Weekly preview

Short term view - tricky I would say one more low will look better, maybe some indexes with lower low some with higher low next week.
Intermediate term view - intermediate term low expected and higher in April/May.

Up and down as expected, but very volatile moves and tricky picture if we have a bottom or not. Different indexes show different pattern despite all of them moving in the same direction.
Short term - Nasdaq made a lower low for expected wave 5, SP500 did not - truncated fifth? We can only guess. Some indexes including SP500 will look better with one more lower low some with a bottom already.
Intermediate term - looks different for different indexes. For some the pattern looks like wave IV for some like 2 of V and for some the top is behind us.

We can discuss for days about counts/patterns/labels or do what a trader should do - the analysis says the next bigger move is up so look for long entry. Simple after that we will put the labels.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - so far nothing to confirm reversal and I will stay with the plan - one more lower low.
Finished pattern fifth truncation(green) in sync with NDX ... it is rare event and betting on this outcome is betting on event with lower probability and as a trader you should do the opposite. For confirmation the indexes should continue higher to finish impulse and then correct with three waves.

Intermediate term - either the top is behind us and we have multimonth corrective pattern like the top 2000(red) or alternate wave IV(green). The price is testing MA200 may be fake break lower and reversal, RSI and the histogram building divergences.

Long term - the index is testing the low and MA50, a rally should follow.... the last one for the move from Feb.2016. The histogram with very deep trough like the biggest corrections since 2009 - in 2011 and 2015 so this should be intermediate term low. On the other side notice it is just the left side of the trough(the green arrows) and it needs time for momentum to slow down and reverse. In 2011/2015 we saw one more test of the low. This time should not be different and I think the price will not just reverse and blast off higher.

MARKET BREADTH INDICATORS
Market Breadth Indicators - are pointing lower of course, but building divergences and start looking bullish.
McClellan Oscillator - higher low and close to zero.
McClellan Summation Index - sell signal with higher low so far .
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - double bottom?
Percent of Stocks above MA50 - second oversold bottom slightly higher and turned up.
Fear Indicator VIX - heading lower after lower high.
Advance-Decline Issues - higher low close to oversold level.


HURST CYCLES
Day 32+1 waiting next week for a lower low or not to see where to pin the low for the 40 day cycle.

Week 18+1 the same story like above. I think this is intermediate term low and 40 week cycle low.

Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Finished buy setup as expected and price flip. The price bottoming, up and down moves and the histogram doing exactly what it should do:) momentum is slowing down and trying to reverse. On the weekly chart we should see the same what I have explained on the daily chart.

Weekly preview

Short term view - up and down, do not expect bottom next week more likely the first week of April.
Intermediate term view - heading for intermediate term low and higher in April/May.

We have the move lower, bigger than as expected, but this does not change the big picture only the alternate scenario. Even better at intermediate term low you want to see fear.
This is the missing test of the panic low from February... text book price action. I still think we have complex corrective pattern like 2000 which will take months(see the last chart). Now with the deep retracement the alternate scenario changed it is wave IV and after that V follows. The most bearish scenario the plunge continues and this is w1 of 3 looks very unlikely with this indicators and market breadth.

Many were impatient asking if the move is over after every 10 points higher or what pattern we have. You are doing it backwards focusing on the short term charts to give you the direction for the big picture. It is the opposite the longer term charts set the direction and the short term charts are only to precise your entry. Always put the price action in the context of the big picture. The daily chart was clear - lower. The squiggles on the hourly chart do not mean anything until the daily charts says it is time for reversal.(see TomDemark chart for some thoughts)


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - I expect waves 4 and 5 to finish c of B.
Their is discussions about the pattern and with SPX it is easy you count the higher high in March like a-b-c B and now wave C of IV lower this is the consensus. But what do you do with DJ and NYSE which made lower high? If you count a-b-c red it is not C impulse, you have to count 1-2-3 for C and the move must continue much longer and much lower. I do not think this will gone happen. Based on this observations, the European indexes which are done with higher highs and the futures(the last chart) I still think we have corrective pattern which will last for months and not wave IV and V.

Intermediate term - the price is testing MA200 and the trend line again. It looks like the histogram and MACD are building a divergence. For a bottom wait for the histogram to finish it's trough, at the moment it is still heading lower. Alternate I am wrong and this is IV(green) with V to follow. From trading perspective not much different so I do not really care:)

Long term - the index is testing the low and MA50 and a rally should follow.... the last one for the move from Feb.2016. RSI is breaking the trend line which is a sign that this is not 4 and probably the trend from Feb.2016 is over.

MARKET BREADTH INDICATORS
Market Breadth Indicators - turned lower, some are oversold, some need a little bit lower. Watching the VIX There is no much fear. I think the message is the indexes are heading for a low with divergences.
McClellan Oscillator - slightly oversold below 60.
McClellan Summation Index - turned lower sell signal.
Weekly Stochastic of the Summation Index - buy signal.
Bullish Percentage - sell signal, in the middle of the range.
Percent of Stocks above MA50 - oversold with higher low so far.
Fear Indicator VIX - turned up, expect lower high... the option players are not very scared.
Advance-Decline Issues - heading lower after lower high...it will be great to see oversold levels with higher low and divergence.


