Elliot Wave Analysis suggest that 90% chance of what we are experiencing today is still a Bull Market with the ff. analysis:
With few headwinds coming due to Negative Divergence of MACD and RSI of the Weekly Charts of SPX. A fast rally to new highs should make MACD and RSI strong.
<1. (30%) – too bullish scenario –
a. we are currently in the Primary Wave V end of Bull market, and is in the minor wave 3 of Intermediate Wave 3, we expect to reach new high (1400-1440) and then small pullback then finish off to new highs to finish minor wave 5 of Intermediate Wave 3,then a sizable amount of pullback for Intermediate Wave 4, then finalizing the Bull Market with the last final bang.
b. This count abide some of the Elliot Wave rules namely: Primary Wave III is the shortest, Primary Wave IV went below Primary Wave I. and this is just a model scenario of what may happen.
2. (60%) – typical bull market and is extending
a. 2011 deep correction was just Primary Wave II, and we are currently in Primary Wave III, and waves are subdivided into small waves. Taking a look into smaller waves, we are in the Intermediate wave iii and a few more rally and make new 52week high before intermediate wave iv correction could happen (5-10%),then a rally to close the intermediate wave v (Primary Wave III), after that,expect the biggest pullback that can amount to 11-20%, like Primary Wave II 2011 correction, then a final blow to end the Bull market by finishing Primary Wave V.
b. Targets to finish intermediate wave iii is at 13700-14000, other targets will be depended on the wave structures,will post more soon.
3. (10%) – Bear Market Correction
a. This scenario is unlikely to happen, but can still be the case. If we closed soon this month and sold off by 10% or more, this scenario can happen.
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