To the Moon!

The discussion of the longer term options, in 600+ words, is omitted here but can be found at http://ewaveanalytics.com.  The final analysis usually not available on this blog has been provided however.  Also find the viewpoints of two other analysts and a consensus view while enjoying a 1-week free trial.  You can cancel your subscription at any time.

The wave higher beginning at (4) is growing in size where the wave higher following B is pulling away and larger than A.  Going back to the impulsive option since (4), although the size of C in relation to A is meaningful, keep in mind that a 2nd wave from A to B as the sideways zigzag+flat pattern illustrates above is not unusual, but not the most typical.

The double zigzag possibilities since (4) are not strong options because of the complexity that they command.  The double zigzag underway where 'w' is to (b) of [y] of B becomes weak from not strong due to its size requirements and the fact that a sideways pattern since (3) is really the only place it can fit; a double zigzag from (2) is no longer possible and 1975.65 would likely be taken out invalidating the ending diagonal option since (2).  The other double zigzag possibility is weak when considering the complexity and the fact that the subdivision within C is as large as that of 'b' of 'w'.  It also does not fit well into the smaller waves that follow B.

The pause that occurred early this week and ensuing rally works naturally into an impulsive structure.  Last time using the price action from B, it was found that the 3rd wave of an advance that began at B very likely terminated at [iii] or b of (w).  Using this we can say that the 4th wave terminated at [iv] or b of (x).  The double flat structure as illustrated above is more complex than a single flat to b of (x), but it makes [iv] of best size in relation to [ii].  It also has the advantage of giving a more simplified structure of the impulse rally following where no waves are required to be subdividing and there are likely not going to be any subdivided waves.  An impulse beginning at b of (x) on the other hand must have at least one subdividing wave and the corrective wave (y) is a bit large in relation to (ii).  But it does allow (i) to be a 3rd wave which is the most typical position because it is the largest wave.  If this is the correct wave count, there is likely a 5th wave underway since (ii) that is an extended wave.  Obviously if an impulse higher from [iv] is the true wave count, the somewhat preferred option, wave (iii) must remain longer than (v) so it does not become the shortest wave.

Final analysis:

The discussion above leads us to conclude that the market is winding down waves on a variety of scales.  An impulse wave higher from B is likely nearing completion where we are only waiting for [v] to continue winding down.  On Wednesday it was correctly stated, "there can even be a pop higher where an impulse from today's low has not yet shown its core.  But Regardless of what happens, it is likely that the 4th wave of an impulse higher from B is underway or complete where [iii] or the 6/2 high marked the termination of the 3rd wave.".  Trading-wise, it was mentioned that there is "a speculative short-and-hold play for some with a risk appetite.  But it is important to recognize that the short-term is uncertain".  The same remains true now, but there is less risk attached to the trade.  There will only be confirmation of a complete impulse wave since B when we see a corrective wave of larger size than any corrective wave higher since B.  This confirmation is then only a "signal" on the larger website that needs conformation to change the view on the front member's page.

Since it is unlikely at best that an impulse is underway since (4) and a double zigzag higher underway from (4) is not that likely, the impulse underway from B should terminate the rally beginning at (4) and this should happen sooner than later.

In the longer-term, weeks to months, the picture remains bearish.  The reason is that there are only mediocre to poor bullish wave counts that allows for higher prices after an impulse wave since B and a zigzag-family pattern since (4).

The wave higher since 2009 remains uncertain and works well as both an impulse or single zigzag wave.

very short-term (hours): bullish

short-term (hours to days): neutral to bearish

medium-term (weeks): bearish

long-term (months to a year): bearish

very long-term (years-decade): neutral

Finally, if anyone is in the Minneapolis, MN, USA area on Thursday, you can come hear me give a free guest lecture for an hour at the local TCTG (Twin Cities Trading Group) Group.  The last speaker for this group was Ralph Acampora.

Waiting

Last time the possibilities from late 2013 to the present were discussed in depth and these have not changed.  As stated last time, "the best options are ending diagonal wave counts beginning in 2013 at [4] or B where their 5th waves are underway, or an ending diagonal underway since (2) where its 3rd wave is underway.  An impulse wave higher since [4] and/or (2) are very weak options."  The sideways possibilities remain weak.  For a full explanation of where these views come from, please visit the last post here.

From wave (4), there can be a zigzag higher to ii of (a) or just an impulse to A then zigzag-family wave correcting to [w] when the area is taken in isolation.  Neither option is compelling for the reasons discussed last time.  But the possibility of this double zigzag higher has weakened due to the large size of the congestion area this week in relation to the early subwaves higher in [ii] of C; it is difficult to view wave [iii] incomplete.  The best view of the structure higher since B is an impulse underway where its 4th wave is underway or complete.  More on the details on this below.