HURST CYCLES
Day 29, the 40 day cycle is heading for a cycle low probably the first week of April.

Now it counts much better as the low of the 40 week cycle so I have changed it.

Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Day 7 of a buy setup. With the plunge last two days the setup will be finished.

Not everything is waves another tools like cycles or indicators can help you discard wrong counts/patterns. In this case the histogram is helpful. After a big tower or trough expect a second one making lower high/higher low which corresponds to a test of the top/bottom. The move up continued longer making two towers, but it was not very strong so it was time for this second trough and not for a rally. That is why my answer was always it is not over despite that we had not strong impulsive action at the beginning. Turning up with the histogram a few bars slightly below zero is typical for trending market and this is not the case.(see the December low)
Now if my "histogram theory" is right we need at least 4-5 trading day the market to calm down, the histogram to make a valley and turn up before this sell off is over.

DJ futures, SPX is not different - I see only a bunch of a-b-c moves and I do not see wave C for a huge zig-zag wave IV.

Weekly preview

Short term view - not sure I do not see reversal lower, the indexes do not look bullish either... I think up then down.
Intermediate term view - it takes too long I do not expect wave c of 4 lower. At the moment I think the top is in and we are seeing multi month wave 2/B to test the top (see the charts from 2000/2015).

The major indexes SPX/DJI/NYSE did not show signs of strength this week so ED looks now unlikely for the major indexes. Short term it is a mess SPX squeezed higher high but with a-b-c move, DJI looks like triangle only XBI,RUT continue to follow the plan w2 of ED, but one more low is needed for confirmation.
Intermediate term I expect move lower with higher low then up.I think the top is behind us and wave 2/B is running alternate the coming low will be 2 of V.

The next bigger move will be lower all indexes are showing corrective structure and the NDX strength can not cover it up. The obvious pattern is wave C lower to finish zig-zag for wave 4. I have some problems with that:
- everybody watching the same pattern lower lows - the market does not do what everybody is expecting.
- it takes way too long and we have right translated 40 day cycle, which is bullish expect higher low and the next 40 day cycle with higher high.
- you have to squeeze NDX in expanded flat - fear does not work this way. Bull markets lead to too much greed and sharp corrections follow either wave A or C is the panic wave you do not panic twice. With expanded flat the coming wave C should be even bigger and scarier. Panic sell off twice in the same pattern within a few weeks is very unlikely. So on this scale 10%+ correction the pattern does not make sense.
- on the other hand NDX made a higher high with three waves which means this is not the top.

What I want to say - expect a higher low and another move up to test the high. With higher low the options are wave 2 of V or the top is in and this is wave 2 or B of a bigger pattern lower. The strong index NDX - it does not look so strong when you look at the weekly and daily indicators and I think NDX will not pull up the other indexes higher.
So the scenario which I follow is ED for NDX and for SPX,DJI,NYSE wave 2/B(see the charts from 2000/2015) and keep an eye on possible 2 of V if I am wrong. The problem with the bullish scenario is w1 is too big wave 3 should rally 20% for 2-3 months. Another parabola in a few months with a panic in between is less likely.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - I can not say if the first wave higher is finished or not, but the next bigger move should be lower. One option is wave B flat is already running, the other option is one more high for a diagonal. After that I expect 61,8% Fibo retracement to the support zone.

Intermediate term - preferred scenario 2/B(red). I see similar pattern like 2000/2015 multi month corrective move up to test the high.
Alternate wave 2 of V(green).

Long term - I think it is more likely that the move from Feb.2016 is over and the last rally will make lower high.

MARKET BREADTH INDICATORS
Market Breadth Indicators - look positive pointing up. Not very strong, but not bearish either.
McClellan Oscillator - above zero.
McClellan Summation Index - buy signal.
Weekly Stochastic of the Summation Index - buy signal.
Bullish Percentage - in the middle of the range.
Percent of Stocks above MA50 - in the middle of the range.
Fear Indicator VIX - bounced up from the 13 level. The normal lows are 13-14 not 9-10 so not a surprise.
Advance-Decline Issues - lower high with a divergence.


HURST CYCLES
Day 24 of the 40 day cycle. For me this move up takes way too long. I expect right translated cycle and another higher high for the next daily cycle.

Week 5.... as I said it takes too long and I think a new 20 week cycle is running.

How this 2/B wave looked like in 2000 and 2015. So far the pattern looks similar. In 2000 NDX made higher and SPX/DJI lower high. Some are saying when NDX makes higher high SPX should follow. I would say - why not non confirmation? The major indexes sending a warning that the trends ends?

Weekly preview

Short term view - first we have to see what happens on Monday.... I think higher.
Intermediate term view - I suspect the correction is over.

