Nasdaq Index 2000-2016 Review

 

Nasdaq-Aug-18-2016

 

The Nasdaq has always been a wave counting headache, as it diverged dramatically from all the other 2 or 3 indices.  The 2000 to 2002 decline looks like a great impulse heading down, but when we think about it, this can’t be part of a bigger zigzag like many wave analysts think it is. Besides the Nasdaq has already passed all major highs which kills the idea of a big zigzag instantly.  Also the fundamentals after the 2009 bottom were too good to be called a “C” wave bull market. 

The  1998-2002 pattern I tried as an expanded pattern which makes sense for another wave 3 top in 2007.  From 2009 we have another diagonal type wave with the Nasdaq displaying the closest thing to an impulse.  This is all good, but we still have an issue of what is happening with our present top.  I sure can give you all sorts of bearish wave counts, but until the real top is in, we still have options that we have to explore, before Cycle degree wave 3 can find a permanent home.

I am not using the EWP, just for trade setups, but I am actively searching for all of the 5 waves in Cycle degree.   At this time I’m sure that the 2000 peak is not the home for Cycle degree wave 3, and definitely not the 2007 peak as well. This can still put Cycle degree wave 3 into our future provided we don’t head down into a Minor degree “E” wave. 

Right now the Nasdaq looks like it crossed to new highs with a 3 wave pattern, and may even “hang” until we get closer to elections.   Any Cycle degree wave 4 correction will not be 5 waves down, but it could be another zigzag or even a flat type correction. I don’t think we will get a long drawn triangle and I’m sure the Nasdaq will not go as deep as all the super bears want or need. 

The big bears are all saying it’s going to be much worse than 2009, so if that were the case, then the Nasdaq should go below the 2009 lows. Either way, it may take the markets until 2021 to find a real bottom, before the next major bull market can start again. (5 waves up in Primary degree)

The last thing we want is to have a very bearish wave count anywhere near that 2020-2021 time period. Solar cycle #25 will start and solar cycles are bear market terminators. 

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