OIL CHARTS

OIL CHARTS

INDEX CHARTS

INDEX CHARTS

PRECIOUS METAL CHARTS

PRECIOUS METAL CHARTS

STOCK CHARTS

STOCK CHARTS

CURRENCY CHARTS

CURRENCY CHARTS

ENERGY CHARTS

ENERGY CHARTS

 

Category Archives: SP500

Mini SP500 Daily Chart World Record High Review

 

We now have a secondary peak with this SP500 daily chart, but this is not the real high! There are expanded patterns that constantly catch us by surprise, if we are not actively looking for them.

Our wave counts will be so far off course when we do not suspect any expanded pattern to be in progress.  It’s also the biggest early indicator that stock markets are correcting with a Cycle degree flat, while gold is in a zigzag of the same degree. With the gold price crashing we know deflation is the issue, not inflation. The general markets will eventually act together or “hook-up” as all asset classes are going to deflate in price. During the 2008 crash gold, silver, gold stocks, oil and the general stock markets all crashed together for 8 intense months, while the US dollar index soared!

The exact same conditions in 2008 are present now, as the US dollar refuses to implode.  The US dollar bear market ended in 2008 with a zigzag crash, so it’s in a bullish phase that very few  USD watchers understand. It will be the huge corrections in this giant bull market that gold will perform moves that will shock us.

10,000 Boomers are retiring every day for the next 18 years so this will drain workers on a massive scale, and will no longer be producing in the economy. They will also be downsizing, and spend far less in the process. When they start to die, they will also be permanent sellers of real-estate and stock market holdings. Every western or developed country in the world has the same problem with Boomers disapearing on a massive scale.  After every market crash a fertility crash gets reported a few years later which economist don’t even look at. When the future looks bleak, then raising a family will be the furthest thing from their minds.

Hits: 29

Sp500 Daily Chart: Death Watch

With so many potential death crosses out there, I’m starting to feel like the Grim Reaper. With stocks the 50-200 day SMA lines may act a little different than how they do in commodities. I’m sure the markets are waiting for some good fundamantal news, becuase if they don’t then the majority of sell stops below could get triggered. It won’t take much as the bullish herd is starting to get very skittish. Bears always attack from the top down and the big claw came down at the end of January.  A big bear market is coming which very few have any idea how deep and long the bear market will take.

The two SMA lines give us another clue that stock markets are heading down in a griding summer decline, which may end at the traditional September-October months. The last Golden Cross happened way back at the 2011 crash around the 2200 price level. That is far to late to be any use at all, as they are lagging indicators. Counting the crossings, the next crossing should be a Death Cross, which will show up first on most daily charts.

The longer this market goes sideways the sooner the top 50 day SMA line will slice through the 200 day line. You don’t want to be anywhere in long positions when faced with a potential Death Cross. Since everyone has an investor mentality those that know how to play the markets down will be winners this summer.  The Buy&Hold strategy is coming to an end, in a bear market. Stocks are going to “deflate” and even gold will deflate with a $500 crash. Very few asset classes will stand up to such a big onslaught of selling, but in reality the buyers might want to stay away from investing altogether.

I have to keep my options open but a big flat in Cycle degree is still the pattern that I’m after. This could take three years as solar cycle #24 draws to an end and solar cycle #25 begins. I believe a very serious recession is coming which will bring out all the depression fears. Every single degree that we go higher means that bigger crashes will come.

Gold is going to make some wild moves until 2021, as the markets and gold are heading down to the same “A” wave bottom in Primary degree. Wealth destruction is money distruction, which is inflation in reverse. $100 trillion dollars could vanish into thin air, which is very bearish for gold. That’s about a third of all world assets disapearing. The numbers may vary from others but I think readers will get the picture.

If the markets gyrate around another month or so, then I would be inclined to think we are at the top of  “B” wave crash and not a wave 2 top. A long drawn out tail of a market decline could happen. The Nasdaq elephant is probably holding everything up. If investors don’t feed the elephant with “greens” (money), it will collapse for the lack of sugar and crush all the stock bull cowboys in the fall.

