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Wave_3

Wave 3 UpdateHere is out map of Primary wave 2 to this point. It is unclear if Minor 5 and Primary wave 2 are completed. Now that Primary wave 2 retraced all of Primary wave 1's movement and then some, instead of limiting historical datasets to a ratioed range, I am comparing all similar micro waves where wave 2 moved more than wave 1. Elliott wave theory says wave 2 cannot move more than wave 1, my modified theory permits this when it occurs. Wave 1's movement / Wave 2's movement = 0.9957. I compared all data in which this ratio is less than 1 (Wave 2 was larger than wave 1) and the numbers look a little more realistic moving forward. According to the data, Primary wave 3 should bottom above 3754 and less than 4036. The duration will likely last 608-740 trading hours. I still have other models with heavy agreement at a duration around 690-699 hours. Most models have the bottom between 3750-3799, which falls inline with the historical ratioed data. I will use the target of 3775 (drop 834.23 points from Friday's high) in 690 hours for estimating the Intermediate wave endpoints. Preliminary bottom for Intermediate 1 is below 4350 before December 25. Intermediate wave 2 up toward 4500 by January 10. Intermediate wave 3 will be a significant drop over time, current look is 3900 by end of February. Intermediate wave 4 bounces up toward 4100 by mid-March. Current Primary wave 3 and Intermediate wave 5 bottom is around 3775 by early May. Again this is all under the assumption Primary wave 2 is where we are, has completed, or will complete shortly after the open tomorrow. Primary wave 2 cannot realistically sustain too much more upside otherwise my wave placement is well off. More updates to follow.
SP:SPXShort
by StockSignaler
6
Safe to forecast next drop yet?Hopefully its time to take another crack at forecasting Primary wave 3 down. Wave 2 started strong and managed to retrace 98% of Primary wave 1 down. I began to have doubts we were in the right place. Still would like a drop below my green trendline here: We finally broke well below the yellow and have created a lower low and lower high. These are early indications we may be in Intermediate wave 1 down inside of the Primary wave 3. A break above 4599 and then 4607 likely puts the market in a different place in wave theory time. Now that Primary wave 2 is longer from a duration standpoint and larger from a movement standpoint, there are some changes to the original Primary wave 3 forecasts. I originally expected Primary wave 3 to bottom in May, but my initial projections a few weeks back placed the bottom in March/April at the latest. The movement extension percentages did not change, nor did their values as that data was predicated on Primary wave 1’s movement. Current forecast is a duration of 900-922 trading hours which would place the bottom around mid- to late-May 2024. The bottom has now risen to a area between 3600-3660. The movement and duration are based on similar wave 1/wave 2 relationships from historical wave theory data. Primary wave 1 was 461 hours long while wave 2 was 162 (as of the high on December 1). This forms a ratio of 2.8457 (461/162). Primary wave 1 moved 503.29 points down while wave 2 gained 495.608 of that back. Ratio is 1.0155 (503.29/495.608). I searched for similar datasets in which the 1:2 duration value was between 2.4 and 3.1; while the movement was between 0.95-1.08. For additional more refined data I shrunk these values to 2.6-2.9 on the duration which provide a tighter grouping of possibilities. These historical wave pointed to an extra 300 hours of duration and bottom around 3550. While I will keep these in mind, I think my historical bottom targets have been too long and too low. I will keep the target around 911 hours near 3630. I have taken the median models to forecast what the movement should look like to get to a bottom of 3630 over 911 trading hours. Intermediate wave 1 appears more realistic as do wave 3. This is more of a perfect world wave placement on the way down but it is based on normal historical movement for Intermediate waves inside of a wave 3. Right now wave 1 could end late this month/early in January around 4220. Wave 2 bounces up near 4475 around mid-January 2024. Intermediate wave 3 should be the big drop we have been looking for and likely drawn out over 2 months. That current bottom aligns beneath 3800. Wave 4 looks to move up toward 4000 by early April and the final bottom is end of May/early June around 3630. At this 3630 bottom there is likely 6 months or less until the final bear market bottom. Things should blast off beginning late in 2024. Here is the current possible path moving forward: I continue to lean on China taking Taiwan as the major driver of downward movement in the first half of 2024 but we shall see. COVID shutdown scares could rattle some industries but likely wont do enough damage this time around as most people desensitized to lockdowns and understand how quickly industries snapped back from COVID declines.
