Wednesday, November 19, 2014

Elliott Wave Stock Market Update - November 19

Today we got a bearish wave early in the morning from 2056 to 2040 that might end up being a bearish micro W1, so we'll see if the market finally decides to correct. If this is a micro bearish 5 count, I am looking at gap support as the initial target at 2015. And obviously, if prices go above 2056 then the bearish count gets invalidated and instead we'll see some sort of bullish triangle or even a nested bullish 1-2. But at these levels and after this long rally, I think the probabilities are slim.

Also, I wanted to follow up on the 2400+ target for the market if we are indeed witnessing the start of the final LT Int 5th wave. If the market gets to that level, chances are very high that a significant top will be in as any more significant upside will likely result if some sort of crash. The reason I say this is because the US market has never been more than 150% of GDP for long and while it could go higher, it would be the first time in history the market would be that overvalued. The following graph speaks for itself.

So 2015 might be the end of the bull market as we know it. History and the LT count supports this scenario, so should all major trends turn red next year (LT trend has been bullish for almost 3 years), it will be time to finally go net short in the US or at least wait for a while before getting back in.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit

Short Term Trend = Bullish
Medium Term Trend = Bullish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors.

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