Hits: 22

SP500 2009-2018 Bull Market Review

This is the index for the SP500 and does not move during the night trading sessions. I will try and only use two types of  trend lines with both trend lines being even. In this case the trend line is based on the top trend line and then it is duplicated with the bottom trend line. At times I do add a third parallel line in the middle as it can track trends that are one degree lower. I don’t believe in this perpetual bull market going on forever as “ALL” trends always come to an end, and they come to an end when nobody expects them to end. The herd of investors that surged in last week, are already losing money. They have been brainwashed to buy on the dips, but they are buying on the dips for what?  They are hoping for the bull market to return which tells me that they have no clue how deep this next correction will be.

The monthly ETF outflows have not slowed down last month.  ETFs Register Outflows For 2nd Month In March | ETF.com Those that are selling seemed to be more knowledgeable than the investors jumping in, so this does not send any overwhelming bullish messages to me. It all depends on what you believe, what the peak 2018 stock market wave count is, because that determines on how deep this market can eventually go.

I’M looking for a Cycle degree correction, not just some short blip in an ongoing bull market. At the very minimum any 5th wave will get retraced, and that might be the end of the correction, if we just finished a wave 1 in Intermediate degree. I have seen wave counts that called the 2009 bottom a wave two in SC degree, but then we would have to be at a wave 1 top in Cycle degree now! The markets are not ending in a wave one, they are ending on a 5th wave, and a very choppy 5th wave it was. In an entire sequence of 5 waves, the 5th wave is always fundamentally the weakest, even though they can extend and look very strong.

The majority of all expert wave analysts are working from a 4th wave base. I think it is impossible for a 5th wave bull market to survive three or more solar cycle seasons. The SP500 didn’t show any triangle between the 1970 and 1974, but at that time period, it sure fits into a wave 1-2 in Primary degree.

In our little “Blue Book” (EWP) a big correction can crash back down to the previous 4th wave of one lesser degree, and sometimes they travel a bit lower like the 2009 bottom did. To even get close to entering any part of the previous 4th wave of one lesser degree, this SP500 chart has to go below the $1576 price level.

If nobody knows where the previous 4th wave of one lesser degree is then even that forecast will be worthless and irrelevant. Since 2013 my goal has been to hunt, find and confirm all the 5 waves in Cycle degree. Until the 5th wave has been found and completed, there is no mathematical chance to slip into the world of SC and GSC degree wave counting. Every letter or number we change sends us traveling forwards or backwards in time. When we are counting in SC degree, then we’ve made a time “jump” from Cycle degree at the same time. In short a SC degree world is in the future and its’ forecasts mean nothing in our present day Cycle degree world.

Hits: 25

Mini SP500 Index Review

This is just the index chart of the SP500 and only moves during trading hours. It does not move at night like the real contracts do.  Some of the wave patterns come out more defined that those wild contracts that many investors trade with.  This chart shows much better the record low with no truncation or double bottom like it shows with the mini contracts that I normally use. There is no way I can ignore this index to double check in helping to confirm any wave count.

The SP500 index soared from the 9th bottom with only one main correction so far. This is a sign of a zigzag that may have just topped out.   Stock bulls are thrilled with this run as they think the 10% bull market correction is over!  Maybe so, but this move is too vertical and a correction must happen.

The fast decline from the top does not suggest that a correction has even taken place.  I would have to see a completed correction like a full fledged flat or zigzag, in order for me to call it a correction.  Just because this index dropped 340 points does not mean a correction has taken place.   The majority of all investors work on price, they care little about the pattern that has actually developed.

I believe that a Cycle degree 4th wave bear market is coming which I call “The Big Dip”, 😉 . All those that think they are buying into the little dips have no clue that this market has a long way to crash.

Steven Jon Kaplan has sent me a very detailed description of what’s coming in the next few years, and I am the last guy on this planet that will argue with him. EWI also thinks a major top is in and they are pretty good at picking tops. Picking the bottoms by wave analysts needs to be improved dramatically. If the younger investing crowd has no desire to learn what happens at bottoms, then they are following a strategy that the majority practice.

Most investors also ignore the sun cycles, even though the sun cycles control all action on earth. The switch from sc#24 to sc#25 may happen anytime close to the 2021 time period, and when sc#25  does start up,  all our bearish thoughts, bearish wave counts, and opinions will get trashed.

Hits: 9

SPY ETF Review

Both  chart servers I use,  has problems sending out chart data this morning.  In the mean time I will work from my Bigcharts source.

