May 30, 2020

Weekly preview

From time perspective a few more days higher were needed for the daily cycle - we have it. The pattern is more complicated story.
The big picture is getting more clear - it is not an impulse one wave too much, this wave too much can not be justified as b/B expanded flat anymore - b is too big, a-b-c does not work for many indexes and there is no impulse for c, what is left - w-x-y.
Short term is a messy story - first from the low 14.May the move looks corrective, and on top of this from the minor low 22.May it is corrective too. The best I can come up with is shown below on the short term charts.

Overall look at the markets - even the weakest index XLF rallied like a magic 10% for two days to synchronize the pattern with all the other indexes, the USD spiking lower to complete a-b-c, crude oil spiking higher to complete most likely impulse, silver spiking higher to complete impulse c for a-b-c, TLT(bonds) is ready for another run higher.
All markets and indexes are aligned now, I do not think June will be a good month.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - w-x-y fits best and currently in the middle of c/Y. NYSE/DJ/NDX with more clear patterns shown below.

NYSE/DJ have similar pattern. I think we have a-b-c with c as ED for c=a. Predicting ED often fails, when you have not seen waves 3 and 4, but all this corrective waves this is the best I can see. The other options are to count triangle or bigger ED 1/C.

NDX - similar pattern, short term you have zig-zag lower and now clear corrective move up so either ED or triangle. I would bet it is rather ED to complete the pattern, test the upper trend line of the wedge and the high from February.
Around the low I was explaining that the wave in 2019-2020 is X wave what follows is another corrective pattern which are - flat, zig-zag or triangle. I said repeating March two more times for a flat looks crazy, but there you have it for the NDX.
I wanted to explain this in the long term update - crazy is the new normal and we have to adjust. If you accept this you will see how all tools TA,EW,cycle continue to work so beautiful:) or you can continue to live in the old and dead "world of normal trading" thinking because a move is strong it is an impulse and no way it will move in the opposite direction - neither 2019/2020 rally nor the March sell off nor the current move are impulses all corrective moves. The new normal will continue for a decade it is just warming up. Open your mind and your eyes if you do not want to be left behind... by the way buy and hold is dead, died in January 2018, learn to trade.


Intermediate term - the next gap closed and the next resistance hit, MA200 tested. Now waiting to see completed pattern and reversal signature.


Long term - now this leg up should be close to completing and I expect the final sell off to complete the correction from 2018.


MARKET BREADTH INDICATORS
Market Breadth Indicators - finally some are showing strength like A/D line(not cumulative) - it broke above the previous high which means the next low is a buy and there is no third wave lower, there is no bear market... good to see confirmation. Overall pointing up no sell signal some with divergence.
McClellan Oscillator - another lower high - time for correction.
McClellan Summation Index - buy signal.
Weekly Stochastic of the Summation Index - overbought level for a few weeks next it should turn lower for several weeks.
Bullish Percentage - double divergence.
Percent of Stocks above MA50 - strong above 90.
Fear Indicator VIX - not impressed with the rally at all, still higher low. We should see another spike higher with lower high to mark the end of the correction.
Advance-Decline Issues - finally higher high breaking the trend. This means the next low is the low for the correction and strong buy.


HURST CYCLES
Daily(trading) cycle - the signal is buy, and we have 10 day low either on Friday last week or Wednesday this week. At the moment close below 2970 will trigger sell signal. Again my expectation is this cycle to fail as left translated.


Hurst cycles day - adjusted the upper sine wave, now it fits much better with the highs. Next we should see a high in a few days, I suspect this will be the 20w high and decline into 20day low should follow.


Week 17 for the 20w cycle. Alternate March was 20w low with longer cycle 25 weeks and now we should see shorter one like 15 weeks. In fact this counts better, but the outcome is not any different just labeling 17+22 or 25+15 weeks.
High-to-high count week 19 so we should see 20w high soon.

152 comments:

  1. Have you increased your shorts or puts? Or still at 1/3?

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    1. No, another short only when we see some kind of confirmation.
      In fact I bought long volatility ETF which is dooming fine because VIX is diverging.

      Delete
  2. Krasi,
    Thank you , waited for this update.

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  3. Thank you Krasi for the update: about Oil doyou think has reached its maximum and now it can start to go down?

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    1. Now it starting to take shape and it looks like impulse with 4 as a flat or triangle - https://invst.ly/qzbwr
      Last time I wrote it will look better with one more up for fifth wave - so far this fifth wave is too short so it should take more time and price.

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  4. Krasi thanks for update. Always look forward to them.

