Last week I wrote, “The turn is in.” That certainly seems to be the case.
The Summer Solstice was on June 21. The Nasdaq topped on June 9. For my Trader’s Gold subscribers, I’d predicted a turn for ES/SPX on that day at 2446, which it hit (and I called the NQ top as it happened).
However, I also warned of one more top after that for ES/SPX. I predicted that top for SPX at 2452, but I missed by two points, as it went up to almost 2454 before turning over. That was the final high on June 19.
Since then, we’ve been slowly turning lower. Volume, which was almost non-existant relative to the norm, has now started to rebound, as predicted. More downside is certainly to come. Wave continues to drop …
So, Ralph Elliott has been proven correct again, with his discovery of one of the laws of nature, one that predicts the movement of the financials markets so accurately, I often find it eery.
Nature’s Law
Ralph Nelson Elliott published Nature’s Law in 1946, two years before his death in 1948. It was as complete an explanation as he could provide of his work discovering the Elliott Wave Principle. It was not until many years later, with the publishing of the book, The Elliott Wave Principle, that Robert Prechter brought his work into the public arena.
The two key elements of Elliott Wave Theory to me are, fibonacci ratios and wave structure. Here’s a review of the basics in those two areas.
Here’s an excerpt from Nature’s Law:
“Fibonacci was an Italian mathematician of the 13th century A.D.. He was better known in his day as Leonardo de Pisa. He visited Egypt and Greece, and on his return to Italy, disclosed what is known as a summation series. This series of numbers follows: 1.. 2.. 3.. 5.. 8.. 13.. 21.. 34.. 55.. 89.. 144.., etc.
Any two adjoining numbers equal the next higher number, for example, 5+8 = 13. Any number divided by the next higher number gives a ratio of .618, for example, 8/13 = .618. Any number divided by the next lower number gives a reciprocal of 1.618. In the lower numbers, the ratios are not exact, but close enough for practical purposes. To simplify reading, I will hereafter refer to the former as .62 and the latter as 1.62.
Note that the first five numbers of the summation series, 1, 2, 3, 5 and 8, are shown in the complete diagram of the pyramid.
“The original measurements of the great pyramid of Gizeh are estimated to have been: base 783.3 feet, elevation 484.4 feet, ratio 61.8 percent. The elevation, 484.4 feet, equals 5,813 inches (5-8-13 FSS*).
Looking at a pyramid from any one of the four sides, three lines are visible. The diagram in figure 2 is a complete cycle. Viewing the pyramid from any one of the four corners as in figure 3, five lines are visible. A pyramid has five surfaces — four above ground and the bottom. From the apex, a pyramid shows eight lines, as shown in figure 4.
From experience, I have learned that 144 is the highest number of practical value. In a complete cycle of the stock market, the number of minor waves is 144, as shown in the following table and diagrams (click to enlarge):
| Number of Waves |
Bull Market | Bear Market | Total (complete cycles) |
|---|---|---|---|
| Major | 5 | 3 | 8 |
| Intermediate | 21 | 13 | 34 |
| Minor | 89 | 55 | 144 |
All are Fibonacci numbers and the entire series is employed. The length of waves may vary, but not the number.
Note the Fibonacci Summation Series numbers in the following:
- The bodies of humans follow the numbers 3 and 5. From the torso there are five projections—head, 2 arms, and 2 legs. Each leg and arm is subdivided into three sections. Legs and arms terminate in 5 toes and fingers. The toes and fingers (except the big toe) are subdivided into 3 sections. We have 5 senses.
- The monkey is the same as a human except that his feet are the same as his hands, that is, his big toe is the same as his thumb. Most animals have 5 projections from the torso—head and 4 legs, total 5. Birds have 5 projections from the torso—head, 2 feet and 2 wings.
- Music: the best example is the piano keyboard. “Octave” means 8. Each octave is composed of 8 white keys and 5 black keys, total 13.
- Chemical elements: there are approximately 89 primary elements. [there have been more discovered since, but the primary elements from a biological perspective are 5: carbon, hydrogen, oxygen, nitrogen, and phosphorus [These are the primary elements found in cells, DNA, and RNA. The three main organic molecules are composed of Carbohydrates CHO, Fats CHO, and Proteins CHON.- Peter]
- Colors: There are 3 primary colors. Blending produces all other colors.
* FSS refers to: Fibonacci Summation Series
Miscellaneous Observations:
- The Western Hemisphere is composed of 3 subdivisions, North, Central, and South America.
- In the Western Hemisphere, there are 21 republics, all of which are members of the Pan American Union. North America is composed of 3 countries, Canada, Mexico, and the United States. South America is composed of 10 republics and 3 European colonies, total 13. Central America was, previous to the Panama Canal, composed of 5 republics.
- The United States was originally composed of 13 states. Today there’re 55 subdivisions as follows: 48 states, District of Columbia, Philippines, Panama Canal zone, Puerto Rico, Alaska, Hawaiian Islands, and the Virgin Islands.
- On the Declaration of Independence, there are 56 signatures. The original number was 55. The last was added later.
- Main branches of the federal government: 3. Highest salute of the army: 21 guns.
- Voting age: 21 years.
- The Bill of Rights contains: 13 points.
- The colors of the national flag are: 3.
______________________________
Fibonacci relationships are everywhere. From our DNA right up through the planets that revolve around our Sun. My video on the Golden Mean is here.
The Elliott Wave Principle relies heavily on them. They’re all through the stock market. Waves have new relationships with each other that I keep discovering on an ongoing basis.
