Sep 29, 2018

Weekly preview

Small move lower as expected, the analysis has not changed. Next few weeks should be interesting, the pattern should reveal itself - w4 or B or melt up. Next week bulls should pray the price to blast vertically higher or the melt up fantasy is gone.

Short term - so far another zig-zag which is consistent with the ED, which I am showing for a few weeks. Move below 2886 will negate it and wave4 is already running. I think we will see a small bounce higher, but I can not say if it will make new high or not.

Intermediate term - again preferred pattern waves 4 and 5, but B could not be excluded. We will wait and see how a move lower looks like - impulse or correction.

Long term - looking at the histogram(turned lower with small divergence) the move looks mature and ready to roll over. We still could see one more high(wave v of 5) and lower high the histogram with bigger divergence, but rally for a few months is very unlikely.

Market Breadth Indicators - turned lower, but price is not following so far. This means it is more likely to see just a correction wave4 and one final high than reversal and wave B.... unless price plunge heavily.
McClellan Oscillator - spending a lot of time below zero.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - another high and turn lower.
Percent of Stocks above MA50 - turned lower, around the middle of the range .
Fear Indicator VIX - turned up, expect multiple divergences before reversal.
Advance-Decline Issues - tested the broken trend line and turned down again, interesting is cumulative A/D is showing weakness for the first time.

Day 32 for the 40 day cycle, alternate we have 3 shorter cycles and this is day 14(yellow).

Week 13 of the 20 week cycle.


  1. Krasi... The ending diagonal of tour graphic is not valid.
    See you recount please.

    And see dj... No signals of bears in americans indexes.

    1. Very curious to hear why it is not a valid ED:)

  2. Sergio, the bears will appear very soon, in a week or two at the most. It will be the f wave of the diametric, objective 2680-2640
    Then a small rebound in g wave in failure and finally 2570-2590.
    And then wave 5 to 3100-3300

    1. What kind of tools are you using?
      This is interesting pattern... many are counting 1-2-3-4-5 from 2009, but I am starting to think the 4-5 which you are referring to will finish 3 from 2009 and after that we will see another 4-5 to finish the bull market.

    2. Yes, that is my main idea for the long term. A few months ago I thought the other option but today I prefer the option that you say.


    3. I use Neely's theory. This is my short term count. I think it's a diametric. I have adapted the pattern to classic elliot.
      It's not exactly like that, but I think you understand the idea.

      Regards, Manuel

  3. Yes Krasi, your long térm recount as possible.

    But i think other long térm recount.
    I revelated with dj (and s&p):
    My recount as in this time wave v of 3 of III of (V).
    In dj wave v finally in 28000-30000... And go correctión in wave 4 to minimun of febrary.
    The V wave of (V) go to 40000+-

    Next recession to 2026 (2024-2028).

    In this time, if dax no crash 11400 go up médium and long térm... Up up up (dax 20000+-???? With dj 40000???).

    I say in other posts +- this... Time of bulls with corrections 20%+-.

    No crazy traders buyers buyers buyers... No recession, no crash, no bears.
    Recession can go trump 2o mandated finish.

    Eurusd no go anual maximun to christmas, i equivocated.

    Brent go to 95+- zone i esperated.

    Lucky and bye.

    1. You remind me of another "expert" which explained me last year how DJ will go to 30k without correction - it did not work.
      You will be wrong too... look at simple indicators like RSI and market breadth then explain me buyers buyers.... in your fantasy.

  4. Buyers 30%, sellers 30%, neutrals 30% actually

    To recession, or crash, or big corrections necessary 50% of more of bulls while weeks.

    20-25% correctión ok... No more actually.
    But in short térm up.

  5. It looks so strange that some index has already went down too much while some index still not yet topping... Highly appreciate your ideas, thanks.

    1. This is typical for tops... usually it is a process lasting for months and different indexes make a top at different time.
      Fear is much stronger than greed that is why usually the bottoms are quick (sell off and reversal) and most of indexes make a bottom at the same time.

  6. A crash in TLT (price of bonds) might be in the very near term(today it broke trend line of support)....What implications do you foresee in the equity market?

    1. Usually bonds and stocks make important lows/highs at the same time.
      Bonds are heading for 2 year cycle low and multi month move up, stocks are heading for important high and correction bigger than 10%.

  7. Finally it’s happening Krasi. I have been short for a while and getting more and more nervous. With your previous comment about bonds significant move down would expect larger drop in stock indices? More like C wave to test February lows? Thanks. Kris

    1. For both stocks and bonds waves 4 and 5 can not be ruled out at this stage.... so one more high(stocks) is possible. We have to wait and see how the decline plays out.

  8. ciao krasi , e' possibile ?

    1. If I count it this wait it will be a zig-zag rather than an impulse.... waves 1 and 3 a zig-zag and not impulses.

  9. At this point it’s rather confirmed there will be no new high at this point. What’s your minimum measure to the downside on Spx? Thank you Krasi

    1. The considerations why one more high is possible:
      - this plunge occurs above MA50
      - market breadth (McClellan indicators) in corrective mode for a very long time and price following at late stages. This occurs usually with corrections.
      Of course reversal is possible, but I want to see an impulse to at least 2800 or lower.
      At the moment I can not say if this is 1 or a. If this is correction b and c to 2840-2850. If it is a reversal impulse below 2800.

  10. This Market will be over 3000 by December just my opinion

    1. It is possible, but as I said the indexes will move lower before moving higher.
      And they are not so bullish as the most traders think.