Start getting prepared for a decades-long “winter.” It’s going to get a lot worse before it gets better. Who’s next? It’s going to be a wild ride over the next few years. Insurance companies are getting quite scared, as there’s a lot of fraud out there, not to mention Houston, Florida, and Equifax. We’ve had many retail bankruptcies recently and this foreshadows a much greater problem. They’re mostly government subsidized (certainly in Musk’s case) so it’s only a matter of time before it all falls to dust. I expect Elon Musk to crash and burn: After all, none of these electric cars have sold in great quantities. Toys “R” Us looks like it’s finally going down for the final count.
Amazon just set themselves up for a gigantic short by over-leveraging and buy out Whole Foods. We have a lot of financial “cracks” developing. In any event, that takes a lot of money out of the market. Of course, a lot more are “out.” It’s amazing how many hedge funds have folded as they simply haven’t been able to make any money (and are unsure of where the market is going). Volume is light, which means that almost everyone is “in” on the long side and smugly enjoying their profits, believing this market is going to continue on for a whole lot longer. Nobody’s seen a 500 year top, so we don’t have a lot to go on. There could be quite a bit of volatility at the top.
We’re seeing some volatility in terms of large swings in currencies, gold, and oil particularly. We’re starting to get close to a major market top. _ A Word of Caution (the Coles notes version)
Going forward in time, a line connecting the ends of waves 2 and 4 converges with a line connecting the ends of waves 1 and 3.Wave 4 always ends within the price territory of wave 1.Wave 4 never moves beyond the start of wave 3.Wave 3 always goes beyond the end of wave 1.Wave 2 never goes beyond the start of wave 1.Waves 1, 2,3, 4 and 5 of an ending diagonal always subdivide into zigzags.An ending diagonal always appears as wave 5 of an impulse or wave C of a zigzag or flat.A diagonal triangle always subdivides into five waves.Rules (these are “hard” rules they cannot be broken): The sub-waves will be in three waves (zigzags), which makes analysis difficult, volume gets lower as the ending diagonal traces out, and the final wave will likely complete a throw-over (exceeds the upper trendline in a bull market). So, you don’t actually know you’re in one until the fourth wave of the ending diagonal is in place. The biggest is that all the waves are in threes and the upper and lower boundaries don’t get defined until the 3th wave (upper in a bull market) and 4th waves (lower). Ending DiagonalsĮnding diagonals are notoriously difficult to trade.
Jupiter hell diagonal movement full#
This would mean that the C wave down is up next and it should trace out in 5 waves to the downside.įollowing is a full description of the larger ending diagonal, more than half-way to completion in NQ/NDX/SPX/ES. This is a 3-3-5 configuration, the two three-wavers now complete. That more than suggests a top is in place for the third wave of the ending diagonal.įrom the top so far, we appear to be setting up a flat to the downside. We had three ending diagonals in a row-a triple three of ending diagonals (an historic first, as far as I can make out) on a 10 minute chart of the SP500. It’s becoming more probable a top is in place, from an Elliott Wave perspective, with all these ending diagonals showing up. We have them unfolding in both ES and NQ (emini-futures) as well as their cash counterparts. They’re considered relatively rare, but in this market, they’re certainly not. We have a few more weeks left in this market and then the bear market begins in earnest.Įnding diagonals are appearing all over the place. You can even look at the DAX and see the same phenomenon taking shape. With the potential top in place in oil, all assets with any relationship to the reserve currency are now moving towards a final top. Gradually over the past year or so (since I first mentioned it), the USD currency pairs, the US dollar, the US indices, bonds, and gold have become more and more closely aligned.