Any extreme vertical move from yesterday does not show up as well. Due to yet another extension, I started to work on the 2016-2017 wave count again using a single diagonal instead.  Early this morning the market saw a reversal that is impossible to see with these charts. The question will be if it is a temporary blip or if there is something more solid to it.  The Nasdaq took a swan dive this morning as well, so it’s not just one index that moved down. 

I have not been tracking any Gold/SPY ratios, but this morning it was 4.87:1 at our present peak. This ratio should expand as the market progresses into a bear market. 

Hits: 3

SP500 2000-2017 Intermediate and Primary Degree Review

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

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

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

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

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

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

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

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

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

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

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

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

Hits: 3

SPY, ETF 2016-2017 Review

It’s always a good idea to look at the VIX before we look at any SP500 related asset. The VIX gages the level of fear, and we can see that this morning the fear level spiked in a near vertical move. Fast spikes I don’t want to see until we get closer to the end of a move, but not so much in the beginning of a move. The VIX just past $14 this morning, but I will be looking for another leg up, if another correction develops.

I have noticed that markets in general can turn close to the 10th or 20th of the month and today the VIX did not disappoint us.

SPY is the ETF version of the SP500, which we can see is not that violent when compared to futures charts. The futures charts are leverage while the SPY is not. The market moved south this morning, which is no worse than a little bee sting when we compare it to any other dips or corrections.

In hindsight, and from the early 2016 low, this market gained about 32%. Today seems to be a bearish day and may be the start of a bigger correction to come. We have gaps in the SPY ETF, and in the long run they will all get filled. Of course new gaps will open up on the trip south, but for now the gaps will be of little concern. 

As soon as the word, “Support” is used, I know that the investors or analysts that use that word, are just looking for another  bull market correction.  They all made that same mistake at the 2000 and 2007 peaks and those dips were much deeper than a simple bull market correction. They were also smaller degree declines than what we are expecting at this time. 

If we think that the 2008 crash was just a, “one of a kind event”  then we are sadly mistaken because we can’t banish boom and bust cycles, when we have governments dedicated to creating boom and bust cycles. I will not talk about a potential short term support level as none of my readers can take advantage of it anyways, besides any forecast I can come up with, I already mentioned with my future updates. 

So far the SP500 is still heading down, but this is very early in any corrective stage, so buckle up, as the road is going to get very bumpy. 

Hits: 5

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. 

Hits: 6

SP500 Supercycle Review

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

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

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

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

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

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


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

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

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

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

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

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

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

‎www.ez3dbiz.com/2016_stock_market.pdf

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

 

Hits: 2

SP500 E-Mini Day Chart Expanded Flat Review

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

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

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

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

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

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

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

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

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

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

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

Hits: 7

E-Mini SP500 Gyrations Review

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

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

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

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

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

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

Hits: 9

Mini SP500 Intraday Top Update

I would love to say, ” The wave count is clear”,  and a crash to the 500 price level is near, but in reality this may never happen if this market keeps crashing, but then fully recovers in a week or so later. The markets can keep this zigzag action up for a long time, and the best we can do is to monitor it. Finding the start of a bearish wave structure is extremely important as  five wave sequences are pointers for further declines.  Diagonals confuse the situation as they contain many zigzags but they belong to the 5 wave family and not the 3 wave corrective group. Any diagonal can only be one part of a correction, but never the entire correction. 

Markets can move so fast that by the time you count out a chart and post it, it can already be dead. If this downturn is part of the  bigger bearish trend than, the SP500 must keep making lower lows. This is when inverted flats and zigzags come into play, which is the exact opposite of what happens in a bull market. 

The VIX has started to crash again, as it blasted up creating another huge gap below.  All gaps eventually get closed off even though it could take years to do.

The markets could drag on like this for a long time,  but I will remain bearish until this market sends us a clear picture of a new downward trend.  All trends eventually come to an end, but until they actually do, we have to play this cat and mouse game.

Hits: 2

E-Mini SP500 Record Highs Update

The majority are so used to having their bull market, that they have become numb or oblivious to the fact, that after record breaking highs, we will eventually get record breaking lows. This June mini contract has refused to die even after some very impressive crashes. 

