Feb 9, 2016

Update

The move lower is not finished which is not a surprise and with this 50 points lower it counts better as wave 5 from the top in November. In fact if you are a bull you want to see a lower low this is much more bullish.
The indexes look different. NYSE and DJIA well above the low, SP500 close to the low, Nasdaq and Russell2000 made a new low already. We have so far 3 waves lower from the top last week so waiting to see a finished pattern and reversal.

The same story with the so called "risk off" trades - EUR/USD traded in the range 1,12-1,13, today USD/JPY traded in the middle of the range 114-115, TLT is in wave c of a huge a-b-c which begun in July 2015(see long term post). So we are waiting to see finished patterns and reversals for this trades too. Based on this I am expecting an important low for the stock indexes.

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4 comments:

  1. AnonymousFeb 10, 2016, 7:31:00 AM

    Alternative count: the peak between 1 and 2 should be counted as 2. The following low should be sub 1) of 3, then a-b-c to the current 2 which should be 2) of 3. The current 3, 4 and 5 should be 3), 4) and 5) of 3.

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    1. KrasiFeb 10, 2016, 8:43:00 AM

      Theoretically yes, but I think this count has much lower probability.
      The panic lows are usually the lows for 3/C and test of the low with lower low and divergences is wave 5 (with higher low like August confirms reversal wave C).
      When I look at the indicators, market breadth and cycles I expect move higher not for 2-3 weeks rather than for 2-3 Months. I do not think this will be wave 4.
      I will not be surprised to see only corrective move higher, but I think it will last much longer than the most expect(the bearish sentiment should be purged) and this will be wave X not 4 with another zig-zag lower for the rest of 2016 and 7 year cycle low.

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  2. Steve NakamotoFeb 11, 2016, 2:17:00 AM

    According to your chart, it looks like the projected bottom is before Feb. 16th. So that would line up to be either Thursday the 11th or Friday the 12th, am I right? thanks. Nice charts. And good interpretations.

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    1. KrasiFeb 11, 2016, 6:44:00 AM

      On the intraday charts I do not pay much attention to time it is about the pattern.
      From my experience I would say the "big boys" make reversals always difficult to catch - Friday lower and gap on Monday, or Monday gap lower and reversal.
      So if this is wave 5 which should bottom soon we should see the price around 1800 and low on 12th or 15th.

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