______________________________
The best of them JL 2
 | The best of them …Last couple of years, I subscribed to several ‘market traders’. You are by far the best of them and the personal contact is awesome. Daily and daily updates are very well written! Besides your expertise in EW, I also like your cycles analysis. Best investment I ever made! —JL |
Couldn’t be happier … KK 2
| Couldn’t be happier …The analysis and insight you provide is simply amazing! I’ve been trading the futures and equity markets for well over thirty years and usually average around 5% monthly. Since joining your Traders Gold Service two months ago, that number has better than doubled. I couldn’t be happier.—KK |
Rise above the rest … SM 2
| Rise above the rest …I have only ever met a few people who, in their chosen fields (astrology, medicine, music, martial arts, technical analysis), rise above all the rest and you are one of them…you have ‘the gift’…and that’s why I’m a Trader’s Gold member. —SM |
the real deal SM 2
| The real deal …‘Educational, insightful and thorough market analysis for all levels of traders. It’s Elliott Wave at its best….Peter Temple is the real deal’ —SM |
Get an upper hand … JC 2
| Get an upper hand in trading …Seeing all the different currency pairs and the wave structures and hearing you explain why this has to do that on a nightly bases gives one a upper hand when trading. Elliott Wave applies to all stock and indices and can be applied to any candlestick chart. If someone ask what you want for Christmas – Tell them a membership to Peter’s “Traders Gold!”—JC |
A true expert in Elliott Wave FL 2
| A true expert in Elliott Wave …You are a true expert in EW analysis. What you provide is not available anywhere and is priceless. Subscription on your services is the best thing I have ever done. Many thanks for your effort to make me a better investor. I now have more trust in my investment decisions. I hope you will continue the excellent work! —FL |
Tops in your field DZ 2
| Tops in your field …You are tops in your field. Tried to follow Elliot Wave international for years. They were always behind the market. After discovering you, I perceive that you are an expert in reading the waves, which puts you way ahead of the rest of your peers. And you can read the Waves like you are reading tomorrow’s financial section. I pray you stay healthy. —DZ |
Have not had a losing week RW 2
| Have not had a losing week …I have been with Peter almost a year. The only thing that matters is have I made money with his service. I think I have finally turned the corner using Peter’s EW. I have not had a losing week in the last 5 months. Thanks Peter, for your amazing amount of hard work. —RW |
The Market This Week
Here's the latest daily chart of ES (emini futures)
Above is the daily chart of ES (click to enlarge, as with any of my charts). Last weekend, I wrote that we had finished topping. While there were points at which that call was questionable, it now seems most likely to be the case. We appear to be at the top of wave 3 of a (likely complex) five wave move to the downside.
Technically, in Elliott Wave, the top is not in until we drop below the previous 4th wave of one lesser degree, which is at 2400.
The lesson here is that the topping process is just that—a process. And with everything attempting to turn at the same time, it's been an extremely long and frustrating one.
The likeliest scenario for the pattern at the moment is a flat. We'd be at the top of the C wave, if that's the case.
Summary: We seem to have completed the third wave in ES at the top of a possible expanded flat (a running flat is also an option). Our task now is to break support to confirm the top.
Volume Head's Up: Look at the relative volume at the bottom of the above chart. Last weekend, I noted how low volume had fallen, but said that as we start to move down in the fourth wave, volume will start to return. This week, volume is headed up, which further signifies that top is most likely in place.
After completing the larger fourth wave, we'll have one more wave to go, which could be an ending diagonal as a fifth wave. The long awaited bear market is getting closer.
______________________________________
Sign up for: The Chart Show
Wednesday, July 12 at 1:00 pm EST (US market time)
The Chart Show is a one hour webinar in which Peter Temple provides the Elliott Wave analysis in real time for the US market, gold, silver, oil, major USD currency pairs, and more. You won't find a more accurate or comprehensive market prediction anywhere for this price.
Get caught up on the market from an Elliott Wave perspective. You’ll also get Andy Pancholi cycle turn dates for the balance of the current month. There’ll be a Q&A session during and at the end of the webinar and the possibility (depending on time) of taking requests.
All registrants will receive the video playback of the webinar, so even if you miss it, you’ll be sent the full video replay within about an hour of its conclusion. For more information and to sign up, click here.
Peter,
I enjoyed that update!
I reckon 144 jibes with Dunbar’s Number, the maximum number of human relationships we can juggle in our head at any one time. He estimates it at about 150.
Peter,
Great post! Thank you!
I would assume then if this is the turn then the USD currency pairs should see USD fall against them..
Weekly shooter on the SPX last week too..
Well maybe except for the USD/JPY. Couple of experts think it is going to 114.00
IDK I don’t follow it that closely..
Excellent post, thanks Peter!
Thank you for the Update peter
I am accepting wave 3 as over and will
use a closing level at 21527.80 as the key level to watch
going into July 14th .
A close on that level on that day id consider perfect.
if the Dow closes at Fridays levels on july 14th it will
give the most overbought reading since 1938 in one of
my long term charts .
( so to me price and time matters then )
ill consider key support at 18534. on a very long term closing basis .
short term 20320-19200 range ( 20320 to 17048 is the range )
How Ever .
I think we are in a triangle which implies the upper ranges rather
than the lower .
a July 14 close at 21527.80 is a highly calculated guess…..
if that were to actually happen id add 72 trade days to July 14
and look for a low in wave 4 .
Late October early November as a bottom of wave 4 .
I don’t like that ( id rather it be a top )
but that is what i m seeing .
a crash type move has a very large range .
cant rule that lower portion of the range out
it still doesn’t change my mind though that if we see this
we go back to new all time highs into 2018.
i m in agreement with you peter on the wave count
the timing will work itself out eventually .
thank you
Joe
I also have a top on July 13,maybe a little pullback tomorow after that up again.
PALS suggests weak zone this week and early next week. Earning season coming up so sell off may be unimpressive.
Monthly dow from june 2016 to date has 5 waves up
that stand out on the monthly chart .
there can be argued the 5th wave has not yet reached the distance of
wave 1 yet as it sits it is a 5 wave structure .
How you count from july 2014 to june 2016 is now open for discussion
( im asking the market not anyone in particular )
did we complete wave 4 in jan 2016 ? or june 2016 ?
The monthly chart dow im talking about .
Well I wrote it. Did anybody trade it?
Remarkably, the manic banksters ramped up another perfect shorting opportunity this morning, with DJI even making a new all time high. I was quite surprised by that but it only spells a huge divergence with SPX and NDX and I suspect will also prove to have been counter-trend. This possibility is what I was thinking when I asked about an ABC correction with the B leg moving past the start of A. If that is what DJI, did then the next wave down should be an impulsive C wave and be the conclusion of the fourth wave.
new highs in the transports a weak one yet a new high so 5 waves up
now in transports and dow monthly print basis .
also 5 waves up in NYA on a monthly basis from june of 2016.
we have 5 up so its now a matter of seeing how the decline
forms . ( if it forms obviously )
im long by default being long individual stocks .
wheat making new 1 year highs today
the move has been impressive
here i am thinking wow nothing is moving
lol
looks like trading is over
happy 4th
5 minute chart looks like 5 waves down on dow into the close
should be interesting how this plays out
Yeah. Those five wave impulses no longer mean what they used to. They occur commonly with the market continuing higher in spite of them. We had another at last Friday’s close.Strange times!