We are definitely at world record highs, and they are very choppy patterns that fit better as diagonal waves, where only small impulse waves show up. This is the type of market we are dealing with, and no amount of fundamental reasoning will make them  suddenly disappear, and turn into perfect impulse waves.  Important jobs reports are coming out, so this can always send the crowd into a mini panic. 

We cannot rely on any small move down, as this market needs to show us a much bigger and longer decline, to help confirm that a new bearish trend has started. 

The VIX  is also starting to wake up, but it has several open gaps below it still has to deal with.   Any flash move to the downside could close these gaps, but in the long run, it is not critical that they are closed off.  We have just as many open gaps above present VIX prices so the “magnetic pull” is canceled out somewhat.  

I have a very bearish outlook, but exactly when this market will start reflecting it, is still a crap shoot. 

Hits: 3

E-Mini Sp500 Intraday Top Review

The SP500 sideways action or the last week or so, gives this SP500 a double or even triple top. Of course, those kinds of patterns can work just like another 4th wave, so we need the markets to show us some more downside.  We need more evidence to help confirm a bigger trend has just started. How many times has this happened before, when the declines or mini crashes just charged higher.  

This entire top has been the most problematic when we compared the other two peaks since 2000.  The 2000 and 2007 peaks were much easier to read, but they were coming off impulse wave runs. Since 2009 we have had a major bullish phase that every major expert wave analysts did not see coming in early 2009. 

I never though the markets would go this high again, but when they wouldn’t stop,  all other wave counts should have been trashed. I gave up hope on any GSC degree wave counts and started to count everything one degree lower in SC degree.  Of course that only lasted a few years before I had to reboot all my wave counts, in Cycle degree. 

Cycle degree is a full 2 degrees lower than what the majority of all wave analysts sees today.  In late 2008 Steven Jon Kaplan was already calling for the biggest bull market since the depression, while the experts were still playing around with a 5 wave decline. 

I’m not using Cycle degree just to be different, I use it because I count from a wave 2 base, and not from a 4th wave base like the majority do.  Since the 2000 peak in the markets not a single wave has developed, that can confirm any SC or GSC degree peak. 

Everything in stocks, wave 3 gets extended most of the time, and only rarely do the 5th waves extend. Then usually it is the last degree. 1987 to 2000 was a 5th wave extension, but only in Minor degree. For decades, they called the 1987 crash a Primary degree wave 3, which again is a full two degree levels higher than what I see and use.  

There may be no updates this Thursday morning, but I will post later in the day. 

 

Hits: 5

Mini SP500 2016-2017 Review

 

 

This chart only moves during the day. We are only a few points away from hitting new record highs, with about 7 points to go. This has now gone higher than I would like to see, so that is a trigger to review back to the end of the 4th wave.  Then we need to do another wave count to finish off a “C” wave in Minor degree.  This “C” wave had a lot smaller wave structures as well, making it fit rather well into a diagonal C5 wave.

This also would kick the Cycle degree, location of its previous position, but then it would just be moved to the secondary peak.  The DJIA still has more to go just to catch up to the SP500, so we do have some conflicting wave patterns between the two.  If this last little diagonal 5th wave becomes real,  then the wave patterns on the next decline could be very different.

This could still take until the end of the month before it becomes more defined. We are still rolling around record highs which many experts have as a GSC degree top.  Either way this bear market has to be finished by 2021, after which we will ride solar cycle #25 up again. 2021 is the Fibonacci 89 years from the 1932 bottom, which was also a solar cycle bottom at that time.  Solar cycle #25 could produce another 5 year or even an 8 year bull market, and I doubt that we will get a 5 or 8 year bear market rally.

One thing is certain and that is, market participants are extremely complacent, which the VIX has shown us as well.  We are about 5 months away from the 1987 crash date, so that may provide a bit of excitement when we get closer to October,  “Any Day” 2017.

Hits: 3

SP500 Cash Chart, Intraday Bullish Rally Review

 

 

This chart does not trade during the night, but it sure seems to have a better wave pattern,  that can be easier to create wave counts with. On the Intraday charts the SP500 did not drop to new record lows like the DJIA did,  so that always produces conflicting wave counts at this intraday level.  When it comes to diagonal charts, all hell can break loose as the waves can charge up and down dramatically.  At any other time we would just about  call it a triangle, but I don’t think this is the case with this market.

