A couple theories from Richard Russell…….
I have only two theories; first, the market will decline in a jagged
see-saw pattern, a pattern that creates no fear. The market drops ten
percent and analysts declare that this is the long awaited and long
expected ten percent correction.
But the general market continues to
decline, and investors remain in the market waiting for the inevitable
rally that will conclude the correction. No rally comes, and stocks
continue to decline, suddenly there is a realization that this is no
correction but a bear market, and down goes the bear, taking billion of
shares with him.
The other scenario that I envision is
one day, with no previous warning, the market drops and a huge gap, over
a thousand points in the Dow opens. The authorities close the exchange
for three days and when the market opens, it gaps down again. When the
market finally opens again, thousands of stocks open well below their
previous closes and a bear market is on.
THIS IS ALL SEEN ON A DAILY CHART
———————————
May 21st, 2015 high of 2134.28 to July 8th low of 2044.66 is LARGE Wave A down, which was 89.62 points in total.
It had 3 MEDIUM Waves inside it with it’s A down ending at 2072.14 on 6/9, then MEDIUM B up to 2129.87 on 6/22, and MEDIUM C down to end LARGE A down on 7/8 at 2044.66
Then we had LARGE Wave B up from 7/8 low to a 7/20 high of 2132.82, which was a 95.8% retracement back up or 88.16 points.
From the 7/20 high we started the LARGE Wave C down, and so far it’s breaking down into many smaller waves. We are currently still in the first MEDIUM Wave A down inside LARGE Wave C down.
Inside MEDIUM Wave A down we appear to have completed SMALL Wave A down from 2132.82 to the 2063.52 low on 7/27, then SMALL Wave B up from there into the 7/31 high of 2114.24, and now we are in SMALL Wave C down currently (from 7/31).
This SMALL Wave C appears to have broken down into 5 smaller waves. Wave 1 down went from 2114.24 on 7/31 to 2067.91 on 8/7. It had an ABC wave patten inside it as follows: Tiny A from 2114.24 to 2088.60, Tiny B back up to 2112.66, and then Tiny C down to 2067.91… ending Wave 1 down inside SMALL Wave C down.
Next we have the move up on Monday the 10th to make the Wave 2 up inside SMALL Wave C down, which was from 2067.91 to 2105.35, and thus putting us currently in Wave 3 down inside SMALL Wave C down today.
Since most all C waves and 3 waves are long and powerful they tend to divide into 5 wave patterns. That suggests yesterday’s high of 2105.35 to the suggested low this coming Thursday or Friday should have 5 wave inside it. I think we have done 1 down, 2 up (at the open today) and currently are in 3 down now.
If correct this leaves 4 up Wednesday and 5 down Thursday yet to come. The length of this wave down should be a ratio of it’s A wave down. Since SMALL Wave A down for this wave was from the 7/20 high of 2132.82 to the 2063.52 low that’s a total of 69.3 points.
Therefore, if SMALL Wave C down equals SMALL Wave A down in length then from the 2114.24 start of SMALL Wave C down we can subtract 69.3 points to come up with a downside target of 2044.94 as the coming low.
If SMALL Wave C equals 1.618% of SMALL Wave A down then we have 112.13 points down from 2114.24, or 2002.11 for the coming low this Thursday or Friday.
After this low is in we’ll complete SMALL Wave C down, as well as MEDIUM Wave A down, inside LARGE Wave C down. This means next week (the week of option expiration from 8/17-8/21 we should see MEDIUM Wave B up happen.
If MEDIUM Wave A down completes this week at the 2044.94 low then we have 89.34 points for it in total. Since MEDIUM Wave B up should be some Fibonacci percentage of the A wave we have the following possibilities…
MEDIUM Wave B up if 2044.94 low…
If 38.2% of MEDIUM Wave A down, then we should see 34.13 points up from the low of 2044.94, or 2079.07
If 50% of MEDIUM Wave A down, then we should see 44.67 points up to 2089.61
If 61.8% of MEDIUM Wave A down, then we should see 55.21 points up to 2100.15
MEDIUM Wave B up if 2002.11 low…
If 38.2% of MEDIUM Wave A down, then we should see 42.83 points up from the low of 2002.11, or 2044.94
If 50% of MEDIUM Wave A down, then we should see 56.06 points up to 2058.17
If 61.8% of MEDIUM Wave A down, then we should see 69.29 points up to 2071.40
FINALLY…
If all this happens then what should start the week of August 24th is MEDIUM Wave C down inside LARGE Wave C down, and that’s a whole new story my friends! Needless to say when you get many C waves stacked on top of each other you get a “FLASH CRASH”… caused by what you ask? Watch the movie Lucy, and look closely around 55 minutes into it. The rewatch The Matrix with the interview Neo had with an agent. False Flags are told to the insiders in advance.
