Russell 2000 2016-2017 Record High Review

If we go back into ancient history like early 2016 the markets all bottomed about the same time. The anticipated bullish phase that developed after the 2016 bottom, was another choppy bull market, which are typically found in diagonal 5th waves.  The entire 2017 sideways move was most likely a choppy 4th wave correction that borders on the line of a mini triangle. Trend lines do not work with this 5th wave as they offered no special insight when I did try them. 

The Russell 2000 is also approaching a potential wave 3 in Cycle degree. So far it has taken about 21 months to get to our present highs and should be ready for another correction. 

All the Perma bulls will get hit hard if they try to buy on the dips. When they talk about buying the dips, their brain is still wired into the bull market mentality.  Bull markets end under extreme optimism, they don’t end under extreme pessimism.  Our present Gold/Russell 2000 ratio has increased a bit more since Sept, and is presently at about 1.17:1  This ratio does not move as much as 1.06 is the extreme side of being cheap. 

This entire 5th wave should get completely retraced, and we will see what type of a pattern decline we have by then. At the very least, we need a correction below the August 2017 low. I’m sure the bears will be Hacking and Slashing all the way down, until all the stock bulls are dead! 

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