If we get the down open Monday and then recovery, the best pattern is that wave [b] of 2 is a running ascending triangle. Prices for (e) of [b] would have to finish lower than the peak of [a]. Otherwise, it’s not a running triangle.
The market has been range bound for a month at the 3575 – 3800 range. The head fake beneath the range formed Minor 1. A proposed head fake above the range should form Minor 2. At the moment the market is frustrating the maximum amount of people both bull and bear alike.
Bonds. Hammered. I keep placing a wave [1] but it keeps just going lower and yields higher. The Ponzi has popped, and no one realizes just yet.
3 and 6 months still shooting upwards. Solid 3/4-point raise is coming, but if these 2 rates rise another 1/5 point and hold above that, we are looking at a full 1-point rate raise by the Fed come the next meeting in early November.
Today the signs of “heavy” trading picked up again. At one point the NYSE was trading at over a 5:1 down ratio in decliners vs. advancers even though the price drop seemed “tame” compared to what has been happening. The SPX closed under 3700.
Perhaps a backtest of the upper channel line occurs tomorrow maybe a gap down. Who knows, they have been pushing futures every which way of late to get the extreme openings.
The thin blue box is the “virgin” space of the 5-wave structure from (2) to 1. This is the Minor 2 minimal target range and it’s at the 38.2% retrace Fib which would be an acceptable wave 2 level.
If prices bust downward we have last support at about 3578 SPX.
GLOBAL WAR COMMENTARY
I am predicting that after this week’s Chinese Communist Party meeting, Babylon USA will go back to provoking Xi with high-level visits to Taiwan again.
Perhaps even V.P. Kamala Harris will surprise visit within 2 weeks. That’ll really rile ’em up. We had #3 in the Presidential line visit, why not #2?
Again, the best weather window for attacking across strait is October/November in my estimation.
If China does a full-on invasion and Taiwan fights back, the USA will find themselves shooting down Chinese jets before Thanksgiving. And then the global war goes “hot”. Just remember, the globalists trying to bring about the New World Order want and need these wars. Global financial collapse is coming. Satan is in charge of it all.
The Wilshire 5000 has corrupted data again on Stockcharts. I had to add to the top of today’s candle.
The market has now bounced higher than at any other time since the wave (2) peak of August. Prices have broken out of the down channel, and the wave pattern so far from the low is a 3-wave pattern. All these things collectively signal that we are on the correct count of Minor 2 of Intermediate (3) down.
The following charts show ideal Elliott Wave relationships within the context of a series of (1)-(2), 1 – 2, [i] – [ii]. In an ideal EW pattern as the wave hierarchy gets smaller, the speed of the market should speed up and volatility steepen. So far that has been the case. We can estimate Minor 2’s target range. Intermediate (2) did not retrace 61.8, perhaps Minor 2 only makes it to 50% or even less.
Once the market rolls over Minor 2, this is when things should really fall apart. Eventually the market should panic break at the ideal “third of a third” wave panic point. Sometimes time speeds up also. So even though this chart shows ideal pathing, it’s just a best-case scenario.
Too early to tell what is going on with the pattern since the low, but so far it charts best as a double zigzag. That could be just wave [w] of a complex [w]-[x]-[y] corrective pattern, or in theory, it could be all of Minor 2 itself. However it seems a bit short in price and time so we assume not just yet.
Or we could have a Minor 2 pattern going on like this below and we are only seeing the very few first days of many.
The DJIA has been more stubborn in giving up prices since the January peak and more persistent in its retraces. The positive RSI divergence has already been fulfilled with prices soaring over Minute [iv] of 1 of (3) whereas the other indices are lagging in that regard.
NYSE. Today’s advance/decline ratio was only 2.5 to 1.
If the Fed were to raise rates today, it would be a 3/4-point raise. There are signs that the rise is slowing as the spread between the 3 and 6 month its narrowing.
