Mar 23, 2019

Weekly preview

One more rally as expected, which corresponds to the expanding ED shown last week and sharp reversal. So now we have the minimum waves needed for finished pattern and the reversal is not a surprise. The cycles suggest that the 20 week cycle turned lower and we should see roughly 3 weeks lower. Market breadth was already negative in the last two weeks with divergences, TomDemark sell setup on the weekly chart.... so expect the indexes moving lower for a few weeks.
Possible EW patterns - finished B wave or alternate expanding flat correction(not my favorite). Impulse lower in both cases, the only difference between the two patterns is how deep the retracement will be. For a flat in the range 2680-2700 for B and reversal minimum 38% retracement.

Short term - now we have possible finished pattern wave B(white), but expanding flat correction for b(red) can not be excluded. Minimum expected is an impulse lower to support around 2680.

Intermediate term - pullback from the first resistance, then the second one tested and sharp reversal. The indicators with divergences so I expect lower for a few weeks than we will assess the pattern again. I still think this is corrective wave B/X what ever... I can not see an impulse.

Long term - wave B running for IV from 2009. If I am wrong it is an impulse wave 1.

Market Breadth Indicators - divergences and now with sell signals.
McClellan Oscillator - below zero.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - divergence and sell signal.
Percent of Stocks above MA50 - divergence and sell signal.
Fear Indicator VIX - bounced from the trend line connecting the important lows in 2018 and turned higher.
Advance-Decline Issues - bigger divergence and turned lower.

Day 10 for the current daily cycle.
Sharp reversal closing below the previous day low and MA10 which means high probability that the daily cycle turned lower.
Overall text book cycle behavior - the first one very strong, the second one weaker and the third one left translated failed cycle to signal the cycle of higher degree turned lower.

Week 13 for the 20 week cycle. Again both models with shorter and longer 18 month cycles.
Shorter 18 month cycles - if we have wave B the last 40 week cycle is running. In April we should see 20 week cycle low wave 1/C bounce up a few weeks 2/C and then lower July/August 3-4-5/C for 4 year cycle low.

Longer 18 month cycles - the only way I see for this count to work is if we have complex W-X-Y pattern. In this case we should see 20 week cycle low in April and another higher high for a-b-c/X. Another option is huge flat and instead X it is B, but then c/B should take another 2 months at least and C lower should move "slowly" instead of 2-3 months something like 5-6 months.


  1. Thank you very much Krasi. I do not understand a thing. If December 2018 was 40 week cycle low, the next 40 week cycle low should be in September-October 2019.

    1. 40 week is the nominal model, just a reference. Different assets have different lenght of the cycle.
      For the US indexes the length of this cycle is usually between 30-36 weeks or 7-8 months or July-August.

  2. DJIA has not made a new high... now I looked at BA(10% weight in the index) and it should retrace for a week in wave 2 and reset the oversold indicators. This could lift the DJ and make slightly higher high to finish the pattern. Probably the SP500 will follow with deep retracement... or even higher high. Than he pattern will be simple ED and not expanding. I hope this will play out. It will be great short entry.
    Everybody will be convinced that the market can not go down and the trolls will say I was wrong again:)

    1. Do you mean that the movement on Friday was 4 and the next week it will be 5 of ED around 2880 in the sp500?

    2. If we see one more high - yes. We have overlapping waves and corrective waves for ED.
      If the bulls can make another impressive return like 2 weeks ago - I can not say.

  3. New dow highs by Friday with a lower high on spx looking good . Tech now lagging as that pattern looks complete - good spot Krasi far so good.


  4. Hi Krasi,

    What’s your view on 10 year US treasuries?


    1. One more high early April should complete impulse from the October.2018 low.
      Correction for 2-3 months and another leg higher.

    2. Krasi when you say one more Hi how Hi

  5. Hi Krasi and all ! Is there something we can do to improve the accuracy of these predictions ? I don't want to criticize but Krasi's predictions have been really atrocious lately, I'm sure he's embarassed. I just want to know what went wrong and what Krasi can do to improve his technical analysis skills.
    It's really been an awful period for Krasi, almost disgusting in terms of accuracy to be quite honest.
    Thank you

    1. Do you read at all - the third comment and the last update.
      Two weeks ahead new high and this is "atrocious" forecast:)))) The trolls getting arrogant every day with clear lies now:)))) Definitely the top is close. Exactly the same bullshit like last year September - trying to find the top, but no I am so wrong give up 3000-3200. I can only laugh at such amateurs like you. The idea that I should have some feeling because of wrong prediction is embarrassing typical for amateurs.

      Embarrassing are the sheeple like you getting bullish at the top over and over again learning nothing.