Right now it is overshooting the pale green trend channel. The pale green channel represents a medium term trend, which started in 2010. This is most likely a 3rd elliott wave of primary degree.
An overshooting of their equivalent medium term trend channels can also be observed in the Dow Industrials as well as in the Nasdaq 100. This action is usually observable at the very end of trends or right in the middle of trends, which form another (stronger) trend of their own (3rd elliott waves e.g.). It is highly unlikely that the latter is the case here. The primary reason being a 7-year old trend to the upside. It lead to strong overconfidence among equity investors today. This is represented by 5 elliott waves into the direction of this trend.
Nevertheless, it is also highly unlikely that the market crashes on Monday. We do see some more upside despite the state of the market. There is not a potentially terminal short term count in the S&P 500 in yet. Therefore we continue to forecast new highs, which are likely to happen on increased volatility however.
An overshooting of their equivalent medium term trend channels can also be observed in the Dow Industrials as well as in the Nasdaq 100. This action is usually observable at the very end of trends or right in the middle of trends, which form another (stronger) trend of their own (3rd elliott waves e.g.). It is highly unlikely that the latter is the case here. The primary reason being a 7-year old trend to the upside. It lead to strong overconfidence among equity investors today. This is represented by 5 elliott waves into the direction of this trend.
Nevertheless, it is also highly unlikely that the market crashes on Monday. We do see some more upside despite the state of the market. There is not a potentially terminal short term count in the S&P 500 in yet. Therefore we continue to forecast new highs, which are likely to happen on increased volatility however.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.