Verne
Can’t say I agree
5 waves are 5 waves . How the market moves afterwords
Might make something else . But an impulsive 5 means the same
As it always has as far as I’m concerned .
I jumped up and down saying June 30 a high and today
Was the first trade day following it and I saw a 5 wave
Move , it’s only a 5 minute chart but….
To be 1 trade day off calling a top is not a bad call.
Yes I have changed my mind in some ways yet
If that was a clean impulse then I’ll expect a gap up open
In the regular session back towards 21523 which was the wave
4 high . A gap down I would not like to see because it would
Change the length of what I see as wave 5 . A gap down open
Would imply it was an a b c decline and not a 5 .
I meant to point out that five wave impulses off new highs these days do not necessarily signal a change in trend. This is clearly a function of the remarkable number of Zig Zags we have been seeing. I may have been mistaken in assuming that is what your comment implied.
Andy Pancholi FREE video – “Week Ending 14th July 2017”
http://tinyurl.com/td9tjaj
thanks Rotrot
https://worldcyclesinstitute.com/elliott-wave-taking-apart-the-chart/comment-page-1/#comment-18095
verne
i don’t agree .
the reason that a 5 wave impulse as you call it has failed
was because it was not a 5 wave impulse or if it was a 5 wave
impulse it was part of an irregular top formation which begins
with an A wave down a B wave high and the wave C unfolds
in 5 waves .
at the moment i see 5 down and it fits math wise
http://imgur.com/sqmJG2G
My point exactly. A downward corrective wave that is an expanded flat can have a b wave that makes a new high followed by an impulsive C wave down to new lows and then a resumption of the upwardntrend. I mention it because I have seen that exact thing happen several times this year and the impulsive wave turned out to be a C wave. I personally never consider a wave to have “failed” as you put it; rather it is always my own interpretation of what I see that is at fault. 🙂
Yep. That sure does look like a five down to me. Today’s action did not change my current view that rips should now be shorted and that is what I merrily did today! 🙂
Off Subject .
i dont wish to bring religion into this message board yet today
ill touch on it and make it quick .
Google search : Trump chosen by god or god chose trump or something
similar.
i don’t bring this up lightly so not offending anyone with my own beliefs or
trying to sway yours.
These people truly believe that trump is the anointed one and that
there is no way anyone can stop him ( because this is gods choice )
from what i have heard, seen , watched which is very limited .
These people are creating a movement which will be the re birth of the church .
Think about it for a minute . God and money don’t mix . people need something
or someone to believe in . you pray generally when things are tough in a selfish act to repair what ever went wrong . when things are good you ignore god .
we alter our beliefs to justify our life styles .
if these “prophesies” are even remotely true then it is those of faith in god ‘
that will re elect trump and also vote out many of our politicians .
its going to take a great depression though to restore the church and do away with the greed !
Just food for thought
Joe
It took 2 atomic bombs to make the Japanese realize maybe their emperor was not as invincible as they thought. Let’s hope the US doesn’t make the same mistake.
“President Trump’s Impending Resignation and Declaration of Victory” – Harry Dent, June 1, 2017
http://www.marketoracle.co.uk/Article59234.html
I used to subscribe to Dent’s “Boom & Bust” publication and think his demographic ideas are valid. His contention in that article that the news media is “more objective” than Trump substantially lowers my estimation of his own objectivity. Considering what we have been learning about the news media of late, that contention really makes him look foolish and uninformed at best, or like a MSM shill at worst.
The elephant in the room that Dent ignores is labor inputs are less relevant every year due to technology improvements (an aging farming population in the middle ages could cause production declines). Today most jobs will be phased out starting with increased automation of factories, shipping, transport, retail, food service, medical, accounting; pretty much the entire economy. So, the more relevant question is how many widgets approaching zero in net marginal cost will be produced by whom and who will have the income to purchase this widgets (widgets defined as units of goods or service in the economy). I foresee a decade or two of robust growth in the stock market and the economy with higher interest rates and inflation and increase govt. transfer payments to the workers displaced by technology.
I am not sure if those considerations really change his basic argument on demographics. The argument is valid whether viewed from the production or consumption perspective. They can replace every worker in the economy but still make no profit with falling aggregate demand. This simple fact has blinded the multi-national corporations and people like Buffet who destroyed tens of thousands of jobs with the KRAFT-HEINZ merger to how ultimately destructive and counter-productive their limitless greed will prove to be. Who is going to buy their stuff with the entire world un-employed? Despite all the talk about how technology will be the savior of the global economy, the velocity of money continues to fall with no sign of a turn-around on the horizon.
I suppose the developed economy zero marginal cost producers of the next few decades will sell their goods to the hundreds of millions of newly formed emerging market middle classes who will also be buyers of the technology so that in a few decades they will be able to zero marginal cost producers as well. =)
That is assuming emerging market are going to survive the coming debt deflation. Many of them are saddles with ridiculous amount of debt. When the dollar rises initially at the start of the crisis (70% of global debt tis denominated in dollars) as debt destruction begins, these economies and their middle classes are also going to struggle. The deflation is going to be world wide since the debt and bond bubble is global. There will be nowhere to hide I’m afraid. Not even emerging markets.
Could they “grow” their way out of the problem. Excess revenue to pay for the debt obligation?
These economies have mainly commodities and the service indusrty(tourism) as sources of income. The ones that depend on exports for revenue will not see any growth but the opposite, and so will service based economies.The fact that even China has struggled to boost its economy by domestic consumption even during the good years is telling. They could only grow their economy by massively expanding debt, with now the highest debt to GDP ratio in the world. A rising dollar is also going to cripple many emerging market economies.
Trump was the lesser of two evils.
“we are likely still a year or more away from a final price top for the stock market” – Tom McClellan | June 30, 2017
http://tinyurl.com/uq4ywhz
It is always fascinating when two very well respected analysts are on completely opposite sides of a critical argument. Unlike McClelland, Pancholi says his cycles are pointing to a much closer event horizon for equities. Martin Armstrong agrees with Pancholi and thinks that this Fall (September) it the time period to watch.