We have the move up as expected... the confusion is the indexes show huge difference in strength - SPX/DJ/NYSE weaker with SPX testing the last high, RUT/XBI strong higher high this week, technology sector NDX/SOX very strong with new high.
Either they have completely different patterns which is unlikely or the same pattern looking differently. That is why I think the correction is over and there is no complex corrective pattern rather an impulse and the indexes are just showing different strength.

What are the options - bullish and bearish "extremes" if we have 1-2 and i currently running we will have monster impulse higher 2-3 times bigger than the January parabola or bearish wave B for a huge flat and lower low with an impulse which should cause a lot of fear again. I think we have fear and greed extreme emotions behind us and this scenarios are less likely.
The other options are the price turns lower on Monday and we have 2 of V or it continues higher to finish impulse from the March low, but instead of monster impulse we have a-b-c from the February low for 1 of ED explaining the zig-zag look for indexes like RUT and XBI.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - indexes like DJ NYSE EEM look weak and show only zig-zag, SPX looks better challenging the high. If the price turns lower on Monday expect wave c of 2. If the price continue higher and finish an impulse I suspect wave 1 of ED.

Intermediate term - the "extremes" shown green if you use standard measurement we are talking about 700-800 points for 2-3 months and January not even worth mentioning:), red we are talking about flat and wave C should cause most fear and had it already with the first leg lower, the trend line will be broken and so on.
That is why am thinking about something more realistic if we see wave 2 it looks like normal impulse or if we have ED again something like 3000 and weakness for the final wave fits very good too.

Long term - one more rally before the bull market is over.

MARKET BREADTH INDICATORS
Market Breadth Indicators - look positive.
McClellan Oscillator - above zero.
McClellan Summation Index - buy signal.
Weekly Stochastic of the Summation Index - buy signal.
Bullish Percentage - in the middle of the range.
Percent of Stocks above MA50 - in the middle of the range.
Fear Indicator VIX - resseting to the usual normal low range 14.
Advance-Decline Issues - in the middle of the range.


HURST CYCLES
Day 19 of the 40 day cycle.

Week 4 of the 20 week cycle, I assume the correction is over.

Update

This is how the futures look like(CFD SP500 4h chart).... from the lows in February I do not know how to twist the pattern as bullish... diagonal?
We have the move up this week but this move from the March low does not look bullish either. It looks like corrective a-b-c and MACD retracing to the trend line. I think the indexes will turn lower and the two options are wave C of IV to finish the correction or higher low around 2600 for another a-b-c - wave 2 of V?

The indexes show a lot of differences. If you try to synchronize the pattern for all indexes the choices I see are - wave C/IV zig-zag for all indexes(NDX flat which is zig-zag too) or the correction is over and this is wave 2 of V and NDX is the strongest index and the others are just weaker. Yes, for some indexes impulse higher is questionable, but it will not be the first time to see such "ugly" impulse.

Weekly preview

Short term view - a move higher next week, it is important how it will look like.
Intermediate term view - the correction is not over. I think wave B is running, probably triangle or flat.

Lower as expected, but first we saw one more high and the move could be counted as an impulse. This activated two possible scenarios - the correction is over this is wave 1 and 2 is currently running(I do not believe it) or wave B is finished as expanded flat and wave C lower is running. I still think we should see a pattern which lasts longer and most traders do not expect. I think the indexes finished wave b of B, but I can not show anything to confirm it. I can only wait for the market to confirm or negate this pattern.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - the mainstream view is B(red labels) is over and test of the low here we come.... confirmed with impulse lower.
I have the suspicion we saw the low for wave b of B(white labels). Look at RSI - I think this final high is part of another wave and we have two different a-b-c. MACD trend line is not decisively broken so it is possible that we have only correction for the move which begun on 09.02. or b of B. The index which have the pattern I was expecting is XBI - a-b-c higher, a-b-c correction and sharp reversal higher... and the other indexes made a fake high?

Enough theory - if we see only corrective move up to test MA50/MA200 and the indexes turn lower it is time for shorts(the red scenario) if we see an impulse higher this will confirm my theory. That is why next week is important it should clarify the pattern... at least for the next few weeks.

Intermediate term - waiting to see what happens next week. It should confirm or negate the pattern which I expect.

Long term - correction wave 4 is running, the histogram continue heading lower no signs of a slow down. One more rally before the bull market is over.

MARKET BREADTH INDICATORS
Market Breadth Indicators - turned lower which is normal after a few days selling. I do not have the impression that we will see a plunge, in fact the McClellan indicators look good.
McClellan Oscillator - around zero.
McClellan Summation Index - neutral.
Weekly Stochastic of the Summation Index - trying to turn up.
Bullish Percentage - turned lower in the middle of the range.
Percent of Stocks above MA50 - turned lower, close to oversold level.
Fear Indicator VIX - hit 15 and jumped higher. This are the new(old) normal levels.
Advance-Decline Issues - in the middle of the range.


HURST CYCLES
Day 14 of the 40 day cycle.

Week 12+3 we will know which cycle count is running and where the 20 week low is, when we see the pattern for the correction.