Weekly preview

Short term view - a high next week and turning lower.
Intermediate term view - there is high probability this high to be the top for wave 3 from Feb.2016 low.

The indexes are higher this week, which is not a surprise - finished pattern was missing. Now we have enough waves and all indexes are showing possible finished pattern(right on schedule the end of January).
It is not only the stock indexes which all are in sync now, If you remember in the last "Long term update" I said all asset classes are pointing to intermediate term trend change - I think the time has come. The USD took the short cut and just plunged lower for wave 5, the decline is either finished or we have small waves iv and v of 5. Bonds - TLT looks like finished triangle and reversal. Crude Oil has finished pattern and should reverse. Short volatility is not working despite the blow off.
Short said I think we have several extremely overcrowded trades(short USD,short volatility,long Oil,long stocks) which are about to reverse. For stocks the monthly bar looks like exhaustion candle similar to March 2000 this is not the beginning of a trend it is the end.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - I have shown short term charts in the last update - the same chart updated. Higher before FOMC then lower. Way too many shallow pullbacks in 2017 so you can't be sure where to start and end a wave. We have to wait and see the wave lower before we are sure that we have a top.

Intermediate term - expecting the top of wave 3 from the Feb.2016 low then 23,6% Fibo retracement.

Long term - switched to logaritmic scale. One more correction and a rally before turning bearish.

MARKET BREADTH INDICATORS
Market Breadth Indicators - the same like last week... strange blow off move Friday in the moon again and market breadth do not react at all. Starting to turn lower diverging with the stocks rally, but no strong sell signal. VIX and A/D spelling big trouble ahead.
McClellan Oscillator - below zero with multiple divergences.
McClellan Summation Index - something like double top, just crossed the signal line expecting continuation next week.
Weekly Stochastic of the Summation Index - turned lower and sell signal.
Bullish Percentage - something like double top, but no sell signal so far.
Percent of Stocks above MA50 - something like double top, but still above 75.
Fear Indicator VIX - hovering around 11-12 for weeks instead of around 8-9... big warning sign for me.
Advance-Decline Issues - very weak with double divergence, only a few stocks are participating in this rally.


HURST CYCLES
Day 18 of the 40 day cycle. It looks too stretched to me so I split it into two 40 day cycles. Usually for a bottom you have 2 or more closes below MA10, but we have so many crazy statistics with this rally so only one close below MA10 for 40 day cycle low is the least problem:)

Week 10 of the 20 week cycle.

Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Week 12 for the countdown. One more higher high next week and it will be finished. This fits very good with the EW pattern.

Update

The chart below is for the next 2-3 weeks and for the next 2 days one final high today or tomorrow will look good to finish an impulse from the last low. As I wrote this 4 yellow is questionable at the moment we have to see the decline first to be sure. Watch for RSI and price breaking below the trend lines for short term reversal.

Currently I see the pattern as shown on the chart. It depends on where you start to count green or red. There is enough small waves to count finished pattern. I think it is more likely to see in the next 2 weeks one correction and one move higher than plunge and crash.... just I do not know higher high or lower low. If you want to be a prudent trader it does not matter you have to wait for confirmation anyway.