Since all my counts are diagonal everything has to be counted with zigzags in mind. Our present rally sure can fit as another “B” wave rally, which would then be followed by another set of 5 waves, resuming the “C” wave trend back down. We would be heading down another, “C5” set of waves which can extend dramatically when they want to.  If that is the case, then it sure would take the rest of this month to play out,  before we  get close to a potential diagonal wave 3 position.  Any C5 decline can alternate from the A5 decline, where we would hardly see any subdivisions at all,  as they can be really small in physical size.  Just in case you may be reading about  any A5 and C5 waves, for the first time, I use that description to  separate between the leading 5 waves to an “A” wave,  and then the C5 is always the trailing set of 5 waves.  This is for any zigzag in any direction, and in any degree.

I know it sure seems like slow going, but I’m sure there will be times when sheer panic sets in, which will speed up any slowpoke decline.  They have daily limits set anyways, so that usually will put some sort of a cap on any real single dramatic decline.

We are still a full 4 days away from any new moon, which can give us great reversal setup as well.

Hits: 2

S&P 500 E-Mini, Daily Chart 2015-2017 Review

 

 

Most of 2015 was a 4th wave correction, which was a real challenge to get in real time, or close to real time. Spikes to the downside sure helped, as early 2016 showed us with two spikes. This is what I look for when a bearish move comes to an end.

What followed in early 2016 was another mess of waves that I can only fit into diagonal type wave structures. These are made up with zigzags that they can be very ugly to count out, as they can also extend at any time. 

This all brings us up to a new record high on January, 26th, 2017 at the 2300 price level.  The Mini S&P 500 also started down with a gap and so far is acting to script. The move so far has been miniscule, when we look at it from a daily chart perspective, so we don’t want to jump into a higher degree too soon.   

I did put up the Cycle degree wave III at this time and hopefully it will hold. It may still take all of February for this top to become more clear, but at this time we have no double or triple tops we have to sort out.   There is not much of a difference except this SP500 index does not trade during the night. 

Any sizable correction could take us to the 1,300-1,100 price range, which is back to where the great stock mania started from in 2011.  

Hits: 4

SP500 1980-2016 Cycle Degree Review

 

 

At every turning I ask 3-5 questions, assuming that the position is correct from an idealized perspective. In this case a Cycle degree perspective. I spent a good part of my life chasing the wrong degree, along with everyone else on this planet. I continuously lowered my degree levels with no real plan, but now I go at it far more systematically. The high degree wave counters continuously missed major bull markets in every major asset class that I cover, yet the contrarians saw a bull market coming far better than any wave counter ever did. 

By insiders I mean the owners of the stocks that make up all the 5 indices that I carry wave counts on. Not until all 5 waves in Cycle degree are confirmed as being completed, can we ever hope to enter the SC degree world. 

Besides counting in a high degree makes us very insensitive to the bearish mood, as the 2009 bottom clearly showed us. Every insider on the planet was buying stocks back in late 2008 already, while the entire wave counting herd was on the most bearish wave count in history. How did that work out for everybody? 

Insiders do not buy on a whim, as they may hold for many years before ever selling out, so this alone killed the stock bear market in 2009.  

Meanwhile Kaplan, one of my favorite contrarians was calling for the biggest bull market since the depression. Even Warren Buffet was very bullish in late 2008. 

All this under the Elliott Wave forecasts of DOW 1000.  Well, DOW 1000 would put the SP500 at well below 70 points.  No way was this going to happen, as we now know looking in hindsight. Hindsight is a powerful tool and as wave analysts must always go back to find a better fit. Those that do not look back in time, will always have wave counts that will miss bull markets and even miss bear markets as well.  

The Cycle degree 4th wave position can have a lot of leeway, but it would not surprise me if the SP500 stopped short and then charged back up. This all has to happen before or just a bit after solar cycle #25 starts. 

The sun dominates and controls all action on our planet, and if the herd has turned all bearish at that time, then they will miss another one of the greatest bull markets since the Roaring 20’s.  

A Cycle degree decline should put the USA and Canada into another recession, and Canada is already well on its way.  They may end up calling it a depression, but it would be over as soon as those words come out of their mouth! 

At every wave 3 top I look for a pattern from a choice of 5, Two patterns we can eliminate right away, which leaves us with a potential of 3 simple corrective patterns that we should expect. The book tells us exactly what degree levels we need for all this to come true.  I will keep all three open at this time, but the triangle is at the bottom of the list.  There is not enough time in a triangle to play out in its entirety, before 2021.

