Weekly preview

Lower as expected, but the market gave us some new information. When you expect final move higher/lower to complete 20w high/low cycle and you see three weeks in the opposite direction.... it is over. From pattern perspective if there is more to the upside the possible patterns are triple zig-zag very rare or ED rare with questionable shape(very short wave 2).
Short said the probability for higher high is very very low.

The current move lower is big and long enough to be comparable with the previous two legs - down and up so it is of the same degree. I am excluding the option for continuation(explained above). On the other side it is moving slowly compared with the last move up(from the December low). This means most likely this is not a reversal but part of a bigger pattern. Short said wave b/B is running shown on the daily chart. This will fit perfect with 18m cycle low in October and 40w cycle low when wave b/B completes in 2-3 months.
There is surprise pattern triangle which fits with 18m cycle in June looking like this - the triangle ....but first lets see a wave looking like possible d-wave.

The alternate option is the move higher is over(the B-wave).... but again so far this leg lower is moving slowly. If it accelerates it will become the primary scenario.


TRADING
Trading trigger - sell signal, declining into daily cycle low.
Analysis - long term sell the rips, we have major top. Intermediate term high - lower for two months.

P.S. - for a trade both analysis and trigger should point in the same direction.

TECHNICAL PICTURE and ELLIOTT WAVES
Short term - probably in the middle of the a-wave.

Intermediate term - waiting a few weeks for more clarity. Depending on where you put the low either B is complete or b/B is running.
On the radar - d-wave for B triangle or very low probability - one more high.

Long term - most likely huge double zig-zag from the 2009 low B-wave was completed and multi year decline has started. If we are lucky it is lower degree b-wave.

MARKET BREADTH INDICATORS
Market Breadth Indicators - are moving lower.
McClellan Oscillator - bounce up from oversold level and small divergence.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - moving lower.
Percent of Stocks above MA50 - in the middle of the range.
Fear Indicator VIX - weak move higher.
Advance-Decline Issues - trying to turn up.


HURST CYCLES
Short term cycles - close to 20d cycle low, next we should see something higher for 20d/5w cycle high.

This is the cycle model with 18m low in October if the B-wave started from this low.
Since that low we do not have clear 20w cycle. To stick to the theory you have to count one very short and one long 20w cycle. Visually the 40w cycle will look like consisting of three shorter cycles and each of them 3x5w long.