Intermediate term view - the odds are very high that the move from the August low is over and probably this is the top of wave 3 from the Feb.2016 low. I expect lower for a few weeks and 40 week cycle low around mid December.
SP500 levitated for another three days, but broke lower as expected. In the last 5 weeks we saw two EDs lasting two weeks each. The index gained 1,5% for this time.... this does not look like strong bullish action more like exhaustion. The signs are not very good for the bulls - EW two EDs in a row, the indicators spent the time building divergences and not resetting lower, market breadth is bearish, the new 40 day cycle made higher high as expected but with 1/3 behind us instead to be the strongest part all we see is marginal high and sideway move, TomDemark finished sell setup on the weekly chart. I can not present bullish arguments at the moment.... except faith - the market will always move higher and never correct. This does not mean the indexes will crash and burn just purge some greed. Short term we have MA50 support on the daily chart and in a few weeks 40 week cycle low sometimes in December. TECHNICAL PICTURE and ELLIOTT WAVES
Short term - looking at the daily indicators and the 40 day cycle with 1/3 behind us another high unlikely. The European indexes already with impulse lower the US indexes still need to confirm a reversal, but I think they will move lower .
Intermediate term - another finished ED and RSI/MACD divergences. The move from the August low should be over.
Long term - no change, one more correction and a rally. For now the plan is that this is the high of wave 3 from the Feb.2016 low. When we see the move lower we will know if this is the right pattern.
MARKET BREADTH INDICATORS
Market Breadth Indicators - look bearish, pointing lower, with sell signals since last week.
McClellan Oscillator - spending a lot of time below zero already.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - sell signal with small divergence and below MA10, but still above 70.
Percent of Stocks above MA50 - sell signal below 75.
Fear Indicator VIX - extreme complacency again, double bottom?
Advance-Decline Issues - cumulative A/D with divergence and pointing lower.
HURST CYCLES
Day 12 of the 40 day cycle. On Friday SP500 closed below MA10 and the trend line, which means the odds are higher that the current 40 day cycle made a top and turned lower.
Week 12 of the 20 week cycle. It should turn lower for 2-4 weeks. Average length is 14-18 weeks. With the previous one 18 weeks long a shorter one 16 weeks will look better. This means mid December and time for Christmas rally:)
Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
We a have a finished sell setup on the weekly chart, but no price flip so far. For the next week price flip is a close below 2575.
It seems SPX may still plunge in next few days? But XBI looks like some hourly chart bottom? How can they exist together, i.e. SPX down move while xbi moves up? And what's the backtest point? MA200 or 85.2? Thanks.
ReplyDeleteU waste time! Krasi not know. Krasi say XBI go up. Now down more. He not know! HAHAHA.
DeleteXBI is moving lower since sixth of October while SPX was still moving up... so I would not look for such strong correlation on the hourly chart.
DeleteThe next low for SPX should be in several days... something between 20-30 lower is not really a plunge. Then the top should be tested, even higher high is possible, after that expect bigger decline.
IBB shows more clear picture impulse testing MA200 with RSI divergence on the daily chart, which means to expect retracement higher.
So if I would search for corelation it will be to see Biotech and SPX retrace higher and making a top at the same time.
HAHAHAHA
ReplyDeleteAgain with falling!
I make even more money. I keep making more money when Krasi say go down. I buy more. Then Krasi wrong again. How many weeks pullback pullback pullback? I make money all these weeks and wait for more krasi say pullback. I read here to know when krasi say no more pullback, then I sell. You now see what I do? HAHAHA
So keep watching my money bag get bigger!!! you wait for pullback!!! HAHAHAHA
Learn how to speak English. Krasi's analysis is very good. I agree with him. I loaded up on puts and am very short the market (as of Monday's close). We'll see what happens tomorrow.
DeleteDo not pay him attention... the sheeple gone wild:) It is not only on my blog. They are now well trained like Pavlov's dog buying every 2 points dip:)))
DeleteI leave the comments deliberately, the more he writes, the more he convinces himself how smart he is, the harder he will fall.
I always try to help, but the guy is extremely arrogant blinded buy stupidity and greed so I will watch the show. Side effect is toping lasts for months so we will need to listen him for months, but the show is worth watching:)
HAHAHA!
DeleteI make money. U watch for drop. I make more money. U watch more for drop. Drop tomorrow! Drop tomorrow say Krasi. No drop! Now if Dow drop 20%, I still up! U wait and watch for drop! Now Krasi change mind say it goes up then I sell! HAHAHA. You best used for opposite! I not arrogant. U arrogant! U tell people wrong. I tell people right. I not arrogant. I try help poor people think drop drop that never here!
HAHAHA I mr moneybag. U see drop? I buy. So easy. Just buy!!
HI Krasi,
ReplyDeleteAppreciate your insight. Please block the individual above.
What is your view on QQQ?
Thanks again,
Kali
The indexes do not look neither bearish nor bullish. I see two options:
Delete- one more leg lower for wave C followed by marginal higher high
- diagonal and deep retracement before a bigger decline
This is a normal price behavior after a strong move the top is being tested.
Time fits too - weak 40 day cycle, the low what it comes C or diagonal is a mid cycle low around day 20 one more peak and 2-3 weeks lower.
Hi Krasi,
DeleteI was thinking about the process of topping. What do you think of the theory that market should move up about the same amount of time as it drops or trends side ways?
- Kali
If you mean Laundry's T-theory it works good.
DeleteHi Krasi,
ReplyDeleteThanks for the hard work. Could you comment on crude oil and HSI? Many thanks.
-HF
HSI looks like the top of iii of 3 so two corrections and two higher highs expected to finish the pattern.
DeleteCrude oil has a difficult pattern... I think we have ugly triangle wave a up from the triangle, now wave b lower and one more rally higher for wave c to finish the pattern from the 2016 low.
Many thanks. Appreciate it!
Delete