Update: 1:10pm EST: Target zone hits have begun.
Current ES target zones have been clearly identified since 11/20 and continue to be valid based on pattern and vector progressions. VXX typically prints lower adjusted targets during a topping process as volatility dips into a final zone.
You may want to keep in mind the previous post on the longer term outlook.
See Critical Long-Term Review Here
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Our favorite go to site- McVerry Report
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ReplyDeleteCan you shed some light on my observation, if March bottom was A and current top is expanded flat B and I am looking for 1.236-1.1618 C retrace SPX: 1800-1300?
Varun- thank you for the comment. The calculation you posted could very well apply long-term but expectation at the moment is based on the behavior of volatility derivatives SVXY and also VXX which can provide very clear signaling when it comes to directional changes and overall momentum vectors as you might expect. As of now, we expect the top on this leg to still be under construction and a pullback likely may not take out the March lows but may be a medium-term correction prior to the more significant top appearing. As always- everything undergoes a reassessment in the live environment. The Elliott Wave patterns are something we indulge in only crudely so we apologize for lack of expertise in this area. Hope this helps. - Stuart
DeleteMakes sense. If I am reading your SVXY chart correctly, C wave down will have 70% correction in same time frame as it happen for A wave down in Feb/Mar? It will be interesting to see how much correction occurs in major indexes as tech stocks are already trading at very high valuations.
DeleteVarun- the visualization here can get tricky as we are most likely dealing with one very large (2018 drop) and one lower (early 2020 drop) degree pattern. We are waiting for the lower degree 'C' (or wave v) down in SVXY to begin and as you say, it will be interesting to see how far that will bring down the market. Drops in this environment have been fast but a vector pattern we are watching may be indicating a more 'staged' drop for this next leg. This drop may create a low enough hit in SVXY to slingshot it back up it to a new high above the current area that also takes the market to new all-highs. At this point, it is possible we may have entered the larger degree pattern and be in a 'flag' in anticipation of the major decline from there. This is very speculative based on historical behaviors and as outlandish as it seems, we have been very close with projections so far.
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