Sep 10, 2015
The next weekly analysis will be around the end of September. I will be traveling in the next two weeks. I had bullish bias after the sell off because I am comparing the price action/technical indicators/market breadth with previous corrections of this kind and I would say so far the history repeats itself. If it continues to "rhyme"(it is never exactly the same) we should see one more leg higher to finish a zigzag. In 2010 and 2011 after the sell off a zigzag higher has followed which lasted 17/18 days. The pattern so far looks to me like a leg higher consolidation(triangle) and another leg higher should follow. A new 40 day cycle at day 12 is running if we see another 3-5 higher days and the move will look similar to the previous corrections. Next week is FOMC 17.09 with important decision so again if history repeats the current move should top out around FOMC. The move higher is corrective, I do not expect V-shape recovery so after a top the bottom will be tested probably mid October. The whole move looks to me like a zig zag and the current sideway pattern should be a triangle. Below 1910 is bad and will mean that a bigger wave lower has begun - expect lower low.