We have entered the corrective 4th wave after a nice bull run on the 3rd wave (see impulse waves in pink).
Per Elliott Wave Theory, if 2nd wave retracement is minimal, then 4th wave retracement will be much larger.
In this scenario, the 2nd wave retraced to 0.382 fib. As such, we expect 4th wave retracement to be as much as 0.618 fib.
We have bounced off the 0.382 fib and if that breaks down then expect to see it fall down to 0.5 fib (i.e 2431).
Worst case would be a bounce off of 0.618 fib (i.e. 2328).
Note: Any future projections at a larger scale shown here will not accurately indicate when those waves will end or commence. Charts always need to be updated as we get more data from the market.
Disclaimer For informational purposes only and not deemed as financial advice
nice chart, is your target still 2300-2450? I think we may bounce from 2420 ish, and you think we will have a NTH in the future? i am preparing big money for a long trade
modernpicasso
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We have started the C subwave of this Wave 4 correction. Still on target for targets shown above. I entered a position in the leveraged S&P Bear ETF when SPX was at around 2780.
shawn.ctech
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Dead on. Im coming up with the same exact analysis.
modernpicasso
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@shawn.ctech, glad to hear some confirmation from others! let's see how this plays out!
shawn.ctech
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@modernpicasso, This last wave got really extended, last year i thought we would start the recession mid 2018 but most likely it will roll into the beginning of 2019 and correction should roll into 2020.
modernpicasso
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@shawn.ctech, yeah that makes sense. I expect this correction to be just a warning of whats to come later down the road. Will definitely need to be cautious and ready for the next major crash. I also do think it should come about in the general time frame you have indicated.