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  5. I see a count more clear, march A, June B and next C to 1800 for a flat with A=C.
    1800 (february 2016) is sub 4 de III, so IV will go to that zone.

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    1. It is possible just the labeling should be w-x-y because we do not have 90% retracement for a flat.

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  6. Krasi
    What is your estimate for S and P 500 by year end.....December 31,2020?
    Thanks

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    Replies
    1. This is a difficult forecast I would say in the 2700-2900 area.

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    2. Oh I thought the scenario was W shape after a retest of March low? Is it not new ATH in 2021?

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    3. It will happen, but not with the same speed as the last two months. Plus in October is the next important high 40 weeks so it should decline in November... maybe a week or two in December.

      The question is where it will be the end of December - roughly 1000 points to 2900-3100, retracement 38% and something higher a few weeks in December - best guess the congestion zone 2700-2900.

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  7. it is a very difficult forecast.....I just wanted your opinion thank you

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  8. A flat is with a retracement of 62% o more. It is not necessary 90%

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    1. I found it according Neely there is a flat with B wave failure.

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  9. so Longterm you expect lower low than March lows? Around 2100? short term seems to be consistent with market timing update blog that I follow. Studycycles blog is confusing me big time with shortterm.

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    1. Yes, one final lower low. With targets is difficult - such corrective waves do not have exact Fibo measurements only guidelines. For example the discussed flat above target for C is somewhere between 100% and 138% of wave B, which means somewhere between 2200 and 1900.

      Studycycles is trying to justify somehow B wave and triangle is the last chance.

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    2. Krasi, I follow chart pattern trader and he's expecting a short bear market, and the bear market low to be around 1700.

      Is this possible with your pattern?

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    3. That is too low. The worst I see is another leg with the same size currently this is around 1850.

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    4. what time frame for this drop?

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  10. For DJ you can count simple a-b-c - https://invst.ly/qzj-t
    SP500 is more messy because of the tech stocks just FAAMG have 20%+ weight. It looks like a mix between DJ and NDX.

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  11. Shame im not in Bulgaria id bet you a beer we only drop 10%, love your work, really appreciated!!

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    1. Ready to fly to Bulgaria this year-end, if you are too. Let's have a beer with Krasi and MTM 2020. :)
      I'd take the other side of 10% drop this year from current levels any day.

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  12. can you explain the comment of Advance-Decline Issues ? Why is strong buy?

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    1. I am watching MA5 of A/D issues to smooth it. I have noticed that it makes higher lows(up) lower highs(down) and when it is time for a trend change it gives early warning breaking this sequence with lower low/higher high then price makes its final move up/down.
      Now we have higher high moving to overbought level so this is another confirmation for me that there is no third wave lower bear market etc.

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    2. No third wave lower bear market ?

      Do you have updates chart?

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    3. Nothing to update, because nothing has changed. This third wave, bear market is not my analysis.

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  13. Krasi, from cycle view, when do you think we have to start the sell of?

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  14. A lot of mess lately - https://invst.ly/q-f86
    It looks like we are in the middle of a third zig-zag higher.
    We have wave a and b as a triangle, next we should see spike higher to compete this third zig-zag and the whole move from mid-May.
    Even if this is just B lower it should drop 350 points very quickly.

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    1. would the mess be attributed to the Fed? Pajama Traders?

      Higher it goes, the faster & farther the fall?

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    2. This mess is short term and means nothing.
      Higher it goes, the faster & farther the fall? - this is FED's fault for sure.

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  15. I think you should reassess your long-term count. The unemployment has been the highest since the great depression. There are bankruptcies every week and the wave of foreclosures/evictions hasn't even started. A SPX drop of 30% over a period of 6 months with what is going to be one of the worst recessions is unheard of. This is not the 4th wave. I believe the market topped in March and we won't bottom until next year with SPX less than 1600. Elliott wave does reflect reality and is not in a vacuum, which is why the market dropped 90% during the great depression, etc.

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    1. This is mine long term and preferred count, perfect 2.61 fibo ext, alternation rule met, rsi trendline broken with lower low etc) I may be wrong and this is over
      https://www.tradingview.com/x/J30i6LrT/
      Regards
      Mily

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    2. Even if I revise my count with a top in 2018, still we will see one more high. The high 2020 means nothing there is no top with three waves.
      The last time I heard EW does not work because fundamentals was a few months ago - how did this worked out? You can not trade fundamentals and I could not care less about fundamentals.

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  16. Krasi target for uvxy 70 looks doable?