SBUX finally got whacked along with NKE, the two retail stocks that were probably holding up RTH while XRT diverged badly. Hotel stocks have been getting whacked as well…..HOT,WYN, MAR, HLT etc.
It looks like the celebrated Leo,Tebow, will be making the Eagles. All of this after spending a year out of football, helping launch the SEC network last year on his birthday.
We are in some serious South Sea Bubble cycle territory now. 295 years from the SS Bubble top. I don’t have the exact dates but the high occurred in August 1720, with denouement occurring in September. There was a great conjuction of planets on September 9,10. That could have launched the waterfall portion of denouement. Only the operators/ gnomes of Zurich have the exact dates.
We are also on the 25 year cycle to 1990 which saw a high in late July with a low in September. They might have delayed the 25 year cycle by three years to better align it with the 1990 pattern although it will probably take on a fiercer form. A lot of parallels to 1990 right now, a real estate bubble high/bursting….Japanese buying up US real estate/ trophy properties in New York…..Now a real estate bubble with the Chinese buying up US real estate/ trophy properties in New York…..real estate developers building luxury apartment buildings everywhere now and commanding “luxury level rents” even though many of the properties remain minimally occupied.
Transports peaked out the previous fall in 1989 while the market made an overall peak in July 1990. Transports/ utilities peaking in early 2015.
if the wheels do come off, how slow and inept will the reaction be?
A couple theories from Richard Russell…….
I have only two theories; first, the market will decline in a jagged
see-saw pattern, a pattern that creates no fear. The market drops ten
percent and analysts declare that this is the long awaited and long
expected ten percent correction.
But the general market continues to
decline, and investors remain in the market waiting for the inevitable
rally that will conclude the correction. No rally comes, and stocks
continue to decline, suddenly there is a realization that this is no
correction but a bear market, and down goes the bear, taking billion of
shares with him.
The other scenario that I envision is
one day, with no previous warning, the market drops and a huge gap, over
a thousand points in the Dow opens. The authorities close the exchange
for three days and when the market opens, it gaps down again. When the
market finally opens again, thousands of stocks open well below their
previous closes and a bear market is on.
SPX Forecast for August: http://screencast.com/t/W0Iw6aEv
THIS IS ALL SEEN ON A DAILY CHART
———————————
May 21st, 2015 high of 2134.28 to July 8th low of 2044.66 is LARGE Wave A down, which was 89.62 points in total.
It had 3 MEDIUM Waves inside it with it’s A down ending at 2072.14 on 6/9, then MEDIUM B up to 2129.87 on 6/22, and MEDIUM C down to end LARGE A down on 7/8 at 2044.66
Then we had LARGE Wave B up from 7/8 low to a 7/20 high of 2132.82, which was a 95.8% retracement back up or 88.16 points.
From the 7/20 high we started the LARGE Wave C down, and so far it’s breaking down into many smaller waves. We are currently still in the first MEDIUM Wave A down inside LARGE Wave C down.
Inside MEDIUM Wave A down we appear to have completed SMALL Wave A down from 2132.82 to the 2063.52 low on 7/27, then SMALL Wave B up from there into the 7/31 high of 2114.24, and now we are in SMALL Wave C down currently (from 7/31).
This SMALL Wave C appears to have broken down into 5 smaller waves. Wave 1 down went from 2114.24 on 7/31 to 2067.91 on 8/7. It had an ABC wave patten inside it as follows: Tiny A from 2114.24 to 2088.60, Tiny B back up to 2112.66, and then Tiny C down to 2067.91… ending Wave 1 down inside SMALL Wave C down.