What people don’t understand is that the Fed cannot lower rates with the 3- and 6-month short term rates at their present levels. It is the market that drives rates, not the Fed. And people will counter that the Fed controls the 3- and 6-month yields that is not true.
At any rate, the Fed funds has always stayed within market range or else there would be extreme distortions. Imagine if the Fed cut rates tonight by 1%. to a target window of 2 – 2.5%. With the 3- and 6-month rates being double that, what kind of distortions do you think that would create in the way the Primary Dealers handle the overnight paper markets and other short term market making funding schemes (of which there are too many to count)?
The Fed would lose money is the bottom line. And as much as people like to think the Fed serves “we the people” they are a private bank first and foremost.
So, the Fed follows the market, so they do not lose money. it’s that simple. Rates go up, they must follow. Rates go down, they must follow. This is the same way all Central Banks operate more or less. In Europe, real rates went negative, and the ECB decided to follow along and set a negative funding rate which was probably a mistake which presents tremendous duration risk.
The real rates in the U.S. also went negative, but the Fed set the floor at 0% as to avoid overly long-term complications of which the ECB is starting to experience. But alas, it won’t matter.
It’s all a Ponzi, make no mistake. Once debt/GDP ratio – which can be debated what the true number is – becomes greater than 100%, bankruptcy is sure to follow. We are 32 trillion in debt, and I think the GDP is more or less the same (and one could also argue that number is fudged beyond measure). It doesn’t take much of a GDP decline in combination of soaring interest rates to break the bank. This is where we are at.
That which cannot go on forever – won’t.
It is like a household that earns $100,000 and has $100,000 in credit card debt that is of course subject to prime + bankster robbery. A loss of income or lesser paying job will break that household very easily. An interest rate of 9% going to 14% and loss of income to now only $65,000 means it’s game over. And the interest compounds until one must declare bankruptcy which of course wipes out the debt and effects the banks that “funded” it. It’s a cascading situation. And interest (usury) is evil and ungodly and of course its run mostly by adherents to Judaism or Jewish offshoot Freemasons. Both groups are doing the work of the Satan to bring about the New World Order. Complete financial “reset” is part of that plan.
There will be no “Fed pivot” because it is all a lie, and they have setup the masses to think otherwise. 30 years of “market conditioning” will do that to you. But the rug is being pulled out all the same.
They just don’t want to be blamed too much. But they are to blame all the way since 1913 and the creation of the Fed monster to begin with.
The primary count is that Minor 2 of Intermediate (3) is playing out. This could take some time. Minor 1 of (3) took about 41 trading days. Therefore Minor 2 could take some time for instance 21 trading days would be an example.
However, the important thing is that Minor 2 has the right “look”. An [a]-[b]-[c] pattern of some sort. Part of the right look is having the right price (and time).
The blue box is the target box. It looks about right and I do expect prices to go above Minute [iv] peak of Minor 1 down. Another touch of the 50 DMA perhap.
The market is trading very “heavy”. An outright crash is predicted based on the Elliott Wave count. How close or far away from that exact moment is why we count intraday squiggles, but the overall outlook points toward collapse.
We are only trying to guess the timing.
Lowered expectations for Minor 2. If it is Minor 2 that is…
It’s amazing the “psychology” of the bear market so far. No one has yet to say, “the market has crashed”. Yet the Composite already shows a 62% retracement from the peak versus the 2020 low.
And a 38% drop from intraday peak. And yet the pundits would be correct. The market has yet to truly “panic”. Maybe it won’t because that is what everyone is waiting for. Perhaps we just keep grinding lower and lower.
The RSI is not oversold. Is that bullish? Or is that a sign that the market has plenty room to fall. I contend the latter of course. How we get there is a matter of squiggles.
The market finally finished lower in about the manner I was hoping for to form a very decent Minor 1 of Intermediate (3) wave low.
