An Elliott delight tonight. Everything is just right again. All the more, everything still is the same. This in a very good way — confirming the same bear spotted months ago still climbs a greased slope ... with increasing weakness only further revealed.
Thus, observations made over the past six months remain as valid as ever. Likewise consistent are the same demonstrations substantiating Elliott wave form: but a counter-trend rally in a bear market that began October 2007 is nearing its completion.
An extended fifth wave is forming. Relative strength (RSI) and momentum (MACD) continue fading. Yet, too, these measures continue on the positive side of their respective ranges, confirming, indeed, a C-wave is forming.
What used to be waves i-v of 5 now are waves 1-5 of i of 5. Duly note how most recent volume spike ("get your [capital starved] bank on") coincided with completion of the third wave (wave iii) of wave 5. A similar third-wave volume spike occurred at the completion of wave iii of 3 and wave iii of 1 (noted via green dots). Interesting.
Hard to say whether wave iv of 5 presently might be forming still (rather than completed, as suggested above). It's possible wave iv RSI and MACD might first degrade below respective readings registered during formation of wave ii of 5 (as is typical), leaving wave v of 5 [of C of (B)] yet to follow. Maybe not, though.
Yesterday's expansion of the NYSE New 52-week High-Low differential to a new high, post-March '09 bottom (not matched on NASDAQ), suggests wave 5 of C of (B) might be some days away from completing. Then again, maybe it is entirely appropriate an NYSE new-high peak coincide with the end of a major counter-trend rally. Might not growing euphoria — widening [ETF-driven] NYSE-listed share love — signal top?
Either way, given what has passed these last 2 to 10+ years, that major indexes are likely to challenge lowest levels reached over the interim, minimally, yet again appears a probability whose moment of truth is drawing near.
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