SalN
Long

S&P 500 and possible VIX play

TVC:SPX   S&P 500
4 hour chart for S&P 500            

So as promised, here is my take on the S&P 500             and where I see things moving in the next two months.

I feel very confident that we have just completed the 4th corrective wave of this 5 wave impulse. As you can see, this 4th wave is shallow and complicated. And the 2nd wave (Brexit) is deep and cleaner. So all that is left is the 5th wave. I placed OI options price targets in the chart. I also measured what 50% and 75% gain of the 3rd wave would take us as far as the 5th wave is concerned. For the 50% growth price target, we would reach 2215-2216. For the 75% growth price target, we would reach 2240. However, price action will dictate the final outcome. I also measured the amount of time in days and bars for wave 3.

So what my analysis is pointing to, and what I am leaning towards, is a micro 5 wave growth, topping around the 2215 range (red line). I just don’t think we go much higher because it seems too steep for those OI price targets. Either way, it appears that we will make all time highs. (blue line signifies the last high) ATH’s will help solidify the Feds decision to raise rates as they would not raise rates if the market showed weakness like it has this last couple weeks. It appears we top around the end of November and start a steep ABC correction, with C being the big one that would coincide with the Interest Rate hike.

Unless we get a black swan event that triggers this fall (doubtful) I am pretty sure they raise rates in December. So I will be playing the VIX             at the end of November. If anything changes then I will update this post.
And just to touch on Yellens latest comments. Of course she and others are going to start to be Dovish. They want the market to go up so they can raise rates. Talking like she is uncertain is BS and helps kick start this 5th wave.

So there it is, short and sweet. Hope you like it and hope it is helpful.
Comment: Sorry but I forgot to add one more thing. added daily chart to this update.

The Fib retracement for the whole entire move from back last August to my 2215 price level brings the 61% retracement down to that very long term trend line. Its actually a double line. The bottom of the two lines is the measurement of the bottom of the wicks. So if we hit 2215, then that is coincidently a perfect fit. When I saw that I was surprised but felt confident of my analysis.

Lastly, cyclically speaking, we would be due for a ICL (intermediate cycle low) for the stock market. I knew I forgot more stuff, but It was late and I was tired. hope this is even more helpful.
Comment:
snapshot
Comment: Well Fischer just spoke. He is usually very hawkish. This is about the most dovish we will hear from him. Expressing concerns about the all around economy and world economy. They will still raise rates, they will just talk more dovishly on the run up to help propel the market higher.
I like your work. Mark my words here, they will not hike this year. lower GDP and CPI numbers due to the stronger Dollar will hand cuff them. Guess what, you last wave down in Nov is when CPI numbers comes out and thats when hike conversation is off the table.
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Interesting, what is intermediate cycle low?
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SalN PRO JunaidiChen
Everything runs in cycles but not perfectly. There are short term cycles call daily cycles there's half cycles there are much longer intermediate cycles. it would probably be better if you googled it
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Good day. How do you use 50% and 75% measurement to get the 5th wave?
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SalN PRO JunaidiChen
I took a Fibonacci measurement of the 3rd wave and moved it to the start of the 5th wave (I believe we just started the 5th). If the 3rd wave cannot be the shortest and the 5th wave is usually anywhere from 50% to 99% (except for commodities) of the 3rd wave, then there you have it. Its just a guide for possible price range at the top of the 5th wave move. I will be looking for the Volume to start drying up and a possible little bit of a rounding top. But what I think might happen, is one little one day push higher, which would make people want to go long, but is just a bull trap setup for this fall. I will be looking for that around the end of November. Then I am probably buying into the Vix to play the first A drop and then out to wait for the C drop.

Hope that helps
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Thanks:) Just wondering, how would you derive A, B, C all the way into 2017?
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SalN PRO JunaidiChen
ABC correction comes after the five wave push. I looked at the ABC correction from the December 2015 rate hike which started just prior to the rate hike and also used open interests price targets to come up with that Idea.
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