Trading trigger - sell signal.
Analysis - the indices turned lower to complete the 4y cycle low. Intermediate term low expected in a week or two.
P.S. - for a trade both analysis and trigger should point in the same direction.
TECHNICAL PICTURE and ELLIOTT WAVES
Short term - the first options B-wave of a flat, the second in a c-wave(red).
Intermediate term - RSP - equaly weighted SP500. Two zig-zags with triangle in the middle. The low of the x-wave is at week 34 which is perfect timing for the 40w cycle low(average length 32-36 weeks). Pattern and cycle fit perfect. Now a-b-c lower and 20w low expected.
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 - sell signals, no signs of a fear or a bottom.
McClellan Oscillator - below zero.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - pointing lower, in the middle of the range.
Percent of Stocks above MA50 - oversold level.
Advance-Decline Issues - pointing lower.
Fear Indicator VIX - looks like double bottom.
HURST CYCLES
Short term cycles - there is no clear 10w low, it looks like 20w cycle consisting of three longer 5w cycles. We should see pop higher for 20d high and final 20d cycle to complete 20w cycle.
Week 17 for the 20w cycle. Explained above so following this model. Not a big difference with the previous one, the low is still expected in January/early February. It is more about where you put the 40w/20w lows.
thank you krasi. a much more bearish alternative which may be confirmed this coming week is that sept 7 was the 5 and 10 week low which will bring the next 5 week low in early october and the 10 and 20 week low early november. if this were to happen the result will be EXTREMELY bearish. we'll see what this week brings. thank you for all your work.
ReplyDeleteJP
today/tomorrow could be the 5 week low
DeleteJP
this thing is starting to look really bad. not sure we get any sizeable bounce before we test the 200ma which can happen pretty fast. we'll see..
DeleteJP
There is nothing bad, this is weak corrective move lasting two months. I will not be surprised to see higher high after that.
Deletei don't think it is that weak of a decline krasi. ndx already broke and closed below the last december/march trendline. something to give some warnings in my opinion but we'll see.
DeleteJP
Krasi, is that in accordance with the first option in your short term forecast or another count? Thx
Deletewe "should" have a bounce starting today/tomorrow. if we do, any break of this low within days will turn into an outright crash. we'll see.
ReplyDeleteJP
After looking at all the equity indices, and for daily through monthly charts, I would have to agree with you JP on the outlook for them to rebound, or to any meaningful extent. Definitely nothing set up for bullish divergences, etc. for "green shoots" ahead. TBD
Deletethanks jw. very important to see the nature of this bounce which just started a few minutes after i wrote my last comment. if this bounce lasts only a few days and we turn down then the second leg of the mega bear will have been confirmed. next week is extremely important.
DeleteJP
we are at the bottom and next is 4800 . Their will be a bond rally for longer terms like 10- 20 year because TLT has lost 50% since 2 years. Some banks will be in real trouble so the Fed will come in to the rescue and I do not believe in a Government shutdown by congress with the republicans who are hand in hand with big business, the Fed etc. Smoke and mirrors and as Krazi said it was A LITTLE BLIP THAT TOOK TOO LONG. Very corrective. So higher very soon!!!
ReplyDeleteNever underestimate that there is almost always a second top for distribution in stocks and then the rug will pull out!
ReplyDeleteSell Rosh Hashana and buy Yom kippur one week later. That's the mantra and it is very powerful. Rosh Hashana is the new moon and Yom Kippur one week later is the full moon. So prepare for a rally starting September 29 to October 4 at the latest.
ReplyDeleteThe full moon theory top for stocks markets and a crash soon after the full moon which is also an eclipse of the moon 1cycle after or before an eclipse of the sun by Chris Carolan and Steve Puetz do not work during the time span of Rosh Hashana and one week after Yom Kippur and it is the inverse instead that is taking the lead.
ReplyDeleteFirst I believe the top for the B-wave is in, second a crash happens at the end of a move not at the beginning - simple psychology.
ReplyDeleteShort said I expect something in the middle - no 4800 and no crash.
From pattern and cycle perspective what makes sense and fits my expectation is this - https://invst.ly/11jfei
Complete the c/A wave and 20w cycle low with fake trend line/200MA brake, pause and then the big slide lower.
DAX seems to support such development - https://invst.ly/11jfkw
DeleteThat B wave could be pretty high, they often are in this market
Deletethank you krasi, very helpful. just to clarify my "crash" talk, i don't mean i am expecting a crash a la 1929/1987/covid 2020 lasting a violent few days. what i am expecting is a prolonged and relentless decline with some bounces along the way over the next 2-3 years which will shave off over 50% of the sp from its all time high. i believe we have started the second leg of the bear market which began in early 2022. lalaland excesses are on their way out and the fed is about to panic.
ReplyDeletefor now will focus on each week at a time and that's plenty with this sort of volatility. this bounce should not last more than a few days if not less and the 200ma target is clearly next.
JP
one more thing yesterday's 55point vertical bounce in less than 20 mns was 100% fed intervention through blackrock or one of their other cronies. the fed is about ro panic.
ReplyDeleteJP
Thank you Krasi for your opinion. You might be right, but the long-term bond market is so much extended to the downside that it is almost nonviable. So, without an outright Fed pivot which is an assured self destruction, and they will not do it for sure immediately, with all the concealed instruments they have undercover, we might see a powerful short covering bond market rally that has legs and will support a strong stock market reversal for many more months. We will see, but we are at a critical juncture, that needs some kind of intervention without which, the populace who have already started to revolt at many places, by multiplying strikes and protests etc., will do it big time and destabilize "The System" everywhere.
ReplyDeleteunfortunately this is what i am expecting: a breakdown of the financial and social system. whatever the fed will try to do to save it will only have a temporary effect with bounces before the next leg down. as for bond prices they will bounce pretty soon but in the big picture the yields we had enjoyed and abused are a thing of the past for many years to come. the fed created this monster and it is now payment time.
DeleteJP
enough drama bout fundamentals:) lets focus on the technicals and cycles of the market.
DeleteJP
What do you think of Natural Gas?
ReplyDeleteLooks like fourth wave counting from the top... I would say one final decline(short living) and reversal higher.
Deleteif by next week we don't break this week's lows WB retracement will have started lasting a couple of weeks. next week is important.
ReplyDeleteJP
but i think we will break it:)
DeleteJP
giant gap down open on monday straight to the 200ma
DeleteJP
What do.you think of Hang Seng ?
ReplyDeleteFrom the low in 2022 - leg higher, now correction lower running, probably it will be completed in Q1.2024 when the US indices make their low, then the second leg higher.
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