Lower but we do not have an impulse yet to confirm reversal. I think reversal fits better, but until we see confirmation we have to assume that one more high is possible.... maybe something like the July high - one more touch of the trend line(see the daily chart).
The big picture is the same - I expect important high wave c/B to be completed and the final wave lower in to mid-2020 to finish the correction.
Disclaimer: all this below are just fancy looking colorful pictures for fun:) Do not trade based on them. Do not blame me for your trades.
TECHNICAL PICTURE and ELLIOTT WAVES
Short term - if you think this is an "impulse" w4 is now running with one more high for w5. The price action the last three days is very choppy and overlapping and I do not see how this is a turn up again, more likely another move lower. As long as the price stays in the channel it is possible that this is c/4, but if the channel is broken we have reversal.
My feeling tells me this is not the right pattern. This count does not fit well with DJ and NDX and the message from RSI(see DJ below). This second part of the rally looks bigger and stronger creating the illusion for a third wave, when in fact it just takes longer and has the same size.
For DJ counting an impulse does not work so good - this is classical a-b-c pattern with "a" as a zig-zag, "c" as an impulse and a=c... or some are counting fifth extended wave(yellow). For this counts one more high does not look so good because you need small wave iv of c or 5 an it takes already too long. RSI says the movfe from the October low is finished we have broken trend line which is tested now.
Intermediate term - RSI hit overbought level and broke the trend line so either we have a top or one more touch of the trend line with divergences like in July. There is no more third waves or extensions what ever. We have three consecutive higher highs and MACD with lower highs multiple divergence, I do not see how this is not a top.
I explained above that this is probably corrective leg so in this case you can count expanding ED for c/B... better visible on the
futures. This pattern is extremely seldom, I call it unicorn:) I have never seen one maybe this is the first time.
Long term - we are nearing the top of wave B and sell off into Q2.2020 should complete the correction which begun in January 2018. Alternate scenario a decline in three waves, but still a decline.
MARKET BREADTH INDICATORS
Market Breadth Indicators - weak and turned lower again.
McClellan Oscillator - below zero.
McClellan Summation Index - sell signal with divergences.
Weekly Stochastic of the Summation Index - sell signal with divergences.
Bullish Percentage - turned lower with divergences.
Percent of Stocks above MA50 - turned lower with divergences.
Fear Indicator VIX - building a base, spike higher expected.
Advance-Decline Issues - heading lower no signs of strength.
HURST CYCLES
Day 63, RSI and price broke the trend line and RSI broke below MA18 signaling daily cycle turning lower.
Week 13 for the 20 week cycle.
