Mini Sp500 Intraday Post April Fool’s Day, Crash Review

 

Slowly the Cycle degree peak at the top left will fade away with these intraday charts. In the big scope of things we must never lose sight of  this Cycle degree peak or forget the bullish mood it created. After an 8 year bull market it is easy to forget all about the 2009 bottom,  and get caught up in the bullshit hype that stocks are still in some super degree, move with lots more upside to go.

Just like around March 2009 when the bear market ended, we now have an extreme top in early March,  that may have been the end of a Cycle degree wave III, bull market.   This morning stocks took another hit on the chin and it looks like it would be an ordinary correction due to the long looking spike today.  The problem is that diagonals act exactly this way, as zigzags are linked together  making us believe that a correction is in progress. 

If no correction is due then this decline must get completely retraced confirming all we had were false rallies. There are also big differences between the DJIA and the SP500 wave patterns so this can fool us,  if we only stick to one index. 

At this time we could be in the first part of a single zigzag but in Intermediate degree. A potential Cycle degree 4th wave correction in the shape of a flat would be nice, but it is never guaranteed or perfectly “Clear”.  What has to be clear is the idealized wave pattern, where it spells out what type of patterns we are supposed to get, if our wave count is accurate. 

In the next month we should see this market break new lows by a wide margin, as we could be approaching a bottom to a wave 1 in Minor degree.  Of course, there will be diagonal waves that will do everything in their power to screw up any wave count, so that always gives us the potential for unexpected surprise moves. The worst can be that we are brainwashed by the simple impulse wave patterns and  we ignore all the  connecting zigzags.  Impulse and diagonals are two different patterns as the EWP book shows. In the book they call it an ending diagonal in a 5th wave position. If any 5th wave can produce a diagonal of any type then they can happen in any 5th wave, at all degree levels.  Stretching that ending diagonal  just makes it another choppy 5th wave, but it also gives us a big hint as to where we are. 

The markets will change fast, where long drawn out explanations will not last long. 

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