A major market correction expected
Updated
Russell 2000 index has been moving up in a sequence of five Elliott waves since 2009. This progress is coming to an end in a few months.
It has completed four of the five major waves on a monthly time frame (dark blue). The fifth wave that has been in progress since 2016 has already completed four of the five waves. It is currently going up in the fifth wave.
Interestingly, if you check the weekly chart below, the fifth wave is also nearing completion. It has completed four sub-waves (green) and is currently in the fifth sub-wave!
If you zoom in further and go to the daily time frame, the fifth sub-wave is currently in the second micro wave (turquoise). After the completion of the correction, this wave is going to extend to around 1800 level and then start the correction (see below).
The correction is expected to take Russell down to around 1300 levels (red waves).
Weekly chart
Daily chart
It has completed four of the five major waves on a monthly time frame (dark blue). The fifth wave that has been in progress since 2016 has already completed four of the five waves. It is currently going up in the fifth wave.
Interestingly, if you check the weekly chart below, the fifth wave is also nearing completion. It has completed four sub-waves (green) and is currently in the fifth sub-wave!
If you zoom in further and go to the daily time frame, the fifth sub-wave is currently in the second micro wave (turquoise). After the completion of the correction, this wave is going to extend to around 1800 level and then start the correction (see below).
The correction is expected to take Russell down to around 1300 levels (red waves).
Weekly chart
Daily chart
Note
Update:RUT is moving down in wave 2 as expected (see the daily chart above and the chart below). This correction is likely to complete between 1645-1660 after which RUT is expected start wave 3 taking it up to 1760-1770.
Note
RUT appears to be in a smaller fourth wave currently. I am expecting another fourth wave in a week or so as shown below. My target hasn't changed though I have modified the wave pattern a bit.Of course, it is not a trading advice.
Note
Smaller fourth wave appears to be complete. RUT is likely to move up in the smaller fifth wave before going down in another fourth wave (turquoise).This analysis is just for educational purposes and is not a recommendation to buy or sell. Please do your own research and trade at your own risk.
Trade closed: target reached
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