Yesterday I already mentioned that the NYSE had completed 5-waves down for a c-wave, and that it most likely did not complete 5 waves, but 3 waves instead because of the 1.618x extension that price-low hit yesterday, which is uncommon for a 5th wave, and that we could -at the very least- expect a rebound to 11,000 +/- 20. Wham, bam, thank you mam (that is Intelligent Investing! 😉 ) for that accurate information. Well, a rebound we got. Such a strong rebound in fact that the INDU made a new ATH and price moved strongly out of the ascending trend channel I showed yesterday that it had been in for the past 8 trading days. The WLSH5000 did the same. The SPX is a bit lacking, but should move out soon as well.
(click to enlarge)
Given that the INDU made a new ATH today it simple means today CANNOT have been a 2nd wave, since 2nd waves CAN NEVER go beyond the start of a first wave. Given also the sloppy nature of the price action over the past 8 days, it is very hard to not count this in any other way than a correction that is over. The only alternative is that today was some sort of big b-wave, and the next wave down will be a c-wave that either terminates at or below yesterday’s low. Given the way the technicals are set up etc I see that as less likely however. Thus, we’ll simply look up. Here are some longer term targets based on standard/text book Fib extensions:
minor 1: 1905 to 2011 (say 105 points)>
minor 2: down to 1978
minor 3: 1978 + 1.382x 105 or to 1978 + 1.618x 105 = 2123 to 2147
minor 5: (and there with Primary III) will go to 1978 + 1.764x 105 to 1978 + 2.0×105 = 2163 to 2288.
Note that the 1.618x extension of the Primary I wave (the 2009 low of SPX 666 to the 2011 high SPX 1370) measured from the Primary II wave low (2011 low of SPX 1074) is at 2214: 1074 + 1.618X (1370-666), which is right in the middle of the minor 5 target area of 2161-2288!
With that, dear reader, I’ll leave you for now and I hope you value the accuracy of Intelligent Investing’s counts, technical insights, and analyses, and that you want to join us as well. We don’t only track the markets, but many other stocks, and have been forecasting and nailing their recent highs (for example FB, TWTR, GPRO, GTAT) and recent lows (TSLA, SBUX, GTAT) just to name a few.
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