Short term view - wave b continuation next week.
Intermediate term view - the correction to continue for 4-6 weeks.
We saw one more low and short term bottom for the 40 day cycle - no surprises, but not clear pattern. I can not say - 100% we will see lower high.
DAX and Nasdaq look like final fifth wave higher with iv and v missing. XLF (last chart) is showing clear pattern now in b of B.
If SPX/DJ follow the same pattern like DAX / XLF / Nasdaq we should see (b) and (c) from b so I expect lower high for SPX.
TECHNICAL PICTURE and ELLIOTT WAVES
Short term - we have one leg higher which looks like an impulse so more to the upside expected. If it is wave b it should not move above the resistance zone and reverse sharply...
Intermediate term - the index needs more time for the histogram to reset. If we see higher high I do not think this will be the beginning of a new leg higher just (v) of iii or 3.
Long term - no change, waiting for the wave from Feb.2016 to be finished.
MARKET BREADTH INDICATORS
The Market Breadth Indicators - turned higher, but short term not like expect move up for months.
McClellan Oscillator - buy signal.
McClellan Summation Index - buy signal.
Weekly Stochastic of the Summation Index - in oversold territory, it should spend there several weeks.
Bullish Percentage - sell signal, but still above 70.
Percent of Stocks above MA50 - turned up in the middle of the range.
Fear Indicator VIX - continue making higher lows, the surprise will be to the downside for stocks.
40 day cycle low behind us and day 4 of the next and last 40 day cycle before 18 month cycle low.
Week 10 of the last 20 week cycle. Expecting to see an important top soon and 18 month cycle low first half of May.
Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
No price flip up, still sell signal and the histogram pointing lower.... no bullish signs despite the bullish candle.
I think XLF shows clear picture what is going on. Very clear waves and pattern, I will be very surprised if it does not find resistance at MA200 and reverses lower.