I am starting to suspect that the current correction is going to sharp and short ahead of the last wave up. It sure does seem as if some of the more bullish folk are entirely discounting some sort of geo-political black swan event. Global tensions are as high as they have ever been and I don’t think that can be ignored.
i think harry dent has an agenda to fulfill so ill question
his words .
tom McClellan backs his thoughts up with statistics
and those statistics fit my timing model so who am i to judge ?
Andre, for the record i have never respected trump but i do think
he is the guy we need at the moment . he is far from invincible and
using amendment 25 is certainly a possibility to get him out of office .
i view the democrats booting out trump no different then the republicans
trying to change Obama care yet after several tries and years of attempts
they had no plan what so ever when they had the chance .
politics will never be the same nor go back to how it once was.
the democrats to me now need trump and the republicans don’t have the guts
to go against their base . its a draw . they will do as they always do which is nothing.
the only way we get anything will be an economic decline .
catch 22. gov pensions going broke and government money hedging bond positions by purchasing stocks . all it takes is no buyers . you don’t even need
sellers to drive this market down . add in sellers and good night .
its when buyers don’t buy then panic sets in .
Yeah. The missing volume on the multi-year run-up has been the deepest of mysteries. I think that is why we have seen the almost-frantic CB buying at every little initial decline the last several years. I still cannot get over that massive red candle the NDX posted back on Friday June 9. The volume was scary. Frankly I am at a loss to fathom why these markets continue to trade at these elevated values considering the dry-rot we all know that underlies it. The increasingly frequent talk I have been hearing these days about a market “melt-up” and another possible several years of the bull market is even more incredulous. I guess anything is possible, but looking around at retail, auto sales, imploding state budgets and contracting credit just to name a few, it sure seems to be that we are already entering what Kunstler calls the long emergency.
another great read
http://ponziworld.blogspot.ca/
The idea of God’s sovereign choice in the appointment of leaders is certainly taught in the Bible and would also apply to Obama’s time in office. It is a two-edged sword.
It says in the book of Daniel (4:17) he sometimes puts in authority the “basest of men”, and no one can argue that point. My personal view is that His keeping Hillary Clinton out of the White House was an act of mercy.
In the long run it probably will not matter. America has gone beyond the point of recovery in my opinion.
Tom,
What are these charts “telling” you? Have you drawn any conclusions that you would be willing to share? Thank you in advance!
im planning on getting short the dow futures yet
my trade is based on the cash index so im going
to wait until the cash session opens .
support sits in a few places as i see it
21263-21224 would imply this is some sort of triangle ( sideways move )
below that i see 20819 .
the pop to new highs yesterday in the dow was not expected by me
yet the up move was .its possible we trade higher into Friday then
down next week .
My issue is simple, i see 5 waves down on the cash dow 5 minute chart
the futures have been finding resistance at the .618 retrace level
21523 was the previous 4 on this short term decline and the .618 retrace
on the cash index sits at 21529 . we have a set up for a bearish move
enjoy the 4th everyone 🙂
These markets are treacherous and unpredictable, as we have seen previously. NDX on many levels seems to clearly suffered a significant technical break-down, including what was a very clear break of a held trend-line and the neck-line of a H&S pattern. The break was impulsive and we had a re-test of the broken lines. By all accounts very bearish price action, but I have learned not to take anything for granted with all the meddling going on by central banks. We had a bit of breadth/price diversion at the last low so that is slightly bullish. Nothing the market does surprises me anymore so one just has to be flexible. That new DJI high was mostly a ramp up of bank and financial stocks. GS contributed the lion’s share of the run-up.
The price action in Gold is very interesting. Peter pointed many weeks ago that the upward movement was all corrective and that price would come back down to the prior lows and he was right on the money. I may be remembering this incorrectly but I seem to recall that that revisit to the area of prior lows would be coincident with the market top and Gold still has bit of way to go toward that target. Does that mean this fourth wave could end up being shorter than we expect so the next wave up could get in line with Gold’s approaching its own low? Any thoughts?
It could be that it was the dollar that was supposed to make its low at the market high, just not sure which.
i follow gold but not close enough to add to your question verne
this mornings bounce near the open failed to do what i was looking for .
the decline unfolded as expected yet the wave count now looks more
like a 3 than a 5 . the spx daily chart looks like a triangle of sorts
the nasdaq qqq appears to be an a b c decline . apple might be in a 4th wave
of a larger decline which began may 15th.
back to watching for another set up yet cautiously bearish in my mindset .
a sideways move based on the 8 month cycle chart i look at would last another week and would then call for new highs into august .
July 14 and 21527.80 still sits in my mind based on the 36 trade day chart
to many mixed signals for me at the moment
Joe
Mixed signals indeed. I am increasingly less bearish as SPX holds onto that 2400 pivot and the bullish divergence we saw on NDX is resulting in an upside move today. This kind of ambivalence is not what I would have expected of a major degree trend change, unless of course we are in some kind of triangle which could mean mostly sideways movement for quite some time and not a very good tradeable scenario unfortunately.
Yeah, look for the triangle. SPX may not be totally “done.”
This market looks bearish
the next upside in the dow if it comes and i have doubts
would up to 21984.90 where wave 5 equals wave 1 .
i have a problem with that only because we are right now
sitting at the lower side of the upper trend channel .
at the tail end of a bull market individual stocks tend to lag
the indexes and we are seeing this take place .
the value line index has been going sideways in what looks like a running
triangle since feb 2017
andre may have some input on this .
when looking at the monthly value line index from the oct 1987 low
count forward 180 months you get the oct 2002 low , this shows up
in just about every index , count forward 90 months you get the peak
april 2010 which was followed by the flash crash . go forward another 90 months
you get oct 2017 . i have been considering oct 2017 as a top of importance for a very long time . im begining to think that june 2016 is the better 4th wave low
in which case we are in the final 5th wave now . it doesn’t add up . the value line
bottomed with the dow in jan 2016 and june 2016 makes a better wave 2 than a wave 4 but either way this next decline should at a minimum take us back to the march lows . on the spx monthly chart wave 5 equals 1 at ( from june 2016 )
2524.38 . using the feb 2016 low to the high in wave 1 of 5 wave 3 would be 1.618
times wave 1 at 2478.61 . so it is possible that the spx runs higher to complete this 5th wave of its 3rd wave in the range of 2478.61-2524.38 . following that
peak it would drop back to 2322.25.
if that were to happen i would consider that a shallow decline of approximately
2000 down points ( crazy a 200 point drop in the spx would be considered shallow )
Bottom line : i am very open to a decline right now yet not everything is stretched
and the case can be made that we go higher .
