Elliott Wave Analysis of the S&P-500 (SPX) by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.
After plunging 12.48% from May 20 through August 24, the S&P-500 it has now recovered over 84% of that drop. Will the rally continue? There are several technical signs the market may be ready to roll over again:
- As you can see on the 240-minute chart, it is possible to count five blue waves down from the truncated end of a contracting ending diagonal on July 20 through August 25, with the 5th wave in blue being very slightly truncated, ending within 7/100 of an S&P point of the bottom of blue wave 3 (on Aug 24).
- The subsequent upward movement has moved so far in 3 waves, labeled on the chart as blue A, B, and C.
- Wave C blue has reached just slightly beyond 1.618 times the length of blue A (2076.43).
- Within blue C, pink wave 5 has stretched just beyond .618 times the net traveled by pink waves 1 through 3 (2083.7).
- Within pink wave 5, green wave 5 has reached .382 times the net traveled by waves 1 through 3 green.
- The MACD histogram on a 240-minute chart is showing a large divergence from the MACD line starting Monday the 26th.
- The Fibonacci relationships have created a target cluster for the end of blue wave A from 2076.43 and 2092.84. The SPX has stretched to the upper edge of that zone today, with an intraday high so far of 2093.29.
- Hurst cycle analysis is expecting a nested 80-day and 20-week cycle crest centered in the early days November, but starting tomorrow, price will reside within the topping date window for both cycles.
- Finally, Hurst cycle analysis expects that a nested 80-day and 20-week cycle trough is due in early December.
For all those reasons, the market rally that started August 24 appears to be complete, or very nearly so.
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P.S. – The following material was added to this post one day later, on Oct 31:
Almost immediately after I made the original post above (around noon Friday, October 30), the market, on an intraday basis, started moving to the downside quite aggressively. About that time mid-day, on a very short term chart of the ES contract, I noticed realtime that five clear waves to the downside (with proper internal Fibonacci relationships and wave subdivisons) were evident from the pre-market (Friday) high. So, after the market closed on Friday, and after a fresh Sentient Trader Hurst cycle analysis, the SPX cash index chart now looks like this:
This prompted several emails from non-subscribers ( yet . . (-: ) with questions about whether or not I had correctly predicted the big up-move in stocks from the August lows. So I went back to actual screenshots sent to EWP ScreenShots (and EWP “Counts” Webinar) subscribers in late August. Here are three of them: