Markets rise, most stocks don't. The Weekly bar has engulfed all the bars the past 14 weeks. This should paint a picture of how bullish this week was. On a Monthly scale the top BB line is at 2169 and if signals are looking to diverge, I would say that this is the perfect time to make a new high beating out last years May High. Nothing in the Monthly chart suggests a reversal down with price bars ending positive the last 4 consecutive months, and signals at OB, Diverging (Only if price makes a new ATH). A conundrum for the Bears for sure. The best view on EW here would be that the SPX cash chart is producing a last ditch effort for a 5th wave of some kind of a subwave 3. What this means is that there will be a "correction". There also should be another move to a "Newer ATH". Sounds surprising with all these economic and geopolitical woes doesn't it? I can't explain it, but it's what the patterns are telling me could happen. The only way I can explain the markets going up is if the equity markets are being used as safe havens from gov't or possible currency instability.
Either way, there will be a lot of people who will not see this coming. If we count the year 2010 lows around SPX 1000 and count 2169 SPX as the high for a complete wave-3 (green). Then the Fib. results we get are:
38.2% at 1718 SPX range
50% at 1580 SPX range (
ALSO THE LAST TWO TOPS 2000 & 2007)
61.8% at 1445 range
These are the levels I would watch for a wave-4 to end before making a trek to ATH. Possibly to 2646 SPX as the last and final leg of a wave-5 (Green) which is also 100% of wave-1 (green).
Note: Notice the 2 Moving Averages that I watch which is also converging with the range given by the Fib. levels of Wave 2-3 (Green).
SEN: Bullish
ST: UP
PA: UP
R: NA
Don't hold your breath for a crash yet as price, signals, patterns are all looking bullish. There are no clues as of this moment to suggest a reversal will take place. That said, it does not also mean it can't happen. Watch the indicators...
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