Another oddity with the dow monthly chart .
in a crash wave C will many times be 2.2 to 3.2 times wave A.
using the 2000 top to the 2009 low or the 2007 top to the 2009 low .
the retracements have been 1.50 2.2 and the next line up of the 2.2 and 3.2
sit at dow 23367-23471.
the previous levels sat at 18062-18086 and stopped the market for over
a year so they do have merit from a long term perspective .
that leaves the dow with about 10 % to go . a lot of money and pain
if your short but really not much of a percentage move.
keeping my bearish outlook regardless and will trade the set up as they come.
im done
Joe
okay last post ( for real peter )
utility stocks are probably now in a bear market .
from the june 16th 2017 high we have wave 1 2 and 3 is probably near its low
we need to see waves 4 and 5 unfold to prove the bear trend has indeed begun
( i think it has ) following that we get wave 2 . the 710 level should be a guide for
the resistance for wave 4 . point being : i think we have begun the bear market
in many sectors its just going to take a while for all of them to line up for the
larger dump .
All for now
going to nail down my floor .
why i am concerned with the dow 5 minute chart
and why im saying the utilities are near a wave 3 low
of what will most likely become 5 waves down .
the daily chart is more important than the 5 minute
yet the math from my point of view in the wave counts
is always very similar . 5 waves is 5 waves and that doesn’t
change .
The utilities are leading the dow and transports down !
the rest above stands just pointing out the comparison
http://imgur.com/pu5dPm8
I exited all my short positions today. By my count we should have started a third wave down and since we clearly have not, my count is incorrect. I have learned that if you have to ask if a third wave is underway, it is not a third wave. Not sure what the market is doing but plan on waiting for a surrender of 2420 before re-entering short positions. NDX generally leads and is showing bullish price action today. On the sidelines for now.
Tesla. Looks like a first wave down shaping up. It needs to get down to about 290 and then do a second wave up to confirm. But the wave down looks impulsive.
Anybody saw what ORLY did today? (and AZO and AAP). All things automotive are toast! Butter ’em! 🙂
thanks peter
interesting chart with Tesla .
Same math and looking impulsive .
it closed below the 1.618 extension today .
i don’t follow the stock that much yet the daily chart
looks like a potential 3 of 3 instead of just a wave 3 .
i might take a bite out of corn tomorrow low .
Joe
where will the dow mini futures be 54 trading hours from
July 5 19:30 pdt its a complete repeat of we we just saw
in april and may .
a picture tells more than words
http://imgur.com/9pn2U5K
selling short emini dow at 21480 if touched ( 21486 a pivot )
not giving it much room yet it is head room and a guide .
better put 21486 a mental stop ( uh oh whats wrong )
sell 21465 with mental stop 21495 ( 21486-21490 double resistance )
30 pt risk ( no more than 40 )
cover at or below 21096 get long 20950 if seen gtc .
Joe,
As I showed in the chart show on Wednesday, NYSE and DOW appear to be in small ending diagonals. That’s still the case and I expect a new high before it’s all over.
Hi Peter,
Do you think we are still not done with 3rd wave and will make a new high before turning down for the fourth wave,
Bill,
I think we’re done with wave 3. That’s the wave structure is telling me (if you’re talking about NQ/ES. Not sure about DOW – the wave structure isn’t conclusive. It’s not really conclusive until ES gets below 2400.
Bill,
After several hours of analysis, I’m now leaning rather heavily towards a new high and yes, to finish wave 3. I didn’t want to lead you astray here. I shouldn’t have spoken until after I’d done the required work.
🙂
Thanks for the trade notes Joe. Looks like good plan.
I am watching them trying to buy back futures out of the red and sticking to my plan to sit things out until SPX takes out 2420 on a closing basis. The indices for the time being still under CB control it would seem….
Incredible as it seems, they are STILL relentlessly selling volatility on every little spike higher. That short position has now got to be the largest every accumulated in history.
Thanks peter
I placed my order in the overnight and went to bed .
i did not get filled .
with 42 trading hours to go based on the repeat cycle i posted
i m leaving my orders as stated .
my reasons are a bit odd perhaps but here they are .
July 20th is the end of quarter plus 20 day . That oddity has tended
to be near market turns for the past couple years .
30 days before the solar eclipse tends to be a market turn .
aug 21 solar eclipse minus 30 days is July 20th .
back in may i commented that i thought the drop was a contract
roll over , July 21 is the switch from the Sept contract to the DEC contract .
Mars Uranus cycle has a low due near July 15 yet the cycle low is in
Sept . I have not looked into the mercury retrograde cycle so cant
state the dates , it normally turns though 10 days after going retrograde
and is not always bearish .its august 12th to sept 5th from a quick look up.
10 days after aug 12th is aug 22. The Solar eclipse is going to be very important
and could end up as a low . the lunar eclipse aug 7th ? i think. would probably
be a high of sorts .
Right now what i think is going on is the year ending in 7 trade is being put on.
statistically from my work anyways June 30th would have been the high .
so the July 3rd high in the Dow is a hit ( i have my own 80 years of the decennial
pattern which i use ) mars Uranus cycle peaked june 30 th.
we are in a bearish cycle which runs into year end based on my planetary model
and yet mars Uranus is down into sept then up , were still in a Venus bull cycle until year end and the mars Uranus cycle does not actually peak in the longer term picture until June of next year .
Big picture aside : we are in a short term bear cycle and those who are trading
the year ending in 7 cycle would be entering short as of June 30th ( July 3rd the 5 minute 5 waves down was valid despite the a b c look )
add in utilities nearing its 3rd wave low and expected 4th wave bounce
( a weak bounce ) consider the similarity between april and may yet
consider we were in a bullish cycle then and a bearish cycle now and it makes
sense i did not get filled .
bear markets even minor cycle bears don’t let you exit longs favorably .
what my plan is to do based on my curiosity is to compare the moons
of april may to June July and also start to watch for this theme to repeat going forward . I know that doesn’t always work but its worth noting that when it does
you tend to get repeat cycles for months up to a few years when they do.
April 26 June 21 ??
may 18 July 20 ?