SP:SPXShort
by StockSignaler
December Selloff No Matter This Week’s MovementWith a few more days of data from the last analysis it is time to lay out the next possible paths. The index and markets are very much so overbought. A downturn is coming. No matter what happens this week, December will likely contain the next selloff. Does it continue tomorrow, or can the market find another new high above 4521 first? I will lay these out along with the reasoning and see which plays out. The continuing theory and first explored here is that Primary wave 2 ended with the top on November 15. If this is true we are somewhere in the early stages of Primary wave 3 which will ultimately move down as covered in the last analysis: Although Thursday continued to move down, Friday nearly lead to a new high which would have completely negated the theory Primary wave 2 was over. That near new high could have been the double top of resistance or a prelude for a new high later. I am trying to determine if the move down on midday Thursday was a micro wave 1 and the preceding move up was a micro wave 2, then at what wave degree was it? Primary wave 3 will be comprised of 5 Intermediate waves which I mark with pink alphanumeric values. The first of the Intermediate waves will contain 5 Minor waves which I mark yellow. The first Minor wave will contain 5 Minute waves which I mark in green. The wave 1 in question moved down 33.34 points after which wave 2 moved up 32.29 points. This was a retracement of 96.8506%. While this movement is common in double-top formations I went to the data to see what could happen next. I sorted my historical datasets to determine when similar retracements in a wave 2 occur in Minute wave series. There were only five occasions thus far in which a retracement greater than 96% occurred. If we just ended Minute wave 3, the likely next stop is a low between 4408 and 4457 over the next 11-49 hours. I then determined how much of the larger wave wave 1 comprises and wave 2 comprise to attempt an early estimate for the placement of Minute wave 5 and Minor wave 1’s endpoint. This is the larger white box with the green numeral 5 in it. The estimate is that Minor wave 1 would last between 40-100 hours with a bottom between 4370-4402. This is the theory plotted on the main chart as it is the leading theory, however the movement tomorrow will likely confirm or deny this reality. I further researched the 96% retracement but applied it to one macro level higher. Instead of assuming we were inside of Minor wave 1, I looked at the data if in Intermediate wave 1. I am already thinking we are moving too fast for this scenario, however, using the same data from before and searching Minor wave series there were 10 results. Minor wave 3 could end in the top yellow box and last 9-22 hours ending between 4463-4473. Similar to before, the entire Intermediate wave 1 could end between this Friday and next Tuesday between 4430-4463. This path will greatly shorten the overall length of Primary wave 3 if it plays out. For the third theory, I have moved the end points of Minor wave 3 and 4 around to reflect the ongoing effort of Minor wave 5. On a 30 minute chart, I get a wave 3 signal at 1100 on November 14. While this was originally believed to be a wave 3 signal and where Minor wave 3 ended, it could be the end of Minute wave 3 inside of Minor wave 3 instead. This could place the end of Minor wave 3 at the current high of 4521.17. Minor wave 4 would have followed at the low of 4487 at 1130 on November 16. Based on the models, most of the duration models are already busted last potential viable window is at wave 5 lasting 14-16 hours. The 16th hours is late Monday afternoon. Most models agree on a top between 4545-4555. As mentioned in a prior analysis, the highest ever retracement for this particular wave set was 89.08% which is at 4552.11 in the current case. Just because this is the maximum does not mean it cannot be broken. Before it was the maximum retracement something lower also held that title. I can also apply my new derivative modelling in solving this Minor wave 3 theory for a separate target area. The broadest area for the derivative model places the top between 4516.74-4538.76 between 2-19 hours. The next more specific target in this model is the yellow box. The most specific box is too small to display, however its values are important to note. The placed the length at 8-10 trading hours between 4520.65-4523.12. The derivative model sets a far lower target than the other modelling system. The most specific target is where the current top in this possible Minor wave 5 sits. It is possible the top occurred as this model projected while falling to move 100% of Minor wave 3’s movement. It is possible for a wave 5 to come close but fail to break above Minor wave 3. This circumstance would also mean the market moves down immediately, however, it cannot be confirmed this occurred until the waves in Primary wave 3 Intermediate 1 finalize to see if they have too many waves or not. Although the derivative model is still being tested, it has been highly accurate. I will move the endpoint for Minor wave 5 and Primary wave 2 below 4540 understanding the top could already be in. Going with the leading theory likely makes Primary wave 3 much longer than the last analysis forecasted which could put it more in line with my initial assessment of a bottom around May-June 2024. Theory two seriously shrinks the size, both duration and drop, to much less than initially forecasted. I currently see this as the least likely scenario. The third scenario would likely be confirmed on Monday or Tuesday this week. A holiday shortened week typically comes with larger price movement on low volume. This could see the new high achieved, however, the next key resistance is 4607 and would be tested quickly and appears to look less likely after this analysis. A new high will further move the market into overbought territory continuing the absolute certainty of a massive drop to follow.