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  17. It looks like it start today, we have to see at the end of the day, inverted candle

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    1. It still could be the the ED from the second chart NYSE - now 4 of the ED running.
      We have to wait and see big red candle is needed to confirm reversal.

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    2. In nyse y sp yes, but dji not, still 3

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    3. Aapl also looks like it wants one more up.

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    4. Real mess this should be ED. Now we know why DJ is lagging - it is still wave 3 of potential ED.

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  18. The path of most pain is keep squeezing higher for a couple of weeks before sharp 10% fall....

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  19. So we are not going down today or tomorrow?

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  20. Don't you think we are in wave 3 of W5 of the w1?

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  21. "Lady S," I am pretty sure that Krasi's blog was not created to serve as your personal trading advisor / fortune teller. Please do your own work/evaluation and trading decisions. Thanks.

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  22. That what I am doing, I am just asking him, you are not his mouth

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    1. Then I will remind you of HIS words of May 18, 2020 at 3:04:00PM to YOU - "The same over and over, please spare me the bullshit." My thoughts exactly, but from HIS mouth. How's that?

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  23. Very ugly, it's not your site

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  24. You are not krasi and I didn't ask you so, don't answer me, I asked krasi, I aprichiat him and his work

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  25. The trolls are resurfacing as usual, and that is reassuring!

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    1. Trolls don't use their actual name as I have, but you are welcome to your opinion. If you see the quote above from Krasi himself, you'll see that she ignores the many admonishments from participants here to her constant badgering of Krasi. I appreciate and respect his work and blog by reading, listening, and posting with discretion, and for most of the posters here, they do as well. Krasi will tire of the badgering at some point, and hopefully block her to preserve his sanity. Enough said.

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  26. Dax and SP generated a few days ago a "bonita de estocasticos" in daily, this is very bullish.
    Until this is over, it won't even be time for short trades. More info in:
    https://analisisbolsa.com/la-pregunta-del-viernes-se-contesto-el-viernes/
    https://analisisbolsa.com/el-ritmo-no-para-y-mientras-no-pare-sigue-como-la-vida-igual/

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    1. I will be glad to take the short trade in a few days:)

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  27. I prefer to wait. The "bonitas" work very well. When it is over I'll go short, while be careful with the shorts

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    1. When I see the NDX and SP500 I can tell you clear corrective bullshit and there is no "bonita de estocasticos" , which will save them. Best case to complete the ending diagonal - the name says it all ending.

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  28. Krasi, so you mean the ED is complete in S$P?
    And we have to start the sell of, or you wait for wave 4 and 5?

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    1. No the ED is not complete.

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    2. can you post an updated chart?

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    3. Nothing much to show it is not ED any more... it is some corrective mess in very tight channel - https://invst.ly/r0716

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    4. The NDX wedge even more tight now - https://invst.ly/r075q
      Break lower is imminent now....

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  29. vix has canceled the divergence

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    1. And nyad cummulative has almost made new high, sp will also make it

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  30. looking like a top today. SPX has closed in on March pivot and 78.6% retracement.

    imo the easy part is over, the hard part is forecasting how this will fall and how far.

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    1. Yes, there is probability for a high today.
      My opinion is clear - new lows. NDX points to a decline with impulse.

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    2. are you adding more to short here?

      Or still waiting?

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    3. No, confirmation is needed. Patience and discipline....

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    4. 3150 then 8-10% drop. This looks like a C wave ending, not B

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    5. The B has died. This is the second leg higher from a corrective move which started in March.
      The shape is very similar to the rally 2019/2020, I do not see any difference - two legs higher with long and shallow middle section.

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    6. Looking the short term charts like 5m... best guess at the moment this is the top of 3/c waiting for w4 to measure the final fifth, but yes around 3150 or 5-10 points lower.

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    7. There's another optional sequence that takes the S&P to the 3215 area before the large decline. Anything above the 3215 area before a substantial decline will make things confusing for me

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  31. Now after the ED is negated trying to make sense of this mess - https://imgur.com/a/hRyhrKf
    I would say DJ looks like running correction, for SP500 running triangle.
    Most of the time RSI reveals the pattern even if it is difficult to see it. Look at what it shows - zigzag lower , zig-zag up and probably impulse lower to complete b wave(on the wrong place it should be at the low on the trend line).

    It is normal to expect ED for c when it starts with a zig-zag... this running corrections are rare.

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  32. Feel like now the FOMO investors are getting in on this... but people will get caught on the wrong side of this just like earlier this year..

