Time To Drop After Tuesday's Nice Pop?

28 giu 2023

Assuming we are early into the long trip downward would put us somewhere in the early stages of Cycle wave C down, Primary wave 1 down, Intermediate wave 2 up. This would have made Intermediate wave 1 down 5 trading days long with a 120.39 point drop. Based on waves ending in C12, Intermediate wave 2 will last 1 day. There are zero other possible lengths. The quartile movements (blue levels on left) are 27.99%, 50.12%, and 56.51%. Based on waves ending in 12, strongest model agreement for length remains at 1 trading day and second strongest by a lot is 2 trading days. Quartile retracement levels (yellow lines) are at 27.99%, 42.03%, and 66.20%.

Tuesday was the first official trading day of Intermediate wave 2. This is quite possibly the only trading day of wave 2. IF wave 2 achieves a new high tomorrow, Thursday would likely not see a new high for a very long time until we drop well below 4328 again. IF a new high is achieved tomorrow it may remain at or under 4400. IF we break above 4400 tomorrow, we may still be BACK in Cycle wave B as was identified in my most recent Devil’s Advocate Analysis. IF back in, well still in B, the market is either in the final Intermediate wave 4 Minor wave B up or the early stages of Intermediate wave 5 which would likely lead to a final market top within 2 weeks.

If no new high is achieved and the market falls (likely based on all the Bank of England/Central Bank/Federal Reserve panels in Portugal) the market is in the early stages of Intermediate wave 3 down. This scenario would have seen Intermediate wave 2 last a single day and retrace 46.8% of Intermediate wave 1’s movement. Based on waves ending in C13, the quartile movement extensions of wave 1’s movement (blue levels farther on right) are 135.64%, 140.60%, and 165.83%. Most model agree on a length of 4-6 days, with secondary agreement at 7, 8, or 10 trading days long. Based on waves ending in 13, the quartile movement extensions (yellow) are 137.30%, 162.265%, and 198.02%. Models have strongest agreement on length at 5 days long, second is 1 or 4 days, third most agreement is 3 days, fourth is 7 days, fifth is 6 days, sixth is 2 or 10 days. Based on these models, the initial forecast is a possible market low late next week after the American holiday possibly below 4279 and probably not below 4240. This would equate to a drop of around 120 points in about 6 trading days. This is pretty much the same thing accomplished by Intermediate wave 1.

Let us see how this plays out beginning with movement tomorrow.

29 giu 2023

Nota

UPDATE: The movement today seemed to play out a corrective wave much better and an ABC wave structure is clear on smaller timeframe charts with wave 3 indicators in the correct locations. This now makes Intermediate wave 2—2 days long, gain of 62.27, and a 51.72 retracement of Intermediate wave 1’s movement. The movement extension levels for Intermediate wave 3 have not changed and the lines on the chart above remain accurate. The extra day for wave 2 slightly changed the target length of Intermediate wave 3. Based on waves ending in C13, most model agreement is on 7 days long, second longest at 5 days. Based on waves ending in 13, strongest agreement remains on 5 days and second model agreement is much weaker. Second most agreement is on 2 or 3 days, third is 8 days, fourth is 4 or 10 days, fifth is 6-7 days. I would still estimate the bottom by the end of late next week or Monday-Tuesday of the following week under the current assumption Intermediate wave 3 began today and the official day one is tomorrow. Two days would be accrued this week and 3.5 more days are next week with the holiday shortened week. If the bottom is next Friday, could be around 4255. If the bottom is the following Monday it could be around 4245.