SP:SPXShort
by StockSignaler
8
Monday Holds The KeyLet’s recap what was expected from . Based on specific historical wave data for waves ending in 2BC2, Intermediate 2 had quartile retracements of 33.44% (1st quartile), 60.60% (2nd quartile/Median), or 77.87% (3rd quartile). These levels are depicted on PATH TWO in the chart above. Wave 1 ended 2 days after the analysis was posted and the adjusted potential retracements respectively aligned with 4048.89, 3950.94 and 3888.67. A lower trendline which has provided support also aligned with a potential floor for the activity ranging from 3920-3960. Intermediate wave 2 was expected to last 8-12 trading days. The lowest point achieved thus far is 4049.35 from the final hour of trading on April 26. This could be the end point of Intermediate wave 2 as it was nearly consistent with the projected first quartile drop or it was the end of Minor wave A inside of Intermediate wave 2. The close on Friday has presented an interesting crossroads and an argument can be made for the short-term bear case and longer-term bull case. PATH ONE above will displays what should happen next if Intermediate wave 2 has ended. PATH TWO displays the likely end of Minor wave B inside of Intermediate wave 2 and the final leg down to conclude Minor wave C and simultaneously Intermediate wave 2. The Case For PATH ONE: Here is the likely internal wave for Intermediate wave 2: Two wave 3 indicators were present on the 30 minute chart at Minute wave 3 (green) in Minor wave A (yellow) on April 20 as well as Minuette wave 3 (orange) inside of Minute wave 3 inside of Minor wave C on April 25. I like to see the “wave 3 of 3 of 3” indicator when confirming locations and April 25 displayed exactly that. Wave 3 Finder: The wave 3 indicator normally identifies all wave 3s along with the end of corrective waves (2, 4, & B). The daily chart did not provide any wave signals for a wave 3 or the correctives, however, the 2 hour and hourly charts identified the end of Intermediate wave 2. The hourly also found the wave 3s identified in the 30 minute snapshot above. This is a strong case for Intermediate wave 2 being complete. The Case For PATH TWO: Here is the likely internal waves for Minor waves A & B: The wave 3 indicators still remain in the same places although the April 20th one aligns with the end of a wave 1 which is not common. The other still highlights “a wave 3 of 3 of 3” Intermediate wave 2 would have lasted 6 days IF PATH ONE IS THE CHOSEN COURSE which is about 24% of the length of Intermediate wave 1 which was 25 trading days. Wave 2s inside of 2BC waves tend to be at least 31% the length of wave 1, however, 22% of the time they have been less. This 22% occurred in macro waves (which this is not) and consistently stayed between 18-19% of wave 1. In fact, the median wave 2 length is half that of wave 1 and the third quartile is the exact same size as wave 1 (100% length). I do not expect wave 2 to last 25 days, however, something closer to 12 always seemed possible. Although statistics and historical references are not perfect, this could indicate Intermediate wave 2 is not done yet. While walking through this analysis I can believe either one is viable, although PATH ONE may be the winner if one must be chosen at this point. WHAT SHOULD HAPPEN NEXT: PATH ONE: Based on waves ending in 2BC3, the quartile movement extensions are 110.75%, 302.37%, and 371.04%. This means the median movement could see a top for Intermediate wave 3 which is 302.37% larger than the total movement from Intermediate wave 1 which was 360.62. This highly unlikely (I feel very comfortable calling this impossible) top would be at 4899.267 which would be a new all-time high for the stock market. The models lack a majority agreement on length in terms of trading days long as they fluctuate at 17, 21, 24, and then 72 days. These data points are too wild, next data is based on waves ending in BC3. The quartile movement extensions align with 4323.64, 4691.69, and 4752.97. The trading