Weekly preview

Well the market creating a lot of confusion with the decline this week... I still think we have a topping and the decline has not begun. Just maximum confusion before the top.

A lot of confusion because at first look there is many possible patterns from reversal to intermediate low and the rally resumes. My opinion is we have not seen the top and we need one more move up even if it is a lower high.


TRADING
Trading cycle - sell signal. The last high and the current low are just half cycle high and low. They are not pattern high/low, they are legs of a bigger pattern. This "fake" M10 crosses occur in sideways pattern like triangle and flat and I susspect this is what is going on.

TECHNICAL PICTURE and ELLIOTT WAVES
Short term - it looks like impulse, but I think it is another corrective pattern. For impulse we need to see waves 4 and 5. NDX,RUT are not even close to something like impulse, so I doubt we will see this waves 4/5.

Intermediate term - the perfect pattern will be to see one marginal higher high. It will create maximum confusion, it will trap both bears(now convinced in reversal and giving up at higher high) and bulls(the market always going up) and it will fit perfect with cycles. So main scenario flat for g diametric or Z, alternate weak bounce to complete triangle Y or g with lower high.

The leg lower is longer than the previous leg up without fully retracing it. This is not how reversals look like.... despite that what else could it be:
The bullish view is this is a flat from the September high - there is no impulse so far for c, the b wave is the shortest which is not allowed, completes at 5w low, in the middle of nowhere concerning time.
The most bearish view - impulse lower since the September high.... I will not even comment this nonsense - just look at NDX and RUT great start of the third wave.
Another lower high for g diametric or Y triangle - possible, but it will be a weak move higher and not create enough euphoria to trap the bulls.

Long term - the bull market completed in 2018. Since then a bunch of corrective waves. Currently I think this rally should be a corrective wave of a bigger pattern most likely triangle. Look at NDX we have corrective wave which is 1,618 bigger than the previous one which could be only b of a triangle. I think the best looking pattern is Neely's triangle. Wave C should begin soon.

MARKET BREADTH INDICATORS
Market Breadth Indicators - turned lower some with oversold levels so something higher is comming at least short term bottom.
McClellan Oscillator - oversold levels.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - trying to turn lower.
Bullish Percentage - sell signal.
Percent of Stocks above MA50 - almost reached 25 level.
Fear Indicator VIX - should pullback lower for another higher low.
Advance-Decline Issues - some retracement higher expected.


HURST CYCLES
Short term cycles - it looks like 5w low so next we should see move higher for 5w high. Interesting is the last two 5w cycles high and low are asymmetrical and look similar - 10-18 days for a high and 16-9 days for a low.

Week 5 for the 20 week cycle. For now sticking to the plan that late September was 20w low and we have not seen the 40w high.