Short term view - higher on Tuesday dip lower the middle of the week than higher again.
Intermediate term view - final move higher in September and correction in October and first half of November.
One more week of the same crap. The market decided to extend the correction to a double zig-zag - one of the paths I have shown so no surprise.
The signs point higher for the next 2-3 weeks - after a correction move higher follows, 40 day cycle low and move higher expected, oscillators on the daily chart and McClellan Oscillator are expecting move higher, the indexes moved lower to MA50 on daily chart and reversed, TomDemark one final high needed to finish a countdown on the weekly chart... I think we should see a move higher in September.
The only way to count this as a bearish pattern is some kind of diagonal lower. In this case the indexes should reverse on Tuesday and plunge lower.
TECHNICAL PICTURE and ELLIOTT WAVES
Short term - price is back above MA50 and MA200, MACD/RSI broke above the down-sloping trend line we have a new move. We need a final confirmation on Tuesday - move above the high from Friday to confirm 5 waves impulse. If we see this I think wave 5 from the June bottom is running.
Intermediate term - one final test of the trend line expected with divergences on all indicators. Preferred pattern is that the final wave of the bull market is ED and wave 1 is finishing followed by 8%-10% correction wave 2(white).
Long term - no change, cool off and reset of the indicators expected.
MARKET BREADTH INDICATORS
The Market Breadth Indicators - the same like last week. We are in a correction for a few weeks and oscillators are pointing higher, but trend indicators need more to the downside so that they reset before the next big move higher. So higher, but limited upside potential.
McClellan Oscillator - several troughs with divergence, move higher expected.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal, but oversold levels.
Bullish Percentage - buy signal, no signs of a weakness.
Percent of Stocks above MA50 - in the middle of the range and turning higher.
Fear Indicator VIX - still at very low levels, waiting to see divergence or signs of a move higher.
Advance-Decline Issues - in the middle of the range and turning higher.
I think we have 40 day cycle low and the next 40 day cycle is running at day 2.
Week 10 of the second 20 week cycle...
Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
One final higher high to finish countdown on the weekly chart will look great:)