Elliott Wave 5.0 "Reboot"

Friday, January 15, 2016

E-Mini SP500 2009-2016 Review

This is the action in the March contract. This chart saw another bearish low this morning and I am sure many will say it has much further to fall. They may be right, but we are not near to any standard definition of a bear market of a 20% decline. It also depends if you are measuring it using a gross number or a net number. 

At this time it all looks ominous indeed, but I can't ignore the patterns the SP500 has made to get here.  Besides, any 4th wave potential is designed to fool us all, especially all those SC and GSC degree wave counters that desperately need a 5 wave crash in Primary degree. Inside a potential big triangle in Cycle degree, we will never get 5 waves down in Primary degree.  The best we should get are 5 wave runs in Minor degree. 

So far my Minor degree diagonal pattern is so close to being thrashed that a bigger triangle, kicks in. 
We have to see if the new bottom this morning will hold, but that may be a figment of my imagination as well. In fact, all wave counts are a figment of our imaginations, as we have no real way of confirming any wave count. 

I may not know exactly where we are at any one time, but I sure have a good understanding of what will not fit. Trying to ram a wave count is a futile effort, but many times it must be done to eliminate a wave count. 

Now we are what looks like a tripple bottom base, but this base may still give us a false downside breakout. 

The VIX has blasted to newer highs, but it has so many open gaps below that it also looks like Swiss cheese. 

On Fridays the markets may get a bullish push as bargain hunters step in. Of course only dare devils and wave counters try to catch a falling knife.