap index topped on the 8th of December ahead of  the DJIA and SP500.

The media reports on what is sensational, as this Midcap chart is ignored. This an all good as this chart can work as a leading indicator many times. The SP500 has backed off today as well, so we have to see if that continues as well.  

Diagonals always seem to be present, which can really throw a monkey wrench in the wave counts. I try to start with low degree numbers, to avoid jumping into a higher degree where I should not be. Once any decline becomes more obvious to the public, then any short term degree adjustment will have to be made. 

Longer term I’m very bearish, but short term things can remain irrationally bullish.  

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E-Mini S&P MidCap Stock Mania Review

 

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This chart is in linear form which makes the bull market look more impressive. Since the 2009 bottom we had a rocking bull market that most wave analysts missed. This has turned into a 400% gain, which nobody was prepared for.  The real rotation into stocks got going in 2011 and we know this because gold stocks started to implode, and the US dollar was also ready to fly. 

It makes no sense to me to believe that we are starting some great move into stocks, from an already very bullish top. We also have a very vertical move breaking to new all time record highs.  A major top may have already been in a few days ago. So how long will it take, before market observers change their minds and become bearish again?  

The entire bull market has been a diagonal 5 waves, which includes many overlapping wave structures that will not fit into impulse waves.  

To help confirm that the Cycle degree wave III has a good home, we know that the markets have to drop fairly deep, well below any 2015 lows. At this time a flat or even a zigzag can happen, but any triangle is pretty low on my list.  Any bear market has to finish at about the same time as solar cycle #25 starts. You never want to bet against the power of the sun by being bearish at that time as it could turn into a 5 or 8 year bull market once Cycle degree wave IV has completed. 

We had a run of 5 diagonals waves in Intermediate degree, so there is no hope of ever getting 5 waves down in Primary degree as we would go to zero if that was the case.   They tried that magic act back in 2009 already, but I’m sure they will try and repeat the same mistakes again. 

 

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E-Mini SP500 Intraday Review

 

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From the September 23rd peak the pattern that the Sp500 has made down into the October 13th low has the look of a zigzag decline.  If this is the case, then this market can still break above that $1275 price level and still go higher. Mind you it will be a choppy ride all the way,  so be prepared for some wild swings still to come. 

All this could be due to the uncertainty of the US  elections, in which we still have to wait until the 8th of November to find out. This election will also take place during one of the most volatile weeks as all sorts of employment reports will come out by the first Friday of every month.  It matters not who wins, as this market is going down regardless who gets in.

 From my personal point of view, I do not want to see Donald Trump, win the election, as it sure seems like he is a big cry baby, and Hillary Clinton has too many skeletons in her closet. 

When the winning president takes over on Inauguration Day, Friday, January, 20, 2017, is when all hell can break loose as all the new minions will kick out most of the old guard.  With a lot of back stabbing, and scores to settle, which will create policy changes that can cause huge problems going forward.

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E-Mini S&P Midcap Intraday Elliott Wave Count Review.

 

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From the spike bottom in early 2016 the markets reversed dramatically, but had started to slow down in the last month or so. The reversal in January 2016 are the wave patterns I like to hit with my wave counts as they provide sufficient power behind them to reduce the risk. Any deep correction scares the traders out quickly as protective stops get nailed, just in time to reverse and go higher. In theory sell into vertical spikes, and buy into bearish spike bottoms when they occur. 

Of course it is hard to buy when the entire herd is pushing bearish forecasts. I was bullish in early 2016 and about the same time Kaplan issued a HDGE sell to his members as he switched when he saw a bull run coming. In general, any wave count we can produce should correspond with what the best contrarians can do. This also happened at the 2009 bottom, so it is not just luck that this happens, as luck should have nothing to do with trading.

All those that had extremely bearish forecasts in 2009 paid the price as the contrarian signals were already pretty clear,  in late 2008.  Eventually we may have to  do the same thing again, but at a much different price level. In the next 3-4 years we may have to hit several more bottoms with the big one being at any Cycle degree wave 4 bottom.  Any anticipated Cycle degree 4th wave bottom will see maximum bearish resistance at the 400 price level. Any price level above that bottom will be very acceptable, as nobody may expect a “C” wave bottom higher than what the mega bears will tell us.

In other words the high degree wave counters will be missing the next biggest bull market in history again! My younger readers will live through this as my Goggle Analytics demographic tracker,  is showing me at this time. This is all good as far as I’m concerned, as many may have no interest in the markets until they are in their early 40’s. The earlier the better is always the best way.

This Midcap index supplies a much more well formed EW pattern, and it is a good index to track as I think it also represents the fundamentals of the economy much better. Fundamentals are breaking down already, as many of the best analysts have mentioned already.  The Wells Fargo fiasco is just one example. I follow a few good analysts on Twitter so that saves me a lot of work.  

Debt loads are soaring again, and Canada also has major issues that are catching up to us. Real Estate has popped this year in Canada, and the oil crash has plunged our GDP.

We will be fine as long as our fearless leader keeps up with his great photos and selfie opportunities. 😉 Justin Trudeau seems like he is playing the fiddle as Rome burns! 

 

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S&P Midcap E-Mini 2000-2016 Review

 

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I always like to remind readers that a very high majority of my postings, are made fresh everyday. Once reason I do this is to always get in a good habit of reviewing the past, as without the past, we have nothing to wave count with, or at least anything that makes sense. This Midcap index has a fascinating pattern as it is so close to being a perfect impulse that it is a joy to work with. 

If we start at the 2000 peak, and then the markets crashed produced a flat that even included an expanded pattern. Then from late 2002 the bull market until the 2007 peak, formed a very good impulse as well. That 2007 peak ended up with a wave 3 in Primary degree followed by another flat type crash.

Now at the bottom of 2009, this chart hit another ending triangle, before it started to soar up again. From the 2009 bottom to our present top is a pattern that does not follow the basic impulse script, but I think it follows the Diagonal5 script very well at this time.

I have tried every other bearish rally wave count, and they just kept falling apart and therefore should have been abandoned a long time ago. For the last 16 years not a single SC or GSC degree pattern has been confirmed. Not a single set of 5 waves down in Primary degree has ever happened.  There was never any room for an additional 5 waves down in Intermediate degree after the 2009 bottom.    

If only all the wave counting experts were screaming bullish warnings at the bottom of 2009, we would have some rich wave counters around. I figured we would get about an 80% recovery, but this proved out to be way too conservative. 

So where does that leave us now as the markets wobble at major highs?  The potential for the markets to be at a close “D” wave top, is just too hard to ignore. Until that triangle is confirmed or fully discredited, the potential for wave three in Cycle degree is still ahead of us. We could swing widely right to 2017 when the 30 year 1987 anniversary date is due. Years ending with a 7, are bad luck numbers, not good luck, as the markets can take a big beating in those years. 

 

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