days to reach these levels are all at or longer than Intermediate wave 1 (meaning 25 trading days or more). There is a strong resistance trendline that tops out at 4392 if Wave 3 was 31 days long. This would mean wave 3 moves very slow for only 150-200 points. Wave 3s typically have a punch and multiple large periods of upward momentum as seen the past two trading days. The past two trading days are in fact looking more like a wave B instead of the beginning of a wave 3. This schedule would also place wave 3 topping in early June and the final market top in early July. Last set of data is based on the much broader set of waves ending in C3. Most models agree on 18 or 25 days long while the first quartile of all days is at least 25 days in length. Even if the top is set to occur within 16 trading days from the close on Friday. This would be a slow gain of 180-230 points over 3.5 weeks with the Fed and a CPI reading (May 10) in the middle of it which is likely market moving events capable of gains of 50-100 points in a single day. PATH TWO: Based on waves ending in C2C, the quartile movement extensions (light blue levels on the left side of the right chart) are 100.27%, 113.095%, and 132.02%. This would mean the first quartile movement of Minor wave C inside of Intermediate wave 2 would be 100.27% of Minor wave A’s movement. Basically, Minor wave C could end just below the Minor wave A bottom of 4049.35. The models strongly agree Minor wave C could last 3-6 days (day 1 would be this Monday and day 3 would be when the Fed speaks on Wednesday). Based on waves ending in 2C, the movement extensions (yellow levels) are 110.45%, 133.13%, and 154.44% and strongest model agreement is at 3 days in length. The bottom of Intermediate wave 2 would likely be around 4000 at the lowest instead of 3950 as originally projected. This would push the end of Intermediate 3 into early- to mid-June and the final market top to mid-July (which aligns better to most probable debt ceiling crisis as the catalyst for the projected major market downturn greater than 1800 points) FINAL ANALYSIS: There are zero powerful economic reports prior to the Fed that would drop the market 100-200 points from Friday’s close before the Fed speaks on Wednesday. Short of a geopolitical event over the weekend (Iran and the world’s oil supply / China / North Korean shenanigans / Russia-Ukraine war), PATH ONE is the most likely. PATH TWO appears the most likely ONLY because the anticipated wave 3 is far ahead of where it should be per PATH ONE analysis if the top is only 150-200 points away from Friday’s close and spread out over 6 trading weeks. The levels and length for Intermediate wave 3 does not change no matter what wave 2 did. However, a bottom for Intermediate wave 2 around 4000 which occurs within the next 3 trading days would give Intermediate wave 3 nearly 350-400 points to gain over 5-6 trading weeks which is much more reasonable
SP:SPXLong
by StockSignaler
Week starts down and up after elections?If we are in Cycle B, and if it began on October 13, then we are likely in Intermediate wave 2 right now. Intermediate wave 1 would have lasted 13 days and gained 420.21. Right now I have the market in Cycle wave B, Primary A, Intermediate 2, Minor C, Minute 3. A down day on Monday would likely confirm this position. Also, if we are in wave 3 there would likely be a gap down at the open. I have projected the end of Intermediate 2 based on the Intermediate wave 1 data in combination with historical relationships. I have also projected the end of Intermediate 2 Minor C based on Minor waves A and B. Levels forecasting the bottom of intermediate 2 are on the right while the left levels are forecasts for Minor wave C Right now the bottom may occur either late on Tuesday or early Wednesday (the election is the likely catalyst and bottom). The bottom will likely occur above 3625 but below 3700. I will re-analyze if we do not drop all the way or there is any other deviation outside of reason.
SP:SPX
by StockSignaler
2