It is interesting to see the many bullish ideas of the DJI & SPX since the recent correction. My own view has not changed in that this correction marks the start of a much bigger correction lasting a couple of years or so. This chart zooms in to the current correction of wave 1 Blue which I believe is taking the form of an expanded flat which may complete soon at the 61.8% retrace level. I do not think that wave B of the flat is wave 5 of the impulse down from the top as wave 5 would be out of proportion to wave 1 where wave 3 is extended as in this case. Time will tell probably next week! Good Luck.
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Intermediate wave (2) has now completed and Intermediate wave (3) is underway. A break of the red line will signal a large fall! Good Luck
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Minor wave 2 has risen further than expected but may conclude at the 61.8% fib line and the conjunction of 2 trend lines. RSI is overbought and momentum divergence is evident.
I agree with the thesis of your analysis, and I appreciate your unique perspective in this post.
It is rather incredulous that after a "collapse" of a parabolic rise in the Dow
earlier this month that mass psychology, as measured by the very rapid descent of the VIX would turn so quickly.
It appears that perhaps the majority now view the correction over,
The NDX 100 Index of technology stocks is within earshot of the all time high,... as if tech can rescue the entire market.
To me, this is a potent recipe for another collapse in the market,.. sometime when it's least expected. But,..it may not happen immediately.
The parabolic collapse in my opinion was genuineand has only begun the process of "distribution" at higher levels,
as volume (OBV) on the rally , what I would call the "quality of the rally "is not taking price as high as expected
Watch first.. for a CLOSE below Dow 25100, and more importantly a close below Dow 24601.27,
before... Aggressively... shorting the Dow, for a new leg down,
which will definitely panic the masses again, being so unexpected when it occurs, as the next time down, they will all become
true believers on the Downside.
THE_UNWIND
Geofftv1
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@The_Unwind, thanks for your insight, the MSM certainly think the recent correction was a blip and as usual are urging buying the dips. Note the continous unease about the state of Deutse Bank and the possibility of collapse triggering a Tsunami panic.