Last Of The Bearish Counts

Posted: under Predictions, Stocks.

The wave count since the middle of wave three has given analysts trouble – was wave 3 truly finished, what form might wave 4 be taking and so on. Now the legs of this rally have cast doubt on the predominant view that we have not yet finished wave 5 and so should expect modest new lows. There are several options, nicely summed up by Tim Knight in Possible Scenarios. Under scenario 2) there may be one more possibility for a new low in wave 5 and that is an ending diagonal starting from the Nov 4th Election Day high. This would explain the 3-wave nature of each of the major swings since Nov 4th. We would be at or near the end of wave 4 of such a diagonal with a sharp down move in wave 5 most likely starting today or tomorrow. There is a spiral alignment f8 with the said Nov 4th high to lend this some weight. However wave 4 has already exceeded 0.618 of wave 2 which would be 792 in the S&P500. All the other counts are varying degrees of bullish.

Short/Medium Term Spirals For S&P 500, March 19th, 2009 - Click To Enlarge

Short/Medium Term Spirals For S&P500, March 19th, 2009 – Click Chart To Enlarge

Comments (2) Mar 19 2009