Intermediate term view - several weeks for the current move up to be finished and correction to around 2420.
I thought we will see a day or two higher to around 2525 and pullback, instead we saw extended wave. I do not know a way to predict if extended wave will appear or not, it is a rare event. The pattern has not changed and the analysis is the same. TECHNICAL PICTURE and ELLIOTT WAVES
Short term - the Fibo target for extended wave v of 3 is 2568 so probably we will see one more high before a pullback. As long as we do not see impulsive reversal below 2510 I expect just a pullback and one more high.
Intermediate term - almost every analysis I read expects important top in EW terms wave 3 with the April low as wave iv of 3. The problem is the move from the August low does not fit in the pattern.... so keep in mind that this could be just the top of wave iii of 3. The next decline will show what is going on. If it is wave iv expect a low around 2420 if it is wave 4 it should move below 2350.
Long term - no change, waiting for the top of the current leg higher then one more correction and a rally before the end of the bull market. Momentum is pointing up but building double divergences.
MARKET BREADTH INDICATORS
Market Breadth Indicators - positive, pointing higher, only the McClellan Oscillator with short term divergences and around zero. VIX and other sentiment indicators showing EXTREME complacency. Such conditions always end in the same way - sharp correction to burn the greedy traders.
McClellan Oscillator - with divergences and around zero. I think we will see oversold level around 60 with the pullback and bigger intermediate term divergences with the intermediate term top for the indexes.
McClellan Summation Index - buy signal and erased some divergences.
Weekly Stochastic of the Summation Index - buy signal.
Bullish Percentage - buy signal... with double divergence.
Percent of Stocks above MA50 - managed to reach overbought level, but overall weak.
Fear Indicator VIX - EXTREME complacency.
HURST CYCLES
Day 34 of the 40 day cycle. The expected pullback should be 40 day cycle low.
Week 7 of the 20 week cycle. The pullback should be half cycle low week 8 or 9.
Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Combo at 11 and countdown at 8. I think they will be finished with the expected one more high.
On the weekly chart we have sell setup at 6 the odds are very good to see finished setup too.
I am YK sir from HK, I think your previous analysis miss something, but the analysis in this post match with mine, and at the same time, in line with my prediction of China and HK mkt, both short, med and long term.
ReplyDeleteGreat job!
Thank you for the update. How about gold miners/PM? Still rebound up or has finished rebound? Thanks. And for SPX it looks topping to finish the small wave 3?
ReplyDeleteYes, SP500 is finishing wave 3 on the hourly chart, one final push is left.
DeletePM and miners look different. Gold miners finished corrective a-b-c higher either they continue lower or we will see more complex correction. Accurate short term forecast for corrective moves is not possible. The move lower looks impulsive and higher corrective which means there is more to the downside. This is all I can say.
Thanks. The confusion part is USDJPY looks also bearish and going down? Cleary its MACD has crossed. From previous top once it's doing down it would go directly jump and pass MA20...And gold is kind of going up from previous pattern. Its MACD has crossed up from the very bottom...
DeleteUSDJPY is going down, but it does not look impulsive some corrective crap. I think PM will move another week or two higher and turn lower again.
DeleteHi Krasi,
ReplyDeleteBeen looking at XBI. Turned lower but to me not impressed at all. Very tight range. In situations like this where it has started going down before the larger indices, would you think it’s just a wave down before a bounce up then c?
Thanks,
Kali
The last time I wrote I was expecting corrective move lower to around 86,50 and it is playing out. The next move should be up.
DeleteI have a general question about individual stock pickup. Do you think TA is useful for it? Or is there some trading methods to pick? For example, AMD, NVDA has increased a lot since the past two years, almost over ten times. How to pick and forecast such trend? Thanks. Some people think this individual stock pick is like lottery?
ReplyDeleteGenerally you can use the same tools with individual stocks - TA,EW,cycle etc.
DeleteIndividual stocks are more volatile, huge jumps around reports/news, more ugly patterns because they are traded by fewer people and the tools above rely on human emotions(you need a big enough sample).
With bigger companies is better, but they usually do not fly 10 times higher.
I do not know a way to forecast that a stock will go to the moon. I can say it will move up or down and some realistic targets, but that is all.
You can look at an index and say it will move higher. Then look at the components and pick 3-4 stocks with charts which looks promising and you think they can beat the index... that is all. You can build portfolio with 10-15 stock from different sectors.
I do not think trying to hit the jackpot is a good strategy. It might work it might not.
Learn to trade 1-2 things very good, bet on high probability patterns, with the time the account is growing and you earn more. The problem is you can not get rich fast, but at least it is realistic.