The SPX since the 8/15/16 top could be forming an Elliott wave Expanding Flat. In this corrective pattern the initial decline is in three waves followed by a three wave rally that exceeds the point of origin of the three wave decline. In this case its the SPX top at 2193.80 made on 8/15/16.
In Expanding Flats the most likely Fibonacci relationship of the three wave rally to the preceding three wave decline is 1.236. This targets SPX 2219.70 as the likely target for what would be labeled as wave "B" within the supposed wave "B" wave "a" x .618 = 60.90 + b = SPX 2212.10 2212 to 2219 is the resistance zone.
If the SPX makes a top in this zone, the subsequent move down would probably reach at a minimum just below SPX 2083.80. If there is a peak in the 2212-2219 zone I will have a follow up post about this wave count.
**** One final note in my recent posts on the DJIA I had been labeling the Horizontal Triangle as wave (4). I'm changing the label of the Horizontal Triangle to wave "b" because the DJIA appears to be taking the same Elliott wave pattern as the SPX.****
My next post will detail some very interesting developments on the SPX intraday wave count.
Mark
Comments
ahmetnmsl
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hello. i dont know about EW too much.. but can you check if this count is correct or not ?
Thanks for the help.. It says this is an ending diagonal case for Dow.
markrivest
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Hi
The count illustrated at both those links is a valid alternate wave count. In Elliott wave theory there are always at least two possible wave counts, sometimes more.
Note that on my SPX resistance chart I label the August 15th top as 3? Meaning that this peak could be a third wave in a developing five waves up, this would be the Ending Diagonal Triangle illustrated I those links.
The reason I put a question mark at the 8/15/16 top is that some momentum indicators are bullish. Also stocks are now in a seasonal bullish time until at least April.
With mixed signal I believe it is premature to call any near term peak the prelude to a decline all the way back down to the lows made in Jan - Feb 2016.
The count I think could be developing would lead to an intermediate decline to the mid- 2000 area on the SPX.
If more bearish evidence were to develop there could be a move down much further, other wise it is too early to get super bearish on the US stock market.
This one is a prediction from August : imgur.com/NLfZ5og
This one is from Nov. 10th : imgur.com/vsEQUuL
Thanks for the help.. It says this is an ending diagonal case for Dow.