Intermediate term view - near to the top of wave 3 from Feb.2016.
The sideway pattern resolved higher which is not a big surprises because one more rally and reversal pattern was missing. Now the pattern looks like finished 5 waves on multiple degrees. My count is the top of wave 3 from Feb.2016 with extended fifth wave(see long term update). In this case wave 5(414 points) should have the same size like wave 1 to 3(409 points). This was met this week. So either we see a topping next week and first signs of reversal.... or I do not know what pattern we have:) Europe looks like almost finished huge expanded flat for wave B and should turn lower too. TomDemark finished sequential on daily/weekly/monthly all time frames aligned. Weekly RSI on crazy 85+, daily RSI overbought again makes a third peak. On the positive side market breadth looks strong. Curious how it will play out - I think we will see a topping for 2-3 weeks and a few false starts, but lower eventually. TECHNICAL PICTURE and ELLIOTT WAVES
Short term - in the last weekly post the last wave 5 was missing - this week we saw it.... I do not know how to extend the pattern with more impulses higher.
Intermediate term - in the final stage of wave 3. Overshooting the upper trend line and RSI double divergence does not look very bullish. Now waiting to see what happens.
Long term - one more correction and a rally before turning very bearish. The next wave lower will show us if the move from the Feb.2016 is over or not. I think it is not.
MARKET BREADTH INDICATORS
Market Breadth Indicators - some are showing strength other like McClellan indicators are weak. No reversal signal so far. I suppose topping and initial move lower with very deep retracement.
McClellan Oscillator - above zero , but no strength and double divergence.
McClellan Summation Index - buy signal, but is not following the price with strong move up.
Weekly Stochastic of the Summation Index - buy signal, in overbought territory .
Bullish Percentage - buy signal, very strong.
Percent of Stocks above MA50 - havering around 75 and yesterday some strength.
Advance-Decline Issues - weak making a lower high.
Fear Indicator VIX - notice how it reaches a low and stays there for 3 months followed by a spike higher. We are at the next lower low valley lasting 3 months already. I think the next spike higher is around the corner and it will make higher high breaking out of the wedge.
HURST CYCLES
Day 34 of the 40 day cycle, a little bit extended.
Week 7 of the 20 week cycle.
Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Finished countdown/combo on the daily chart. Now all time frames are aligned with finished patterns daily/weekly/monthly. In the next few weeks we will see how important is this signal.
Krasi, great work! thank you. H
ReplyDeleteThanks Krasi,,, Beautiful as usual... Appreciate your time for sharing with us :)
ReplyDeleteHi Krasi,
ReplyDeleteWhat do you think of soxx and xbi?
Thanks,
Kali
SOXX the last decline look like an impulse, but the retracement is sooooo close to invalidate it.
DeleteWe have to wait a few days to see what happens... it is the same story like SPX either finished zig-zag(SPX wave v of 5 of 3 see hourly chart) or the impulse will be invalidated and we have some nested 1-2 i-ii (i) (ii) (see SPX the new post).
XBI similar story - zig-zag lower and higher so either wave B of a flat correction or the move will continue higher... ED?
It’s so interesting. Ibb looks like an impulse but xbi looks like abc corrective pattern. I thought yesterday’s drop confirmed resumption of down turn. Guess we shall see.
DeleteI am looking for soxx as possible short at prior high as entry point and break above as exit.
Thanks Krasi,
Kali