A nothing day yesterday as the market chopped around, which is a bull flag basically. I'm looking for a breakout today and a run up to the 1/6 prior high area, which is where we should see the top for this first (5 wave) move up. I'm not sure about how much we pullback next week but it should NOT be the start of a next big move down.
Maybe it's 100 points, but again, it's not expected to be a huge drop... not yet. "Time" must pass first, meaning the market needs to burn through the rest of this month before it can rollover hard, and while it's certainly possible that it chops sideways for 2-3 weeks in a tight range I give that lower odds.
The daily MACD and RSI are turning up and should help the market make that blow off top a reality. At least that's the favored odds, but of course just because odds are leaning toward it happening doesn't mean it has too. Odds of it falling off a cliff prior to February though are super low, which only leave two choices... blow off top or choppy sideways crap that goes nowhere. Back to the short term, today we should see a wave 5 up from the 1/13 low to complete that pattern.
Yesterdays move was the wave 4 and this wave 5 is all that is left, and technicals suggest it happens today. I guess it could drag into next week but not likely as the inauguration is Monday and I don't see much happening until later next week as traders try to figure out what's next after it's over with.
Also, the market will be closed on Monday for Martin Luther King day, and it just happens to be inauguration day too. So everything suggests we'll complete the 5th wave today for what is likely a bigger wave 1, and that leaves wave 2 to chop around most of next week. Then, "if" I'm right about the blow off top, we see the wave 3, 4, and 5 take the market up to 6500+ into the first week of February to end the bull market.
Have a blessed day.
