Friday, August 22, 2014

Primary Wave Count Change: This Bull Market May Have Many Years Left

I am not returning to posting on the blog, but wanted to update my prior LONG TERM wave count. 

I am switching that wave count to my alternate. My revised Long Term Elliott Wave count is that we are doing a fractal of the 1920s.



This count previously was my alternate.  It should chop this blue megaphone area on a quarterly basis and run into the Year 2020s.  The Dow 35k price target is not exact but in the neighborhood.  


The reason for the change in long term count is that IWM has traded sideways for 9 months and held support. Chart: 



This is a simple continuation of this blog's belief that the Nov. 2012 low is the key low and marked the end of the correction.  Under that belief, we are either in a wave 5 or a wave 1 from the November 2012 low.  My prior primary was that we were in a wave 5. My new primary is the alternate wave 1 count.  

Until that 2012 low breaks, there is no reason to think Long Term bearishness in my opinion. This bull market may have many more years left in it.


 photo HOW_THE_MAYANS_WERE_RIGHT_zps3ba6d008.png





 photo END_IT_zps58e55a8c.png


 photo DANERIC_zpsf6b3d4b7.png



This is a long term count and obviously means nothing for the next month.

I am not returning to posting.  I wanted to update this long term view change. There is always a bear path and a bull path. We cannot know which path the future will choose. As always, do your own due diligence, read the disclaimer, and make your own investment decisions.

Take care,

Peace, Om,
SoulJester

Wednesday, June 11, 2014

End of the Bull Market. I will return in 2016.

Trust thyself: every heart vibrates to that iron string. Accept the place the divine providence has found for you, the society of your contemporaries, the connection of events. Great men have always done so, and confided themselves childlike to the genius of their age, betraying their perception that the absolutely trustworthy was seated at their heart, working through their hands, predominating in all their being. And we are now men, and must accept in the highest mind the same transcendent destiny; and not minors and invalids in a protected corner, not cowards fleeing before a revolution, but guides, redeemers, and benefactors, obeying the Almighty effort, and advancing on Chaos and the Dark.

-Ralph Waldo Emerson, Self Reliance

********

I have enjoyed my time away from posting. This is a good time for me to take some permanent time off. I will return in 2016. The evidence of a significant top is too overwhelming here. That it is happening where the bear market should resume from a Fibonacci perspective should not be ignored. 

I forecast that the bull market has been on its last legs. I started by identifying the top in small caps to within a fraction of 1 point. March 4 Top Call Update. On May 29, I identified the topping Fibonacci resistance in large caps. End of the Bull Market. 

The S&P 500 has spiked through its long term resistance area briefly in the last week or so, but the Dow has not. I identified the ideal time and price and noted the Dow level. Ideal Time and Price. 

Currently, we have hit the time window. We did not quite hit the price window. Nothing really changes.  The Dow either has failed or will fail in the 17,150 area is my forecast on the chart update noted in the Ideal Time and Price post. 

The market failing at the 138.2 extension (Dow 17,150) is bearish. Such a failure projects a retrace of the 2009 lows and a likely lower low below that low.  

What most do not realize is that the top in 2011 was the return of the bear market. However, it morphed into a triangle. This is shown on the chart below and has been the thesis of the Long Term Bull Market versus Bear Market scenarios that I have been talking about on this blog. I had last year hoped that we would get a back test of the breakout and confirm the Bull Scenario, but the market went into bubble mode instead, flying up to its Fibonacci resistance.  


This triangle in the above chart does not show up well on large caps (though it is there) because they are more sensitive to the dollar manipulation. It does show up on small caps charts, however. The import of this triangle is it is likely a B wave in an ABC up. That means the market should end at the 138.2 as ABCs are corrective. That is why the extreme readings at the Fibonacci resistance we are seeing right now are so important here. We will very very likely not do another triangle. 

When we break the 2012 low that will be additional corroboration that this is just been a corrective wave in an ongoing larger bearish corrective pattern as outlined in the posts linked to this post. The only Bull Scenario under this triangle thesis is that the triangle was the end of a complex correction and the new bull began in 2012. That has been the competing bull market scenario. This Fibonacci resistance and the readings we are seeing is telling me that the Bear Scenario is the primary scenario here. 

From a stop perspective, I am relying heavily on the Dow Transports, which are at their measured time move on two different degrees:



The above chart was posted as part of the analysis in the May 29, Dow Transports Post.  Accordingly, that time relationship should provide measured move exhaustion. It would take a couple quarters closing above this quarters' candle for me to take the Bear Scenario off the table. 



JUNE 19, 2014 UPDATE

Today the S&P 500 hit the 1960 price target that, as noted in the original post above, had been missing. 1960 Price Target. We are also nearing quarter end. I wanted to add some charts to what is my last post until 2016 to provide further context.

