Weekly preview

Short term view - I expect pullback next week then we will see.
Intermediate term view - I do not believe in a strong rally, just waiting for the top and decline into the 18 month cycle bottom.

I was wrong this week... the signals were ok only short squeeze was missing on my watch list. I though the correction begun after a plunge with an impulse - obviously not. The expected "bounce" mutated in V-shape parabolic move with ever decreasing volume - this is the missing short squeeze.

The short term pattern has changed, but everything stays the same. For me this is still the top of iii of 3 or 3, the only question is how the pattern will look like. With so many up and down there is a lot of room for interpretation. Currently it looks like a diagonal to me, and I have added bearish/bullish option to watch. Intermediate term it is the same - week market breadth, divergences on the daily chart, next bigger move is lower into 18 month cycle low, TomDemark finished sequential on the weekly chart, Nasdaq with 5 waves from the March low and divergences.... difficult to spot something bullish.

VIX is again below 10. I think it moves similar to 1993/94 - below 10 -> short living pullback(the plunge)/VIX spike higher -> the indexes higher for a few weeks/VIX below 10 again -> bigger correction.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - with such moves in the last 3 months you can not be sure which count is right, EW has it's limitations. Currently it looks like diagonal to me.
- bullish option - starting from the April low we have 1-2(green) and now in wave 3. A pause 2-3 days and another vertical move should follow.... I do not see anything to support such price action. All my tools are saying the opposite.
- bearish option - the expanded flat is much bigger than expected, the plunge was b/B and this rally is finishing a-b-c for B(red). It is possible, but we need confirmation for a reversal.
On the chart is shown another option - diagonal. I do not think the price will reverse and plunge, I do not believe that the rally will continue, so I am just waiting for a setup with low risk.

Intermediate term - for a bullish picture the price should continue vertically higher to erase the MACD/RSI divergences. I do not believe it. My preferred scenario is top of iii of 3(green).

Long term - if the move higher continue longer than expected and the RSI moves again in overbought territory, we will see divergences on the weekly charts, which means important top, which means this is wave 3 not iii of 3.

MARKET BREADTH INDICATORS
Market Breadth Indicators - if the market is so bullish and after such vertical move I would expect much more from market breadth. The indicators do not even think of moving into overbought territory... not even turning bullish.
McClellan Oscillator - barely above zero with long term divergence lower tops since late 2016.
McClellan Summation Index - buy signal, but with double divergence since March.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - sell signal, below 70.
Percent of Stocks above MA50 - in the middle of the range.
Fear Indicator VIX - again below 10... not very bullish.
Advance-Decline Issues - in the middle of the range, strange it could not move to overbought territory since last year.


HURST CYCLES
Day 7 of the 40 day cycle.

Week 8 of the last 20 week cycle, waiting for the top of the 18 month cycle.

Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Bar 12 for combo/countdown without using minimum requirements(only higher high). Another higher high or higher close next week and we will have 13.

Weekly preview

Short term view - we should see another move lower.
Intermediate term view - the correction to continue for 2-4 weeks.

SP500 squeezed a few more points higher, but then turned lower as expected. The move lower looks like impulse to me, which means to expect more to the downside. Despite the strong retracement I think it is corrective and the direction is lower.

Wave C lower for expanded flat looks best to me at the moment, so the plan stays the same.
Alternate options if I am wrong - more bullish only one more leg lower for a-b-c - than it will look like wave C of a giant triangle for around 4 months since first of March until end of June/early July. Second option more bearish the correction is much bigger and this is just the begging of wave A lower. We will just watch how the price action develops.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - after an impulse another one in the same direction follows. If we saw wave 1 and 2 this week the Fibo measurement for an impulse point to a low around 2280 which is a support level(better visible on the daily chart).
The alternate options - with green triangle and red wave A of 4.

Intermediate term - MACD/RSI with divergence... expecting wave iv(green) to support, alternate it could be wave 4(red). Now waiting and watching how the move develops.

Long term - looking the oscillators(RSI,Stochastic with divergence) I think we should see a few weeks lower so that they can reset to at least the 50 level.

MARKET BREADTH INDICATORS
Market Breadth Indicators - are pointing lower and are not even close to oversold.... there is a lot of room to move lower.
McClellan Oscillator - below zero.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - sell signal, now below 70.
Percent of Stocks above MA50 - in the middle of the range.
Fear Indicator VIX - spiked higher, curious to see if it will make a higher high.


HURST CYCLES
It is possible that we have one finished 40 day cycle. I have changed the weekly count and one shorter 40 day cycle plus one more to finish 20w/40w/18month cycle is expected.

Week 7 of the last 20 week cycle. I have changed the count, this move higher lasted too long and I think we have length 20 for the previous 20 week cycle and the current one caused the rally from April. It fits better with the price action, visually looks better... at the end it is only cosmetic change - instead of something like 11+20 we will have 20+11 for the 40 week cycle.

Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
This few points higher fit perfect - the minimum requirement for the last bars 11/12/13 is to make higher high. So if we take the minimum requirement we have finished countdown/combo on the weekly chart.