Intermediate term view - too many ending patterns I think the indexes are close to an intermediate term top and correction should follow soon.
We saw small pullback and higher as expected.... looking at the charts we should see one more higher high, but too many indexes with finishing patterns suggesting intermediate term top around the corner. I wrote about VIX when it closed for the first time below 10. So far the indexes follow the scenario from 2006/2007 - VIX around and below 10 for more than two months with the indexes crawling slowly higher. This time is much more extreme the complacency compared to 1994/2007, but if history repeats the next move should be sharp correction for a few weeks. TECHNICAL PICTURE and ELLIOTT WAVES
Short term - it depends on where you put the bottom of wave 4 the pattern could be finished or one more higher high is needed. Looking at other indexes one more high will look better. As long as SP500 stays above the support zone around 2450 one more high is expected.
DJ - it needs one more higher high for really nice looking ED and top of the move since the April low.
Intermediate term - how I see the two possible counts. If we have iv of 3(green) I want to see any correction above 2320 and support at MA200(the next 18 month cycle running). If we have 4(red) I want to see a move below 2320 to the trend line, support and Fibo 38,2% retracement.
Long term - no change. We should see at least one more higher high for the bull market. RSI looks bad - it is more likely to see a correction before another significant move higher.
MARKET BREADTH INDICATORS
Market Breadth Indicators - showing a little bit more strength....
McClellan Oscillator - above zero.
McClellan Summation Index - buy signal with intermediate term divergence.
Weekly Stochastic of the Summation Index - buy signal.
Bullish Percentage - buy signal with divergence.
Percent of Stocks above MA50 - trying to move above 75... with divergences.
Fear Indicator VIX - extreme complacency much more extreme than 1994 or 2007 .
HURST CYCLES
Day 11 of the 40 day cycle.
Week 14 if this is the next 18 month cycle.
Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
On the daily chart we need a few more days to finish setup and a countdown from the last setup... which is in sync with EW short term counts.
Very exciting times Krasi! Volatility so low but will explode soon...
ReplyDeleteWhat do you think about QQQ?
Thanks again,
Kali
Indeed interesting times.... especially if this just iii of 3 than we have two moves lower and two moves higher the volatility and markets will go crazy while the topping process is lasting... who knows 6-9 months.
DeleteWave iv from the July low, one more high and wave 3 from the Feb.2016 should be finished.
Eventually we will get the correction you've been predicting for the past 6 months. A broken clock is right twice a day...
ReplyDeleteTroll
ReplyDeleteDo you think the peak has reached or? At least several days very short term hourly chart correction expected? And how about VIX? Thanks. It seems xbi QQQ has almost exhausted... And gold miner also has reached peak? What's your expectation about this topping process? Thanks.
ReplyDeleteWith the new high there is enough waves for a top. Some are counting the move from the 29.Jun bottom in this case we should see one more pullback and a high - then we should see a pullback 15-20 points.... I think it is more likely that this is the top.
DeleteIf history repeats we should see a correction bigger than 5%, but only for a few weeks then the indexes should bottom and turn higher again.
VIX it is too late to short it(play long XIV) huge risk for tiny profit.
XBI finished it is more, Nasdaq has 5 waves higher too like SP500.
Gold miners - corrective move higher since May.
Thanks, so XBI has finished last wave? Previously I wish it can reach 82.5 to 83. If nasdaq has 5 waves, how about QQQ? Suppose we have huge correction like 5% or more, how about gold miner?
DeleteYes, XBI looks finished. QQQ the same story like Nasdaq. Gold miners probably higher, but as a part of this big corrective move.
DeleteThanks for all the awesome work! Found your blog randomly when searching for cycles. Really appreciate all the effort.
ReplyDeleteI am glad to hear it:)
DeleteIf cycles are your favorite tool this is the place - http://forum.hurstcycles.com/
And if you are ready to spend some money the software is Sentient trader.