First, the long term count shows that since 1982 the market has been carving out a fractal of the prior impulse wave up from the 1940s. Here is the long term count:


For now I am following the Wave B count, but my primary is in orange and has us finishing a wave 5 at some degree. What comes after that wave 5, I am not sure. For that reason, ignore the red extrapolation going forward as that is merely for purposes of following along. I hope to be able to reject or confirm the Wave B count that I am currently following based upon how we react at the various fib levels. Analytically, if this is an end of a 5th wave, which I think it is, there is a possibility that it is extremely bearish as it could be the end of a larger degree 5th wave which would mean we will correct the entire wave up from the 1930s, or possibly more. I am not going to think about such things as the correct thing is to first just follow a retrace of the prior 5 waves up, which would be a retrace of the 1982 wave bull wave. 

A long term count though valuable, is difficult to trade. However, the S&P 100 Index (OEX) has given us the level here. Bulls are currently safe above this quarter's candle in the chart below. It is chart conditions like this that are the reason I said I would need a couple quarters to close above the current level to take the bearish scenarios off the chart. If the long term count above is right (either the Wave B or the primary end of a fifth wave count), we should experience a failed breakout on the OEX. Here is the chart and setup:


You can find similar breakouts on the other charts, and follow those for a similar breakdown, to see how the quarterly candle provides the support line. Now, if the overwhelming top evidence is correct and that failed breakout triggers on OEX, I will be watching for confirmation. The confirmation will come when the market charts start breaking down. For example, I will look for a break of the lower Monthly trajectory line in Tech:


I will look for the same breakdown on other charts, such as the NYSE:



I hope this is some value over the next year or so whether we get confirmation or the bull holds serve at the support lines. I have enjoyed blogging my market analysis and do plan to return in 2016. With the birth of my daughter this spring (which is why I ceased doing regular updates), I am looking forward to spending my extra time enjoying that little miracle. I have deleted my Twitter and other blog profiles, but will continue to haunt some of the blogs I enjoy reading and post there from time to time. Hope to see you all around, and I look forward to posting again on this blog in 2016.

There is always a bear path and a bull path. We cannot know which path the future will choose. As always, do your own due diligence, read the disclaimer, and make your own investment decisions.

Take care,

Peace, Om,
SoulJester

  

Tuesday, June 10, 2014

IWM provides a level and a road map.

Today we hit the ideal time window, but have not hit the ideal price. This could be all, or we may still have a smidge to go on price. Ideal Time and Price.  IWM continues to give us the levels and the playbook as it has since the March 4, Top Call Accurate within .36 IWM Points.  

Currently IWM is sporting a potential breakout pattern. Here is the chart:


As you can see from the chart above we have peaked above the blue line. This is the import of that move. We have the 2011 setup, and the indicators match. For the bearish scenario, we want to see IWM follow that 2011 fractal and break back down this week or next week below its Weekly cloud baseline at 113.93. If IWM instead holds that baseline, we know we are in a bullish move and the stop is right here below us (from a weekly perspective).

I am posting the level because it is instructive, not for any other reason.  I am following the bearish scenario for the reasons I have outlined, but this is a nice level to read that it is either right or wrong.  

There is always a bear path and a bull path. We cannot know which path our future will choose. As always, do your own due diligence, read the disclaimer, and make your own investment decisions.

I hope your summer is treating you well. Posting will continue to be sporadic.

Peace, Om,
SoulJester


Friday, June 6, 2014

Ideal Top: Tuesday June 10 at SPX 1960. Targets 1755-70 by August 13

This move above 1920 suprised me. Given that we have pierced the 138.2 fib resistance, I am taking the end of the bull market scenario off the table. It is still viable, I suppose, but that fib resistance was sliced through enough that I no longer trust it.  [SEE EDIT BELOW]

That puts me back to where I was, which was anticipating a a move to the 1700s.  I have run the simple ABC swing pattern. The ideal top is Tuesday at 1960. We could top sooner, but that is the ideal. From there, I am looking for a move to the 61.8 fib support by August 13.  I expect weakness into end of June per prior cycle work, so that will be a decent time to reassess.


Here is the Daily SPX swing chart:




EDIT, JUNE 6, 2014. I looked at the DOW, and the 138.2 fib resistance (along with a 161.8 and a big channel) is right in this area. Accordingly, the End of the Bull Market is Still On the Table.





We have failed at that red upper channel line the last two attempts.  And the Dow Jones Transport Index has hit its Time Reversal Quarter.


This is occurring while Investor Intelligence has Bulls at 62% (chart courtesy of DecisionPoint):




There is always a bull path and a bear path.  We cannot know which path our future will choose. As always, do your own due diligence, read the disclaimer, and make your own investment decisions.


Hope your summer is going well.  


Peace, Om,

SoulJester


Thursday, May 29, 2014

END OF THE BULL MARKET

Here is the chart and the level we have been talking about for some time:


There is always a bear path and a bull path. We cannot know which path our future will choose. As always, do your own due diligence, read the disclaimer, and make your own investment decisions.

Peace, Om,
SoulJester