Elliott Wave, Hurst Cycles and Fibonacci Analysis of the Dow Jones Industrial Average (DJIA) by Sid from ElliottWavePredictions.com

Elliott Wave, Hurst Cycles and Fibonacci Analysis of the Dow Jones Industrial Average (DJIA) by Sid from ElliottWavePredictions.com. Click on each chart to enlarge.

The Dow Jones Industrial Average is down only 2.33% since the Friday September 19 all-time high, but Hurst cycle analysis is already suggesting that a major top is “in”. As I described in my last free post about the DJIA, I base all U.S. stock market cyclic conclusions on Sentient Trader Hurst Cycle analysis starting at the Y2K high, as I believe that to be the last significant turning point in the underlying “character” and “pace” of the U.S. stock market.

As of the close today (9/25/2014), an up-to-date Hurst analysis indicates that the 4.5-yr cycle crested in June, and the 18-month cycle crested in May. The 40-week cycle is due to crest on about October 23, but the 20-week cycle, 80-day, and 40-day cycles all crested within the last few days. So, of the six largest cycles that Sentient Trader software can deduce based on a 14-year price history (2000-2014), five are now pressuring price to the downside. This condition appears to be overwhelming the only remaining larger cycle yet to crest, the 40-week. We therefore are very likely to have seen a major top in the Dow Jones Industrial Average on September 19, in my opinion.

From an Elliott Wave standpoint, all of the required subdivisions of an ending contracting diagonal completed on September 19, which, in textbook fashion, concluded with a very slight throw-over of the upper diagonal trendline.

As for Fibonacci price targets, there were a number of significant, large degree targets from 16,690 to 17,455, as shown on the daily chart below. The September 19 top tick of 17,350.64 occurred inside that Fibonacci target cluster.

DJIA weekly 9-25-14

DJIA daily 9-25-14

DJIA 240m 9-25-14

DJIA daily Hurst 9-25-14

The last chart above is a screenshot of the Hurst Cycle Analysis, as performed by Sentient Trader software, after the close of the market today, September 25, 2014.

One last note: Just because the Dow Jones Industrial Average appears to have finished a terminal upside pattern does not mean that every U.S. and European stock index has put in their respective tops. And many of the Asian indices do not appear to have put in their highs for the year yet. For the complete picture, please join me for my weekend “Counts” webinar, where I show all of my Elliott wave counts and associated Fibonacci price targets for many of the world’ major stock markets, commodities, currencies, and bonds. Hurst cycle analysis is always considered.