Market Update

Avi Gilburt

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Can The Market Manage One More High Before Year-End? Thu Dec 14th 2017

The market traded lower today, heading down to test support that should tell us if another high in this pattern is still possible, or if odds will now shift in favor of a top already in place. For another high to remain a reasonable probability, price should hold between here and 2651 ES as a 4th wave within the larger 5th off last week's low. Assuming support does hold, then wave 5 of v can target the next fib above at 2682.75 ES before putting in a top.

Are We Done Yet? Wed Dec 13th 2017

Yes, I can actually ask that question now on the IWM.  With today’s rally, we have the minimum number of waves not just for a top of (3) to be in place, but even for a (b) wave to have completed.  In fact, if we break below today’s low, it would be our first bearish indication we have seen in the IWM in quite some time.  And, once we break below the early December low, it would have me focusing on a return to the mid-November lows for the a-wave of wave (4).

It’s A Race To The Finish Tue Dec 12th 2017

With the IWM seriously lagging at this time, whereas the SPX and NQ are around their all-time highs, it makes me strongly consider whether the IWM has indeed topped at its last highs.  For this reason, I have added the (b) wave count in yellow. To put this (b) wave potential into perspective, I would still want to see one more rally take hold in the IWM, which may coincide with the final move higher in the NQ.  Once we strike the 153+ region, then we can move support up to the 152 region.

Steady As She Goes Mon Dec 11th 2017

With the NQ surging today, it is certainly approaching the target box we have for the 5th wave rally we wanted to see before we can consider the market as having topped.  The question now is whether the IWM can also see a double top, or higher high.  Based upon the micro set up, if we can see the IWM gap up and rally tomorrow, it can make a statement that it is within wave (iii) of its 5th wave.  But even if it does, it is only pointing to a marginally higher high.

Taking A Step Back Thu Dec 7th 2017

As I noted earlier today, I think this is a good time to take a step back, and look at the forest, as we have been focusing on the leaves quite a bit of late. Back in early to mid-November, I had strongly reiterated that I cannot consider that the equity market has topped until we see a completed 5th wave up in the IWM.  And, so, with the pullback just below the 145 region in the IWM, I went long for a trade, while looking towards the 152-156 region.

Is It Time For Another Rally? Wed Dec 6th 2017

With the market continuing its downside consolidation today, the IWM has now gotten closer to the point where the c-wave would be equal to the a-wave if this wave iv is the correct count.  This means that anyone who is interesting in taking a low risk long trade, you are relatively close to your stop out point at 148.75. To be honest, I don’t think I can provide better guidance than what is being represented on the 60-minute IWM chart I have been presenting to you of late.

Another BTD Opportunity? Tue Dec 5th 2017

Today, the market certainly provided us further weakness after striking the highs yesterday morning.  But, as I have noted, as long as we remain over Friday’s low, the bulls are still very much in charge. This brings me to the IWM chart.  While we certainly have enough waves in place to consider that 5 waves up off the mid-November low as completed, and we struck the target region when we did it, until we break Friday’s low, I am entertaining one more bullish potential.

The Pattern Is Full Mon Dec 4th 2017

Before I begin this update, I want to be clear and remind everyone that this is still a bull market and it will likely last several more years, and likely take the SPX over 3000.  So, every decision you make with your portfolio should always keep that in mind. With that being said, we have been patiently awaiting the IWM to complete 5 waves up off its mid-November low.  And, with today’s gap up, we now have what we can consider a full 5 waves up.

SPX Played Catch Up Today Thu Nov 30th 2017

Yesterday afternoon, I closed my analysis with the following: So, we will need a bit more patience, as the market may still attempt to extend a bit more before we begin wave (4).  While we certainly can count enough waves in place if the market chooses to break down sooner rather than later, I think patience is going to be the key right now, as we allow the market to signal to us that it has exhausted itself to the upside . . .

Topping Is A Process Wed Nov 29th 2017

This morning, I sent out an update that suggested you maintain an eye toward the bigger perspective as to where we believe we stand in the market.  And, yes, we are looking for the final “squiggles” in this rally off the August lows, which should also complete a major segment of the rally off the February 2016 lows.  But, there is an old saying that “topping is a process.”   And, often it is a frustrating process.   Yet, consider why people view it as such.