Trading trigger - buy signal, day 42 at intermediate term high.
Analysis - long term sell the rips. Intermediate term - reversal into 4y cycle low expected.
P.S. - for a trade both analysis and trigger should point in the same direction.
TECHNICAL PICTURE and ELLIOTT WAVES
Short term - the c-wave(yellow) moved higher from 0,62 to 1 extension. I have not seen impulses for a long time instead double zig-zags everywhere so I guess it is double zig-zag (a-b-c white). If you believe it is an impulse than it is fifth wave extension finished or one more squigle with 5=1to3.
Intermediate term - double zig-zag w-x-y/B(white) from October completing. If you allign the pattern with important cycle lows/highs the more likely pattern is zig-zag w-x-y(yellow) with triangle X and inside triangle e-wave. I have shown it as one of the possible patterns just the e-wave is sideways move not decline. Cycles fit better with top now so no alternate B-wave high after the summer.
Long term - most likely huge double zig-zag from the 2009 low. If we are lucky this is lower degree b-wave(green) and there is one more high. If not multi year decline has started.
MARKET BREADTH INDICATORS
Market Breadth Indicators - with vertical move higher I would expect to see very overbought levels to confirm strength instead the indicators are below the overbought levels with divergence. It is not a surprise very narrow market only a few tech stocks pulling the indices higher.
McClellan Oscillator - above zero, short term divergence.
McClellan Summation Index - buy signal, double divergence.
Weekly Stochastic of the Summation Index - buy signal.
Bullish Percentage - rising, but nothing convincing... below overbought level no strength.
Percent of Stocks above MA50 - rising, but nothing convincing... below overbought level with divergence.
Fear Indicator VIX - up and down looks like bottoming.
Advance-Decline Issues - turned lower below the overbought level, double divergence.
HURST CYCLES
Short term cycles - at 20d high which is at least 10w high and I think it is 40w high. Next is decline into 5w and 10w low.
Week 3 for the current 20w cycle. I think we saw 40w low around the end of May and now at 40w high. I wrote many times it divides better as three longer 10w cycles. It does not make much sense to count week 35 expecting 40w low when the price is moving in the opposite direction.
Per Neely's latest Push-Piece: "The S&P's rally since early May "proves" the 2022-2023 Bear market is OVER and that A NEW 1+ YEAR BULL MARKET started June 1, 2023!" Oh Glenn ....
ReplyDeleteBefore the bear market started, I was using his service. There was at one point during the summer off 2021 where we got under some magic number which "proved" the bear market had started. Spx went up for a half a year more.
DeleteMe too, Roberto. I got way too tired of his Neowave Diametric Bow-Ties / Diamonds, Neutral/Extracting/Contracting Triangles, and the like - which provide "cover" for when his divine prognostications get blown out of the water, don't come to pass, etc. Just change the name, draw some more/different channels or geometric shapes, and move on. Just keep the "fish" on the line. No thanks.
DeleteHe's right so far....
ReplyDeleteIf the PMI continue to go down, Neely is wrong and krasi is right
ReplyDeleteIf so, we have to see a recession
ReplyDelete40 weeks low in May or July
ReplyDeleteIn any of the 2 cases, the 4 years low will be between January and March 2024?
Yes, usually 7-8 months for the 40w cycle and the 4y cycle is usually 3.5 to 4 years long so between October and March we should see the low.
DeleteWhen we speak about the 40w cycle I would say there is no clear one.
DeleteMost likely we will see three longer 20w cycles 5-5.5 months instead of two 40w cycles.
In this case the next important low is from mid-August to early September and 4y cycle low in late January to mid-February.
So the market goes vertical and all this is based on a few tech stocks confirmed by market breadth indicators which even did not touch overbought levels.
ReplyDeleteAnd this is a new bull market... based on a few stocks... please get serious.
When a new bull market starts it is broad-based it needs strong foundation and not a bunch of giant tech stocks. You will see indicators like Percent of Stocks above MA50/Bullish Percentage hit very overbought levels like 90 meaning all stocks participate in the rally.
Do not get blinded by greed and fooled by Wall street crooks start thinking.
this decline is looking corrective. still looking for a low into late june early july (after a bounce starting tomorrow), but i believe we will see higher highs into mid-late july based on the nature of this decline. we'll see.
ReplyDeleteJP
one more thing, the high this month is in.
DeleteJP
Has the fall already begun, Krasi?
ReplyDeleteEven though the fall has begun, there still will be a few higher highs to complete the pattern/cycle.
DeleteMaybe part of topping nothing more... and this for tech stocks/indices not likely for the rest of the market.
DeleteToday the S&P's five largest stocks make up the highest % (24.5) of the S&P's total market cap since 1999. Sounds like just the START of a bull market, to me.
ReplyDeleteSeven tech stocks are the bull market - 55% of NDX and 28% of SPX
DeleteAnd the poor little R2K looks like poop - I wonder why?
Delete