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  33. https://www.youtube.com/watch?v=kQDfQYDyVgY.
    He is expecting lows around 2nd week of August. Ofcourse timing exactly is never easy nor accurate. But definitely I watch his viewpoint carefully.

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    1. July is more likely. After longer 20w cycle shorter one follows plus the pattern says more likely quick moving wave impulse.

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  34. More likely we bottom End of June beginning of July. These waves cycles are surprisingly similar to the waves of coronavirus. We are due for a spike of CV cases as states reopen.

    I think the Coronavirus dies out in July based off medical knowledge.

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    Replies
    1. It is all about the mood of the masses. In February/March when all begun with this virus I told my wife in June/July it will be over - because of the cycles.
      This cycles are not stocks cycle I would say they reflect what is going around us and this influence the human behavior and the index patterns.

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  35. Looked like a top, felt like a top. Probably not a top :)

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  36. But funny apple amzn fb shop cmg and few others not going up much.. looks like others catching up and falling in line..

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    Replies
    1. Exactly this is happening all the leaders are just waiting for all the other to synchronize the pattern.

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  37. Timing perspective - the last two weeks considering alternate March as 20w low. With the price action this week it looks confirmed. I expect the current 20w cycle to be shorter like 15-16 weeks because the previous one was longer. The 10w cycle was shorter 7,5 weeks - this long sideways move till mid May.
    Strong move up especially emerging and European markets - right on schedule and exactly what you want to see for 20w cycle high.

    Short term - the pullback should be 20d low most likely 4/c/y the next 20d cycle should make higher high to complete the pattern 5/c/y and turn lower as a left translated cycle.


    5 weeks lower for A, 11 weeks up B and 5 weeks lower C - usually you have one long wave and the time for other two waves is in some relation to it - the same time or Fibo number. This is not a hard rule it is a roughly time estimation for corrections.

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  38. C=(a+b)/2, so C should last 8 weeks according wave theory from Neely

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  39. Sentienttrader thinks march was 4 years low with 40w low in August instead of october

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    1. He is showing two options. I use EW and the first one does not make sense so for me it is clearly the second one.

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  40. Krasi, any thoughts on this as weekly high ending by tomorrow and sharp reversal for the next couple of weeks

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    1. If we see higher high with divergence maybe.... I can not see completed pattern at the moment.
      It is very difficult, I am struggling to see some pattern in the first place.

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    2. are you flat now or still short?:

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    3. I am long volatility, waiting for shorting the indexes.

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  41. If march was 20 week low then february was 20 week high, so we are still in week 15, there are still 2-3 weeks of going up

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    1. For me the high is in January not February.

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  42. SPX prints a daily doji / spinning top today. A potential short-term reversal indicator - to be seen if there is follow-through tomorrow to end the week.

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    1. Patience, only corrective move as expected.

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    2. Thanks for the wise reminder, Krasi. This reaction upward has been like waiting for water to boil.

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  43. NDX the wedge from the last time even more tight with a few more touches of the lower and upper trend lines really crazy - https://invst.ly/r0xnu
    Will we see one more high for perfection:) or not is the question.

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    Replies
    1. More hits down and up and now the upper boundary and the previous top from February hit, lets see if the perfection continues and the wedge breaks lower.

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  44. You've got just now one more high in the S&P

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  45. There is no divergences in rsi or vix, I dont see a top, it is not still like february

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  46. Good morning Krasi, please can you leave a comment on Brent? Now it is at 40,70 and do you think it is time for the downside or another up? In case of the downside what is according to your analysis the target of the retracement? Thanks for the answer

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    1. It looks like the final spike higher. I think at least 50% retracement.

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  47. The sheep are following for the slaughter cnbc everything's great lol

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  48. Replies
    1. Now we have the full set of waves and watching what happens.

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  49. Not sure if there any bears anymore. Sentiment is extreme now. I heard the P/C ratio was the lowest it's ever been yesterday, can't imagine what it is today

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  50. Yep, going to 3218 where the VPOC is

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  51. The entire move from Feb 27 till now looks like an expanded flat.

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  52. So, they are going to 3400 in the S&P?

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  53. the eur/usd made lows of this year?

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  54. Exhaustion was missing, I think you'd expect to see gap up with a reversal candle, we'll find out today

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  55. Now there is completed five waves on the 5min chart with divergence for those who want to try short - I am one of them:) small of course another 1/3

    Most of the indexes with completed Fibonacci measurements like a=c/y and y=0,618xw... curios what happens for the rest of the day.

    EUR/USD looks complete two legs up with the same size and triangle in the middle, PM is declining already, oil should be topping too.

