20 Year SPX Bear Market
Updated
After looking over and fine-tuning my analysis for SPX over the past few months, I think I've calibrated things as good as they will get for now (barring any new, major [price action based] developments which would force me to re-adjust my wave count). SPX has been on a tear from 1877 to 2022 for a very large Grand Supercycle (a 5 wave move lasting more than 100 years).
Though timely corrections were seen during the Great Depression (1929-39 roughly) and during the 9-11/Iraqi War timeframe (early 2000s), to name a few, the Bulls have always responded and claimed higher highs afterwards. Giving SPX traders the feeling that it will never ever come down.
However, the injection of the COVID era seems to have forced the SPX into a much different and more dramatic phase potentially. Though a new all-time high was seen after the introduction of COVID-19, the lingering nature of this disease and its effect on global economies will continue take a toll on the US Stock Market as it seems.. Surely, I'm no Doctor but I think SPX has a case of Long COVID to put it more plainly.
Beyond the fractal by fractal wave counting, I've also heavily considered fibonacci levels plus RSI readings. Things to note:
1) Wave 5 [usually] terminates between +1.38 or +1.618, compared to the size of Wave 4. Currently the hypothetical Wave 5 sits at more than +2(00%) the size of Wave 4, technically making it extended.
2) The Elliott Wave science suggests that RSI has the lowest peak in Wave 1, the highest peak in Wave 3 and an obvious divergence in the peak of Wave 5's divergence. Looking at the circled areas of SPX's RSI window, all of these guidelines seem to ring tru. Its clear to see that the RSI peaked in Wave 3, its also clear to see that although Wave 5 made a higher-high in price action - the RSI level terminated at a lower level compared to Wave 3, its also clear to see that the RSI in Wave 1 was the lowest of the three-trending-waves (1,3 and 5; Waves 2 and 4 are corrections against the trend).
As for price levels, its my belief that if SPX cannot reclaim and hold support above 4000=4600 in the next few years to come then the pending pump (which should initiate in the days/weeks ahead) will only serve as a correction/relief rally/retracement. WIthout 4000-4600 turning into support (in the next few years), I have reason to believe that the Bear Markets is even more likely (see outline below).
Though timely corrections were seen during the Great Depression (1929-39 roughly) and during the 9-11/Iraqi War timeframe (early 2000s), to name a few, the Bulls have always responded and claimed higher highs afterwards. Giving SPX traders the feeling that it will never ever come down.
However, the injection of the COVID era seems to have forced the SPX into a much different and more dramatic phase potentially. Though a new all-time high was seen after the introduction of COVID-19, the lingering nature of this disease and its effect on global economies will continue take a toll on the US Stock Market as it seems.. Surely, I'm no Doctor but I think SPX has a case of Long COVID to put it more plainly.
Beyond the fractal by fractal wave counting, I've also heavily considered fibonacci levels plus RSI readings. Things to note:
1) Wave 5 [usually] terminates between +1.38 or +1.618, compared to the size of Wave 4. Currently the hypothetical Wave 5 sits at more than +2(00%) the size of Wave 4, technically making it extended.
2) The Elliott Wave science suggests that RSI has the lowest peak in Wave 1, the highest peak in Wave 3 and an obvious divergence in the peak of Wave 5's divergence. Looking at the circled areas of SPX's RSI window, all of these guidelines seem to ring tru. Its clear to see that the RSI peaked in Wave 3, its also clear to see that although Wave 5 made a higher-high in price action - the RSI level terminated at a lower level compared to Wave 3, its also clear to see that the RSI in Wave 1 was the lowest of the three-trending-waves (1,3 and 5; Waves 2 and 4 are corrections against the trend).
As for price levels, its my belief that if SPX cannot reclaim and hold support above 4000=4600 in the next few years to come then the pending pump (which should initiate in the days/weeks ahead) will only serve as a correction/relief rally/retracement. WIthout 4000-4600 turning into support (in the next few years), I have reason to believe that the Bear Markets is even more likely (see outline below).
Note
With an apparent diagonal in Wave 1, the retracement in Wave 2 is due to test the yellowish-green box based on fib levels. This will be the pivotal test for SPX in my opinion. If Bulls cannot reclaim support above 4000-4600 and sustain it, expect the SPX/mainstream stock market to bleed.Note
Also, in regards to the main/primary image of this prediction, the yellowish-green box is placed between 0.50-0.618% the size of Wave 1 (equaling 50-61.8% in retracement). These are two of the most common levels for a Wave 2 retracement. It is also possible that Wave 2 (Grand Supercycle) finds support near the previous/sub wave 4 (of Grand Supercycle 1) but considering the fib level where this resides, I think SPX will be due for a much deeper dive. Time will tell.Note
This week on SPX:I am expecting a drop below 3492 before price action begins its next wave back up near 3800.
Note
SPX looks for another downside move soon before making its big upward test of the 4K range.Note
SPX prepares to test the lows of $3000-$3100. The best test to follow will seal SPX's fate for the next number of years.Note
Its taken some time to re-analyze the wave count and make sure everything aligns with the Elliott Wave framework, but -- I have discovered more accurate micro wave analysis (I believe).The huge macro drop is still in queue, however I think buyers will send it near 5500 before the drop initiates.
Over the next year roughly, we should see SPX ping-pong pretty hard. If so, this is a tale-tell sign that an ending diagonal is in place.
Note
It is worth pointing out this long-lasting and undefeated trend line. Also notice that the RSI peaks in Wave 3 and despite new seeing highs (points) in Wave 5, divergence is sustainably observed throughout its entire period. These are signals to that increase confidence in wave counting.HODL
Join me on the waves, where its safe. discord.gg/QRPx6ShxMt
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