It was another rather dismal day for the market. After opening higher, the market quickly gave back its gains, falling to 1311 before any attempt at a rally. After moving up to 1319, the SPX moved steadily to the downside for the rest of the day closing at the low of 1305.37.
Earlier today, we thought the wave structure was playing out in such a way that we should see a low if the market held above 1303. From there we thought the market was set for a rebound, and possibly the end of the correction.
We have been operating with the idea that we have been in wave 3 of a 5 wave sequence from 1415. Recently we posted that there was a possible 5 wave count from 1415 to 1348. We’ve spent most of today reviewing our charts, with the market not behaving as we thought it would. By using that 5 wave count from 1415 to 1348, it would out us now in wave 5 from 1422. The target ranges are similar to what we have been projecting, and this was accomplished without changing any of our 5 wave counts, but only how they are put together.
From 1422 we have 1357.38-1415.32-1347.75-1365.88, with a target for wave 5 under 1314, which we have met. Wave 5 of the sequence then began at 1365.88. A 5 wave sequence from there was completed at 1325.95. That then became wave 1 of a larger degree sequence which should terminate between 1307, and 1302, right where the market is now. Since we have wave 5 of wave 5 from 1422 terminating at current levels, one would expect the completion of the 5 wave sequence to be imminent.
There are some disturbing features to this wave however, which is why we are not calling this the end. The downside limit of wave 5 from 1422, under the current count, leaves a lot of room to the downside. Additionally, the way the 5 wave sequences are playing out from the beginning of wave 5, 1365.88, could result in a succession of 5 wave sequences to the downside. In this type of set-up it is difficult to call a bottom. With all waves from 1422 within their target termination zones, we could also be at a bottom. 1302 is the lower limit of our target zone from 1366. If we can hold that at the open, we could see a pretty good rally. A break of that would mean another sequence to the downside would need to be completed.
Once again there is great downfall in the market. Friday market is negative. Many of the stocks have lost their values, so people are dare to invest in stock market. So think wisely before investing in share market. Consult with financial expert before investing in share market.
ReplyDeleteCommodities Trading
OK, we just set a record on 5/18, the DOW has never gone 12 of 13 days down ever. I'm no genius but consider this:
ReplyDelete5/16 - 900,000 puts traded on the SPX
5/17 - 1,000,000 puts traded on the SPX, both 2.5 times normal.
How setup are we for the mother of all short covering rallies any day next week on your wave model?....