April 20 end of qtr plus 20 days
July 20 end of qtr plus 20 days
There is a cycle in this ( might not work but there is a cycle in this worth
watching out for is all im saying )
I hope your right peter and we do get a new high and not much further
of a drop but no bullish trades for me until atleast july 20
Andy’s Date ?? since it published : July 14 .
my 36 trade day chart next bar closes July 14
The down draft i was looking for in the chart i posted and the trade
i wanted yet has not been filled yet ?
it was calling for a 42 – 45 trading hours down draft . fairly short time period
for a decline .
that High is supposedly 39 trading hours from now .
ill give the market into Sunday to prove it to me right or wrong before
changes my orders .
In the mean time my order sits gtc to sell short at 21462 the emini dow .
My trading room will have a new floor in the next couple days and the
desk is build , the monitors will be installed into the wall .
i cant wait to get that put together . its a 10’x 10′ space inside a 20×20 ft
room . Its the final room to what was once junk . 1250 sq ft appraised at 0
when i bought this place ( 3306 sq ft total ) its been a lot of work .
Im guessing this year or next the tax man comes for a visit and re appraises
this much higher 🙁
Interesting move down today but not really displaying third wave momentum imho. Once again no real expansion of VIX BBs so I suspect unless that changes we may not have that much lower to go. If we get a long upper wick on the VIX candle tomorrow it could be a very brief downside move. I took a 15 point scalp on the move down still mostly on the sidelines above 2400.00
my transports bearish view on an hourly chart .
granted the 3 peaks domed house pattern is
a 2 year pattern yet i have seen it work on 1 minute
charts to as far out as a 10 year chart .
Like Elliott wave theory it works in many time frames
because it is very similar to Elliott wave theory .
Transports are entering or have entered a 3rd wave down .
the sideways movement is not textbook yet it was a 4th wave
triangle of sorts followed by 5 waves up . not getting anal with details
here so we can argue the minor if we choose yet the broad picture
paints a negative view for me on the overall market .
in short transports should get hit hard .
http://imgur.com/x0FUtJg
spx cash vs dow cash have 2 different wave counts
the drop on the dow futures is clearly a 3 wave drop .
both A and C are fairly equal .
im going to consider this though as A B C ( A )
and the rally coming if it comes as wave ( B ) .
spx cash has resistance at 2432.22 yet the spot
ill keep an eye on sits above that at 2439.17
above 2450.42 cash spx id say im wrong since
the spx should not really even go above 2442.96.
a b c x a b 1 is what im considering this as .
Keep in mind i m basing this on a bearish cycle
in effect .
face value we had an A B C decline which at this time
implies new highs .
not taking the bait as i see it as a fake out
( i might be wrong )
based on the assumption which is a bearish tilt .
spx had a complex wave ii and a simple wave iv .
wave i was simple wave ii an expanded flat
wave iii straight fwd wave iv simple and wave v of this minor i
ended today .
spx i am focused on july 3 to date . not going to get caught up
in what happened prior to that on the short term chart .
17 trading hours down in the cash index ( 1/2 of fib 34 )
.382 time retrace would be near end of day Friday .
.786 time retrace would be late Monday .
Tomorrow should be an up day
im leaving everything as i have .
no trading until Sunday at the earliest
sell order stays in place at 21462 which be end up being
changed .
see you next week
Looks to me like nested first and second waves building. I think we get yet another second wave bounce tomorrow and possibly a green candle, with the real downside action starting next week. Knowing the way the banksters operate, they will very likely ramp prices up at the open to dislodge as many bears as they can by keeping prices aloft into the close.
i doubt my sell order will be filled at 21462
i also think the target down to 21096 as well as 20950
are valid .
if the dow mini goes below that range though
more downside toward 20368 .
need to break back above 21296-21298 to give any kind
of buy signal .
i am no fan of expanding triangles nor am i calling this one
but if we are in one 21138 should be taken out .
the swing low at 21266 in the overnight futures should hold
better put really needs to hold give me any reason to consider
a bullish trade yet a break through 21296-21298 is the signal
of a low in place .
sitting this out till Sunday and doubting we see 21462 any time soon.
the alternate crazy wave count is we are in a triangle yet it is complex
and impossible to consider it valid untill all the swings unfold .
dow future June 19th would be labeled the high
wave A was complex yet to keep it simple its the low june 29th
( i dont count it as such but keeping it simple )
wave B the all time high on July 3rd and we are in wave C now .
since triangles tend to test the outer boundaries in terms of
retracements , ill watch the .786 and .886 retrace for wave C.
wave C of a triangle though can break below wave A .
the count im looking at is A expanding triangle B and we are
now in wave C . how this plays out im open for what ever comes
yet im seeing some bothersome price projections .
no way i am interested in buying this market right now .
off to bed
I agree with you about that new all time high. It really looked like b wave action to me and not the end of a regular impulse. Andy Pancholi has been sounding the alarm and is actually offering a one time offer for his July MTR to non-subscribers about what could be just ahead. A great price at half off.
i have never seen this pattern unfold before as the one i see
in the dow futures from june 19th to date .
i can simplify it but i have not seen it unfold before so
for what its worth .
we are in a bearish cycle and what comes next looks ugly
short term im not convinced we see much above 21333 in the
foreseeable future .
plan for an ugly market is how i look at it right now .
the move up from june 2016 is over as i see it .
the question i wrestle with is timing vs wave count
and the wave count tends to win .
there is 5 waves up from june 2016
the move from July 2014 to June 2016 was a sideways move.
there was 2 inverted head and shoulders measured objective
on the cash dow ,21148-21649 . we hit that range and we did so
completing a 5 wave move . before i get caught up in the extreme bear
count calling the bull market over ( which i am seriously considering )
there is support at 20492 on a closing basis and the possibility we go
sideways for a few month with the 20492 level being tested yet holding .
then we go higher up towards 23580-24000 into year end .
on the other hand .
the decennial pattern called for a high June 30th along with the other cycles i have mentioned , the decennial pattern i use as a guide yet i use my timing
models more so for trading turn dates .
that said : 21060-21052 is a key level on a closing basis .
june 19th is the closing high in the dow .
closing below 21260 targets 20990 on a closing basis .
the decennial pattern is saying based on yesterdays close the market should
close at 21447.87 on july 11th . is statistics is all using historical % moves.
its a guide . july 11th is the turn date on my timing model and july 14th is the date of the next 36 trade day chart.
now here is the deal , the decennial pattern is saying the dow will go
to 17,626 ( No TYPO ) by sept 25th and the mars Uranus cycle is pointing down
into Sept 15th .