Additionally, The DJIA, the NYSE also made lower lows finally and both confirmed 5 wave moves from the Intermediate wave (2) peak we have been referencing for many weeks.
And zooming in on Minute [v] of 1 we get the squiggle count which works quite well.
The Wilshire daily, which is a twin sister of the SPX practically, shows the daily Minor wave 2 target range. The double positive divergence remained of course so we might expect prices to move above Minute [iv] price peak as a follow-through of that technical divergence.
Please note how today’s candle – which is labeled Minor 1 of (3) low – looks identical to the candle of the Minor 1 of (1) low back on February 24th, the day of the Ukrainian/Russian war start.
DJIA made a lower low which confirms 5 waves from (2)
NYSE the same. Very satisfying wave structures and all indices seem to be in agreement…which is bearish for the overall longer-term count even if we get a sharp Minor 2 of (3) bounce.
[UPDATE: This is the chart that was shown a week ago complete with dashed-red trendline pointing to the likely Minor 1 low. I’m not sure why I did away with that over the last several days.]
The best 2 counts are still the same as yesterday. Either Minor 1 finished a few days ago at the intraday low, or it has a bit more to go. I prefer it finish lower, but either way, the structure is solid.
The Dailys are showing double positive divergence still. If a hard rally bounce Minor 2 plays out starting tomorrow, expect prices to go a bit above the previous Minute [iv] peak of Minor 1 of (3) down to form a healthy Minor 2 of (3).
The DJIA has been diverging from the other indices. It too would look better to make a lower low so that we have a solid 5 waves down from (2).
Perhaps a comparison of where the primary wave count seems to be in 2022 as compared to the 2008 5-wave impulse down.
It would indeed look better if Minor 1 of (3) ended even lower. That would make today’s low wave (i) of [v] of 1 of (3) down.
If it was Minor 1 down today, then we have reason for a Minor 2 bounce.
NASDAQ Composite. Retreated some Fibonacci 61.8% of the entire rise from March 2020. And in about half the time it took to get up there.
COMMENTARY ON UKRAINE ESCALATION
The more the Russians attack infrastructure within Ukraine, the more the likelihood of some kind of infrastructure retaliation inside Russia itself. I think this is what Team Babylon USA-NATO ultimately want. They have desired wanton destruction in Ukraine so that we are more apt to escalate and get directly involved. A reason to provide Ukraine with the most advanced long-range missiles capable of damaging targets within Russia itself. Or a reason to enact a no-fly zone.
The West wants Russia to commit itself full-scale in its war with Ukraine. To commit even more military to advance within the country. For when this happens, NATO could get involved and with much of Russia’s conventional military on the move toward Kiev (again), the trap will be sprung. A half squadron of A-10’s would have made mincemeat out of any 40-mile-long convoy as was earlier in the campaign.
This makes sense as the West will not stop until Russia is subdued as a threat to Team Babylon New World Order. Putin himself may actually be in on the global conspiracy to create a one world government as I have suggested numerous times before as he is a card-carrying WEF member. Regardless, Satan has put it in his heart to wage war and even more war, for what purpose we can only guess.
But it is clear most of NATO is itching for a fight with Russia. This can only happen if Russia keeps indiscriminately attacking Ukraine and creating a “humanitarian crisis”. After all, winter is coming and tens of millions without power, water, heating, etc. will give the rest of the world a reason to get involved. Putin has taken the bait once again.
THE WAVE COUNTS
Both the SPX and Wilshire 5000 have confirmed with today’s new 2022 intraday low that 5 waves have occurred since the wave (2) peak. This would form Minor 1 of (3) down. We can then expect a bound for Minor 2, and then the markets would be setup for a major crash in 3 of (3) down.
I hate to be nitpicky, but I’m a bit disappointed Minor 1 is not much lower in price. Perhaps today’s low was only subwave (i) of [v] of 1 of (3) down. regardless, it’s a wonderful Elliott Wave structure.