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    Replies
    1. But the eur/usd is going to make new lows this month or the next one? or we have already seen the lows for this year?

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    2. We should final decline into the 1.03-1.05 area.

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  56. no sign of a reversal. We might get to ATH today. Lol.

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  57. Thanks
    Do you think we are going to see a new low, or 2200 again?

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    Replies
    1. If Krasi knew, would he go just 1/3? :)

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    2. Yes, I think.... which does not mean I should go full in:)

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  58. Go to shit Krasi, go to shit

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    Replies
    1. Here we go again - emotionally unstable guys showing up again. This should be the top:)

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  59. I think we will fill the gap of the 24 of february in the sp and in the vix

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  60. Q's looks like ending diagonal? thanks Krasi

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    Replies
    1. The wedge and the ED look complete. Now is only waiting, if it will be confirmed or not

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    2. The volume on this "Blue Skies" jump up is TINY.

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  61. Do we go down in 3 waves or 5?

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    1. It looks like a flat from February so it should be in 5 waves when it turns lower.

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    2. Thanks. Thought so too. THe scary thing is that means we can head higher to complete 100% retracement for B wave

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  62. No, one up wave.

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  63. if the squeeze this into the close with shorts covering , it could be quite a last hour

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  64. 140 comments - we're getting close to a top!

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  65. Can anyone here confirm what my Stockcharts.com screen is giving me for volume for $COMPQ so far today - 5.1M??? This is less than one-tenth the volume that printed yesterday. Thanks.

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  66. It is 3 of c of B

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    1. I wish it was so simple... the supposed w2 is only 23% retracement, the supposed third wave breaks the trend line connecting the beginning of the move and w2, not to mention the middle section is.... something. RUT where is the second wave in the first place.

      I really wish it was so simple... but it is not.

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  67. I've been following this site for over a year now. I see what Lady S writes every week and can see what part of the problem is. Keep in mind that this is a free site and Krasi is not profiting from his work in any way. Each week I look forward to seeing the charts especially the short and intermediate term ones. I have little regard for the others and think that Krasi could save himself the trouble of having to post these other charts.

    Joe Granville, the stock market guru on the 1980s, use to advise against "falling in love" with stock market scenarios. And the weekly short-term chart creates that type of scenario. I think that Lady S and others "falling in love" with the short-term and intermediate forecasts and end up being disappointed.

    It might be wiser to take these forecasts with a grain of salt and realize that they are projections based on the things that Krasi studies. But the probability of these scenarios panning out should never be assumed to be accurate. The truth is nobody really knows.

    If this is the only site that you follow, you are being unwise. This is just one person's perspective no matter how well-thought out it is.

    I am grateful for Krasi's work, but realize that the scenarios may not end up being accurate. That's just the reality of this all.

    No one could have forecasted all of this.

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    Replies
    1. I think overall there is big misunderstanding and the majority does not make difference between analysis, trading, time frames. This was the reason to add this trading cycle extremely simple above MA10 buy/ below it sell..... not that it helps:)

      For example I am trading the daily chart, hourly is trying to guess how the move is developing and it is changing often, weekly is the big picture how the market looks like and it is changing seldom.
      I have the feeling the majority accept forecasting as something.... static. No one can see the future. For example on the hourly I am explaining the pattern is not completed more up, but moves higher than expected which does not change the idea, but most will see it as a failure.
      The same on the weekly chart at the lows I said up 3000 corrective move and now it is 3200 most will say failure.... when in fact nothing changed.
      Plain and simple it is not static every day there is new information and you have to adjust if necessary.
      Than comes trading you have to know when to act and when not analysis has to be confirmed, to have some trigger. I am showing extremely simple and effective system to stay on the right side... When I am saying we will see lower low does it mean go and short not of course. This is the big picture and you act when you have trigger. I am allowing my self more freedom, but this is my choice.

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    2. You have people like buffet, zell, etc who have sat out this rally..

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    3. Good explanation Krasi.

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  68. Other option is the C of the B is in ED, so it is 1x

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  69. Krasi always wait to read your posts on Saturday. Kind of road map. Thanks. It is free site dont let trolls discourage u

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  70. Krasi,
    I am waiting for your post too.
    You are about the only guy with timing cycles and EW and got the bottom right.
    You said we are are going to TOP at 3000 and now it is 3200
    Direction is CORRECT
    Now just wait for divergence on kutiple time frames for it to play out.
    I really don't know what the fuss is all about.
    Again you are awesome!!!

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