Again, I would like to thank all the readers that have pushed the monthly pages read to its highest levels since I started blogging. Today we have achieved well over 24,000 pages read, and we still have a few days or so to go. Higher pages being read translates into higher ad revenues as well. 

Hits: 3

VIX Daily Chart Bear Trap Review

 

 

This VIX daily chart goes back about 2 years and represents when investors get panic attacks. It is more related to the SP500 index, and when the VIX price is low, it also tells us that stock investors are extremely complacent. The VIX has seen record lows again as it seems that the $11-$12 price level is a pretty tough line to go below, or stay below.  

We have many VIX H&S  patterns, and when they are at a major bottom, then these H&S patterns can be very bullish for the fear levels.  This can make the VIX a perfect bear trap, and when it shoots up then we know stocks will start to head back down.  The VIX has already started to rise, so all this needs is to continue, or not make another new record low. 

The hype that the mainstream is telling us, make it sound like this stock mania will go on forever, but that would mean that the VIX would have to keep heading south, and head to below zero.  We know that’s not going to happen, which leaves only one option for this VIX, and that is to head up sooner than we think. 

The bottom trend line and the top declining trend line, squeeze the VIX, like a wedge pattern.  Of course the emotional investors never look at the VIX, as chasing a bull market is more important.  For the contrarians, the VIX is very important as it can trigger stock buying and selling situations. 

Much of this may not mean much to investors, but at the COT level, it is a different ball game. Commercial traders have been in a net long position with the VIX for a long time already, but last week they added yet another 6,671 contracts to their long  positions.

On the flip side of this equation are those that just speculate, which tells us how much more complacent they expect the markets to become. The speculators are short the VIX under a 2:1 ratio.  Both parties cannot be right, so a bear trap is close at hand in snapping shut. 

How high the VIX can go is never certain, but when a spike to the upside forms again, then chances are good we will be in another VIX bull trap. 

On Friday many stock indexes have already started to roll over, so it is just a matter of time before the public starts to notice it.  

 

Hits: 4

Another Look At The SP500: 2011-2015

 

ESY00-July-19-2016

 

One major reason why I see that many of these waves are so choppy, is because the majority of these waves all fit into diagonal waves.  A sequence of 5 diagonal waves, which I call the Diagonal5, has happened most frequently in the 5th and C wave positions. They also develop in the “A” wave positions. Counting these diagonal waves with impulse labeling is wrong.  Between the two they behave radically different. Diagonal bull markets are joined together with zigzags and flats,  while the impulse only corrects with zigzags, flats and triangles.

Here is a good example how we can time travel, when we move just one single wave position around. Before we were looking into the future for the wave 3 position in Cycle degree, and now we have the Cycle degree wave three behind us. ( 2015)  This may only be temporary, but we have to see if the first part of an expanded flat,  is already in progress.

If the Cycle degree has completed, then we have an all new ball game. This will leave many wave counters pulling out their hair, as the mythical fire breathing dragon called, “Primary degree wave 5”, refuses to appear.

We can still take some upside, but we need a sign, to help the next pattern to develop. We could crash back down to 1500-1600 as the first and only “A” wave in Primary degree bottoms. Expanded flats are very rare in any starting triangle, and zigzags do not expand as well. That leaves us with only one pattern at this time.

 The bottom for the 2010-2011 correction may also be another “A” wave base, so there are many places for the trend reversal to happen.  

So far the upward trend, at the intraday level is slowing, so it is getting ready to end or start some other correction. It has not moved enough to create even a better intraday chart. Hopefully this will change later in the week. 

 

Hits: 2

Mini SP500 Daily Cash Chart Review

 

ESY00-June-7-2016

 

This is the cash chart of the Mini SP500 and is just used in lieu of an index. The June contract will be finished in 10 days, or sooner, after which we will swing into the September contract. With this chart, we still have not exceeded May 2015 highs, but we are so close to breaking out.   Now it becomes important for the SP500 to show some clarity, and not leave us with this mess of topping peaks.  This would kill any hope of a potential, wave two top,  in Intermediate degree.   In a perfect world, I would like to see a cleaner top, but I have to stop whining as this world is not perfect.  Elliott Waves will do everything in their power to constantly try and fool us, as no wave count is a sure bet.