so for what its worth , you can bet your skippy peanut butter i am very concerned with the difference between the jan 2016 low and the june 2016 low
because if the june 2016 low was the true end of wave 4 then this bull market
is completely over .
the June 2016 low was 17063.08.
i want to be wrong and i want to be very wrong .
we are at an inflection point and i would not take this bull market for granted
any more . i felt the same way today as i did the day the market peaked in Oct 2007. no joking here yet sorry for the rant .
please everyone be careful
see you next week
last post .
typically once you see a 5 wave move you look for a .382 time retrace as well as a .786 time retrace . these are my guides.
june 2016 to july 2017 was 13 months , 13 months *.382 is 4.96
this targets November for the ratio .
the math fits the model .
worst case buy a lotto ticket on an out of the money option and don’t get aggressive and let it run if this market gets ugly .
call it a hedge and use beer money you can afford to lose .
keep an eye on the 20492 level yet get hedged sooner rather than later .
trade what you see not what you think .
and now that i have freaked out worrying about the end of the world
rally please !
no joke to the above im dead serious
night
Joe,
Could you explain the 4.96 = .382… which gives you November time frame….but above that you mention you expect a .786 time retrace. Are you saying that November does not work expect Feb-March time retrace?
The thing I find fascinating about all this Joe is nobody, and I mean NOBODY!!, is calling a top in this market. There is absolutely universal agreement among pundits that we are now in a corrective wave and we have at least one more wave up to new all time highs. I have even seen predictions from people I think are able analysts that call for a “melt-up” move with indices literally doubling from these levels. Many are expecting some sort of blow-off” top with very obvious price/breadth diversion. The standard argument cited is that that is the way all previous bull market have ended and therefore this one will be no different. Meanwhile, we have a pretty serious Hindenburg Omen on the clock, and people like Andy Pancholi and Martin Armstrong hinting at something huge just around the corner. My own thinking is that the distortion in these markets has been nothing short of criminal, especially when you look at the insane way volatility has been un-naturally suppressed for unprecedented periods. Somebody is sooner or later going to have to pay the piper. I completely agree that it going to be very, very ugly. I also think it is going to take an awful lot of folk by surprise.
june 2016 to july 2017 was 13 months
13 Times .382 = 4.96
so july plus 5 months basically equals nov .
i know it really means dec but my chart labels it as nov .
and i think i got a bit worked up but for good reasons.
the nasdaq 100 and nasdaq comp do not show 5 up
yet the rest of what i was looking at did .
what i was saying is that i look at both the .382 and .786 time retracements
after a 5 wave move . those 2 have been the most consistent .
there is more to it but that is the simple version .
you can grid your chart , .382 .50 .618 .786 using both price retrace
and time retrace but on a wave wave structure .
the snap back tends to hit the .382 time and price then the .786 time and price
then a break out on short term charts .
yet in longer term charts i just look at the .382 and .786 as a timing guideline .
my point though is this market is beginning to scare me and having been on this site for almost 2 years i have been a die hard bull the entire time .
10 bars up in 5 waves would be 3.8 bars down and 7.8 bars down
then back to the upside afterwords . on the other hand 10 bars down in 5 waves
id look for a high 3.8 bars later and 7.8 bars later as a guide .
.382 and .786 .
Thank YOU!!
.382 .50 and .786 i look at the most yet i look at then only following a 5 wave move
and it is for short term trades on intraday charts .
its something to be aware of is all .
a couple examples would be the last 5 waves up on the dow 5 minute chart
on july 3rd and the first 5 down .
the .50 time retrace caught the low of wave 3 down then the market bounced in wave 4 and dropped into wave 5 .
the .382 called for a high near the open and we got just less than .382 retrace in both time and price and reversed to the downside . that’s what pisses me off
i planned for the trade and wasn’t paying attention and let it get away from me.
another example in real time yet not a completed 5 down would be the daily utility index .
you can see waves 1 2 and 3 yet no 4 or 5 .
wave 3 lasted ( if it bottomed yesterday ) 7 trade days
if you count the high in wave 2 and the bottom in wave 3 you will count 8 bars.
7 days time .382 equals 2.67 days 8 days times .382 equals 3.05 days
7 days times .786 = 5.5 days and 8 days = 6.2 days .
basically this implies wave 4 lasts 2 1/2 to 6 days and price should
end up somewhere near .382 retrace of wave 1 through 3 and .50 of just wave 3
yet the 1.618 extension from waves 1 and 2 sits at 710 and the .382 of waves 1 through 3 and the .50 of just wave 3 sits at 713-716.
to sum this up . the bounce in the utilities index $util should only last
2 1/2 to 6 days max and should not get above 716 or id say something is wrong .
then once wave 4 ends ( if this is an impulse forming ) then ill do the same thing all over from top to bottom since it would be a completed 5.
oh and lastly , if you look at the daily utilities index look at the last 5 waves up
from may 11 th to June 16th as a decent example as well . that move lasted
25 trading days by my chart ( im using the bar counter ) 25 trade days times .382
equals 9.55 , count 9-10 trade days following the the June 16th you will see the June 29 low . yes they have fallen a bit further yet you got a slight bounce out of it the following day .the .786 is in 6 trade days and i doubt its going to call a low based on my view of the wave count .
lol i knew the futures run dammit . glad my powder is dry though .
spx chart just for grins . im using an hourly chart from july 3rd to the close yesterday , spx not futures . yes it is a sloppy 5 but i want to show the time lines
just so you can grasp what im saying .
i do this 2 different ways because of my charts , i look at a 24 hour chart and a regular market session chart . you don’t get 24 hour trading on the spx but just saying for info . we had 17 hours down in 5 waves ( yes it is debatable )
the 24 hour chart would be 18 hours by my data .