Next we have the move up on Monday the 10th to make the Wave 2 up inside SMALL Wave C down, which was from 2067.91 to 2105.35, and thus putting us currently in Wave 3 down inside SMALL Wave C down today.
Since most all C waves and 3 waves are long and powerful they tend to divide into 5 wave patterns. That suggests yesterday’s high of 2105.35 to the suggested low this coming Thursday or Friday should have 5 wave inside it. I think we have done 1 down, 2 up (at the open today) and currently are in 3 down now.
If correct this leaves 4 up Wednesday and 5 down Thursday yet to come. The length of this wave down should be a ratio of it’s A wave down. Since SMALL Wave A down for this wave was from the 7/20 high of 2132.82 to the 2063.52 low that’s a total of 69.3 points.
Therefore, if SMALL Wave C down equals SMALL Wave A down in length then from the 2114.24 start of SMALL Wave C down we can subtract 69.3 points to come up with a downside target of 2044.94 as the coming low.
If SMALL Wave C equals 1.618% of SMALL Wave A down then we have 112.13 points down from 2114.24, or 2002.11 for the coming low this Thursday or Friday.
After this low is in we’ll complete SMALL Wave C down, as well as MEDIUM Wave A down, inside LARGE Wave C down. This means next week (the week of option expiration from 8/17-8/21 we should see MEDIUM Wave B up happen.
If MEDIUM Wave A down completes this week at the 2044.94 low then we have 89.34 points for it in total. Since MEDIUM Wave B up should be some Fibonacci percentage of the A wave we have the following possibilities…
MEDIUM Wave B up if 2044.94 low…
If 38.2% of MEDIUM Wave A down, then we should see 34.13 points up from the low of 2044.94, or 2079.07
If 50% of MEDIUM Wave A down, then we should see 44.67 points up to 2089.61
If 61.8% of MEDIUM Wave A down, then we should see 55.21 points up to 2100.15
MEDIUM Wave B up if 2002.11 low…
If 38.2% of MEDIUM Wave A down, then we should see 42.83 points up from the low of 2002.11, or 2044.94
If 50% of MEDIUM Wave A down, then we should see 56.06 points up to 2058.17
If 61.8% of MEDIUM Wave A down, then we should see 69.29 points up to 2071.40
FINALLY…
If all this happens then what should start the week of August 24th is MEDIUM Wave C down inside LARGE Wave C down, and that’s a whole new story my friends! Needless to say when you get many C waves stacked on top of each other you get a “FLASH CRASH”… caused by what you ask? Watch the movie Lucy, and look closely around 55 minutes into it. The rewatch The Matrix with the interview Neo had with an agent. False Flags are told to the insiders in advance.
SPX Update for this week: http://screencast.com/t/obXrek1O
Agreed… if we have a flat open I’d short it for sure. A gap up would be a gift.
VIX in the low 12. I will go long SnP when I see the VIX at 20
Last Friday’s forecast playing out today nicely: http://screencast.com/t/2Prf7DrPa
SBUX finally got whacked along with NKE, the two retail stocks that were probably holding up RTH while XRT diverged badly. Hotel stocks have been getting whacked as well…..HOT,WYN, MAR, HLT etc.
It looks like the celebrated Leo,Tebow, will be making the Eagles. All of this after spending a year out of football, helping launch the SEC network last year on his birthday.
We are in some serious South Sea Bubble cycle territory now. 295 years from the SS Bubble top. I don’t have the exact dates but the high occurred in August 1720, with denouement occurring in September. There was a great conjuction of planets on September 9,10. That could have launched the waterfall portion of denouement. Only the operators/ gnomes of Zurich have the exact dates.
We are also on the 25 year cycle to 1990 which saw a high in late July with a low in September. They might have delayed the 25 year cycle by three years to better align it with the 1990 pattern although it will probably take on a fiercer form. A lot of parallels to 1990 right now, a real estate bubble high/bursting….Japanese buying up US real estate/ trophy properties in New York…..Now a real estate bubble with the Chinese buying up US real estate/ trophy properties in New York…..real estate developers building luxury apartment buildings everywhere now and commanding “luxury level rents” even though many of the properties remain minimally occupied.
Transports peaked out the previous fall in 1989 while the market made an overall peak in July 1990. Transports/ utilities peaking in early 2015.