This surely can’t go on forever and we have to see when this next set of 5 waves is going to complete. What type of pattern any decline makes is the most important thing as if they are corrections then another leg up will happen. For close to a year this market has gone sideways with virtually no real net gain. We need all the discouraged stock investors to head  into gold as it is pretty hard to ignore all the gains gold has made, while stocks bounce around like a wild rabbit!   

Hits: 2

E-Mini SP500 2011-2016 Review

 

 

ESY00-June-6-2016

 

In the last year or so this SP500 index has not made any real progress forwards as it would only be about 30 points down. That sure does not qualify as a bear market from my perspective, yet everybody was talking about the bear market. Does this mean its over and stocks are going to fly to the moon? I doubt that as well.  Still, we are faced with numerous peaks which eventually have to be sorted out and put into the bullish wave count or the bearish wave count.

It is foolish to think that and record high is the real top, or to even think we have a truncated 5th wave. I think there are far less truncated waves than what experts count out, as truncation can be the solution to a wave count when we are stuck. Most of the time we can make any truncated pattern fit.  This all boils down to a very high probability that the “B” wave in Primary degree has been completed or we are still fooling around with the tail end of the 5th wave. 

It may be a triangle, but where is the “trust” that usually happens following a triangle?  Stocks would have to fly much further if a triangle were still in progress.  Markets are very slow and lethargic which does not fit into a triangle pattern as well.  At this time it is still prudent to keep the wave counting options open, as things can change very fast when they want to. Sure, an upside breakout can still happen, but this close to record highs, can make for a very tempting short position.   

 

 

Hits: 3

Emini SP500 Intraday Review

 

ESM16-June-2-2016

 

This E-Mini SP500 contract  has many of the same wave patterns as the DJIA has but there are also differences at times that conflicts with anything the DJIA has produced.  In this case and starting an impulse wave is riding much higher than the DJIA, which could produce extensions on the way up.

I also have two wave bottoms that must not get breached, especially the first one just below 2090.  We are about 40 full points away from reaching a new record high with my charts, and this can potentially be getting close to a Primary degree “B” wave top.  I have drawn out and posted on a page that gives us an idea what can happen after an expanded flat has formed.   After a year of going up, down and sideways, the market is only down 40 points or so.  Meanwhile, many single stocks have been decimated, and we sure can’t forget the big oil crash as it must have erased a trillion or more.

An upside breakout is the preferred path at this time, but  a diagonal may also be in progress.   

 

 

Hits: 2

Mini SP500 Intraday Review

ESM16-May-9-2016

I am looking at this SP500 as a potential corrective decline with another smaller correction in progress. There is very little room to move here so it won’t take very long for the markets to show us that they want to push higher. Gold sure has reacted to this and so has oil. If we were to progress down with these many  overlapping waves, we will  take forever to get anywhere.  If we are going into a longer sideways triangle type move, then it will also take more time. Right now the Mini SP500 can’t dip into the 2045 price level and it sure must not dip below, 2030. Short term I look at staying bullish but not for the long term as I feel the “big one”  is still to come.  

I can read all sorts of waves on this and even an Intermediate degree wave 2 top, so we have to wait and only take shorter time trades until this clears up a bit more. 

 

Hits: 2

E-Mini Sp500 Intraday Review

ESM16-May-2-2016

The E-Mini has made a bottom, but the rally is not a pure impulse. This could mean a diagonal advance or we are stuck in a smaller triangle and we are heading up the “D” wave.  Any “D” wave could go higher than my “B” wave before it crashes again. This still gives us far too many options in how high stocks can still go.  As long as the markets produce questionable declines, then there is always a chance that they can come back with a vengeance.

This has been going on since the 2009 bottom with late April of 2010 being an extremely bullish time. All the talking heads were yapping how stocks are the place to be, yet the contrarians were getting very bearish, including Steven John Kaplan and EWI.  I was also suspicious that a crash was coming in 2010 and we were not disappointed as it turned into the Flash Crash of 2010.

Now we have to wait and see how high this can go as the worst is always a diagonal move being so hard to see the difference between an inverted corrective move. They both can be very much alike for long periods of time. 

Hits: 5