The other double zigzag possibility where 'w' terminates at (b) of [y] (triangle divides two impulse waves in the 'w' zigzag) remains a weak option because of the complexity involved with the pattern.  The market tends towards simple moves.  Without over-thinking the situation, so far there are three waves higher since the wave (4) low.

Following [ii], the impulsive structure breaks down into two possibilities depending on how the action from ii of (iii) to v of (iii) is looked at.  If ii to v is one impulse, then the impulse higher from (ii) terminated at [iii] or the high reached Monday 6/2.  Because wave (ii) is so small relative to the action following the 6/2 high, and still assuming ii to v is one impulse, the impulse higher since (ii) very likely terminated at [iii] and the impulse higher since [ii] terminated at the 6/2 high.  If ii to iii is one impulse, the structure above in color makes the most sense.

No matter how ii to v is viewed, breaking (ii) to ii down into 2 or 3 sets of 1st and 2nd waves is a possibility.  But of the numerous new options this provides, there is only an added complexity and no added benefit; the impulse higher beginning at [ii] terminated at [iii] or the 6/2 high unless there is a major proportionality problem within the wave (again, the action following the 6/2 high is much larger than any corrective wave preceding it except for [ii]).  Also the size of the corrections within i are a bit small relative to ii of (v), iv of (v), etc.

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The Trend Continues

The market continued higher the last few days, but this does not change the wave count options expressed last time.  The best options are ending diagonal wave counts beginning in 2013 at [4] or B where their 5th waves are underway, or an ending diagonal underway since (2) where its 3rd wave is underway.  An impulse wave higher since [4] and/or (2) are very weak options.

Somewhat better is one of the sideways options starting at (1) or (3), but these are both adding a large new degree of complexity and size that does not work well in the the larger context.  For example a sideways wave underway since (3) is just expanding the size of a double zigzag higher since (2) which will lead to problems.  When the 'c' wave of the sideways correction comes, wedging has a good chance of being lost when considering that at least B will be reached.  This will invalidate all existing ending diagonal possibilities.  A large sideways wave since (1) or ending diagonal beginning at (2) with its 1st wave underway would become the best options, but the complexity of these patterns is certainly unusual.

A simpler sideways pattern since (1) is better with its 'b' nearly complete, but the size of 'b' is quite large in relation to 'a' and the whole pattern's pairing with either [D]-[E], B of (1), etc. also makes it questionable.  The 2nd and 4th waves of an impulse are typically of similar size and the corrections of the subwaves of impulses are usually of smaller size than the parent wave's corrective waves.  Also remember that an ending diagonal's 2nd and 4th waves are almost never sideways patterns so a sideways wave since (1) is probably a corrective wave within an impulse.

There are two good options following the wave (4) low; a single zigzag where an impulse wave higher needs to complete beginning at X or a double zigzag illustrated above with the colored labelings.  As discussed last time, the problem with the single zigzag is the structure of [a] of W to [w]; in order to find a corrective wave from [a] to X (clearly the most natural way of looking at the waves because of the large advance above (b) of [y]), a single zigzag must be forced from [a] to [w].  Remember a double zigzag higher from [w] to (b) for a 'b' wave of a flat is possible and this allows a triple zigzag from [a] to [w], a good way of describing that region, but this double zigzag is a poor option because of its subwave structure.

The double zigzag option higher in color resolves the subwave problem except [c] of W looks quite small in relation to [a].  But [b] of Y from a few weeks ago has good proportionality with [b] of W which makes this wave count a good one.  Relative to the other possibilities, in its entirety it is no worse.

A sideways correction still underway since (b) of [y] is possible, but the rise well above (b) gives it a low probability of occurring.

In the short-term, the core of the impulse wave higher since [b] is very likely on the 27th.  As it stands now, there is a nice shape to the wave with the core acting as a symmetrical point as it usually does.  Wave v of (iii) is a bit small in relation to i of (iii), but wave iv is much larger than any corrective within iii.  This attribute gives the strongest wave count as shown above in color but because of the better symmetry that it brings, it is the next best option.  In addition, the large subdivision we are seeing since (iv) (corrective waves as large as anything since [b]) is most typical of the terminating 5th waves of impulses, not 5th of 3rd waves of impulses.  If there is an impulse wave from ii to (iii), then there also must be an impulse wave from (ii) to iii of (v) or what will be v of (v) (wave i of (iii) really cannot be broken down into separate 1st and 2nd waves because of the small size of the waves within it).  An impulse to iii requires a very wide corrective wave from (iii) to ii which is large in relation to ii of (iii).  So that option makes little sense.  Better is an impulse to what will be v of (v), but as mentioned a 5th of 3rd wave with subdivision like this not typical.

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