Still looking for the 5th wave to form and then to be followed by a crash move. The next 3 months are likely going to be brutal. I don't think Congress reaches a deal for new stimulus by the August 10th recess one week from now. I think that will tank the market along a other reasons I listed in my last post.
Again, I think we bounce higher first, to finish the 5th wave and once its done, a crash will follow. I think SPX will attempt to fill the gap at 3328. Once done the crash should begin. I do believe that the next crash will be worse than the Feb crash. My market breadth indicators are flashing the same warning signs they did back February.
If we selloff and take out the 50 % fib retracement of the last bull market at 2030, then the 2016 comes into place at 1810. We take out that level of support the 78.6 fib will likely be tested at 1708.
Here they are again:
The catalysts for the next selloff:
The election (uncertainty) Covid-19 cases trending higher On July 30th we got a contraction in Q2 GDP officially moving the US into a recession Q2 Earnings US-China tensions Trump has scrapped plans for a phase 2 deal with China Stimulus Effect Wearing Off The extra $600 a week in unemployment benefits is now over New State Lockdowns New Stimulus Delay Uptick in Unemployment with New Lockdowns
@The_Chart_Pattern_Trader, I see the gap, was focused on SPY not SPX everyone is focused on that gap at the top but there are several gaps in the V on the way back up. The lowest gap at around 230 on SPY.
Sonic_scheme
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the official announcement was already announce in February for recession. This is the strongest market in a recession
The_Chart_Pattern_Trader
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@Sonic_scheme, Agreed! The market rally has been so strong on SPX for 2 reasons.
1) The distortions on SPX, being mostly controlled by the top 15 stocks. Most stocks in the market peaked back in June.
2) Second, due to heavy government intervention and heavy intervention by the Fed with Q.E.