.382 times 17 as well as 18 equals 6.494 and 6.876 this implies a rally for the entire day today right into the close . ( 6.494 hours is the entire trading day )
the .786 times 17 or 18 trading hours would be 13.362-14.14 trading hours .
this gives another time band for the maximum time period into Mondays close
and possibly into Tuesday .
so lets see if the spx can close at its highest tick right at the close .
keep in mind i also look at other timing methods yet this one ive explained
all for now
hope that helps
you need to play around with it and also realize nothing is perfect but i have
been doing that for a very long time .
joe
well verne
ill tell you i have over 80 years of price data i put into a spread sheet
because i wanted to understand the decennial pattern . i figured if there was anything to it id run every 10 year period i could .
the data in 1927 or 1928 and i ran each days data and converted it to percent moves and it is pretty impressive . so each each day i simply put in the daily close
and it runs the average percent moves and plots them on the chart .
it gives me dates and price and i compare it to the timing model .
after July 11th the proof will be in the pudding because it points straight down.
just because it is a statistic though does not mean it will work .
ill just say i will not be surprised by a steeper decline then most expect
and i will not be surprised if it turns out we are in a bear market .
i wont bet the farm on a crash though expecting to get rich .
peter still thinks another leg higher and i respect his work .
Armstrong is super bullish if you read what he says in detail .
for me its a matter of adjusting my mind set from bullish to bearish yet also keeping my head on straight .
i will be short to some degree next week and if the market does turn down
ill just hold it .
basically pick your risk tolerance decide where your right or wrong
get in hold until your target is hit and if things get really ugly hold .
the worst thing you can do in a crash type move is try to day trade
as i see it anyways . i have done much better by holding stocks long
than trying to trade .
my short position wont kill me if i m stopped out and if the market runs higher
so be it ill come out ok either way .
i view the short as a hedge , not dumping everything i own at this point .
that all said
i still think we are better served expecting an ugly market
and i do hope im wrong
spx tested the .382 retrace and stalled .
i consider today so far constructive and not going to trade
just want to focus on other things and get tuned in over the weekend .
1927 by the way was a bullish year
don’t get caught up in years ending in 7
Your point about statistics is well taken. People often forget when it comes to predicting likely market moves we are talking about probabilities not certainties.
I have pretty much given up on the indices as I think they are subject to way too much CB intervention and machine trading to trade profitably with any consistency. I am focusing on sectors that are clearly trending such as automotive stocks and oil. At some point the downward momentum in the indices will render attempts at intervention futile but we are not there yet. I am content to wait.
Verne,
Did we have a valid Hindenburg Omen again on Friday? I think we did if the McClellan Oscillator was negative.
I have not looked at the new lows and highs but it would not surprise me in the least if we did. I just hope that when this thing finally breaks there will be an opportunity to get positioned. We could get a nasty gap down.
There is clearly stealthy distribution going on with this rounded top we are seeing in SPX. The selling is being done very carefully, but selling nonetheless as we now have a well-defined descending channel. It is quite a cat and mouse game we are witnessing and God only knows how long it can continue. I would really like to see an outside reversal day as we did with NDX as opposed to an after hours blood letting. We’ll see I guess.
i guess im not the only one a bit freaked out
you can read the entire article here
https://new.mmacycles.com/index.php?route=blog/article&category_id=1&article_id=150
yet this was what i considered the highlight :
well put put Raymond !
This column has said it before and will say it again: the period from mid-May through September is a very dangerous time. It is a time that is charged with very high emotions and the temptation to act impulsively. Yes, it can also be a time of great inspiration, electrifying new thoughts, and pioneering actions. But to succeed, one also needs discipline and self-control. Otherwise, matters can unravel very quickly, and markets can exhibit very sharp price movements in very short periods of time. We have the grand cardinal cross in effect now through July 20, followed by the Sun/Mars conjunction in early Leo, a fire sign, July 26. That is followed by the total solar eclipse of August 21, and then the final Jupiter/Uranus opposition of September 27.
It is said that we live in interesting times. Whoever said that had no idea of what today would be like. This is what I would call the beginning of a very interesting time – a very interesting summer. We will learn much about the nature of Mars correlating with human behavior this summer, as it pertains to world leaders, financial markets, and ourselves.
On the bright side, we have lived in other interesting times, and made it through. Think of it as a learning experience, a valuable educational period – with a lot of tests. And Mars loves to compete. It doesn’t accept failure or defeat. Those are just temporary states that will have to be – and will be – corrected. Mars has confidence. With Jupiter, however, it can be over-confidence (macho confidence), and that’s where the danger in judgment – being judgmental – also comes in. This is one of those times that will challenge every one of us to practice being non-judgmental. Add that to the list, starting with discipline and self-control, as requirements to succeed under this cosmic exam.
I also spent a little time carefully looking at the support and resistance levels of SPX the past few weeks and I have to say I agree with Peter that we are going to see a new high. The 2400-2420 has proven very strong report and simply refuses to fall so that is telling us something very important. One of the things I like to look for for confirmation of a trend change at this degree is a decisive and swift breach of a clearly defined prior area of resistance/ support. In the vast majority of cases I have seen, when those pivots fail to give way to an initial decline, the original trend is not done. The real deal will see those pivots decisively broken, and at that most a brief return to back test before resumption of the new direction. That fact that SPX has not done this seems to me prima facie evidence that we are very likely to see a new high before we see an end to the current upward move. It remains my expectation that the new downtrend will announce itself with a decisive break of 2400 and not before.
Verne,
Could you help me find the “link” you provided weeks ago detailing the Hindenburg Omen? I went back and searched this site for 2 months and could find that link! It must have been taken down!
I searched Dr. McHugh’s site…but was able to find the updated link you provided!
Your help would be appreciated!
Here is Dr McHugh’s article.
https://www.technicalindicatorindex.com/subscribers/guest-articles/Hindenburg%20Article%20June%205th%2C%202017%20McHugh%20backup.pdf
Thank you!
Ed what did your analysis of Friday reveal? HO, yes or no?
Sorry Jeff …I don’t have the McClellan Oscillator study in my software package! If it was in negative territory then I believe we did!robert McHugh will comment on his weekend update and I will let you know that he says.
Jeff T,
We did get the 7th HO on Friday per Robert McHugh!
Most welcome. On the website you can find the article in the left column under “Guest Articles”.
I have not checked to see what % of the total issues traded the highs and lows were Friday but the MO was definitely in negative territory.
A new weekend post is live at: https://worldcyclesinstitute.com/cycles-and-the-ticking-time-bomb/
This website is for educational purposes relating to Elliott Wave, natural cycles, and the Quantum Revolution (Great Awakening). I welcome questions or comments about any of these subjects. Due to a heavy schedule, I may not have the time to answer questions that relate to my area of expertise.
I reserve the right to remove any comment that is deemed negative, is unhelpful, or off-topic. Such comments may be removed.
Want to comment? You need to be logged in to comment. You can register here.