It took this morning’s ramp to 1431.62 to confirm this EW pattern. As of now, it is (nearly) finished, with a 67% retracement of Primary Wave [1]. Wave (A) consumed 64 hours. Wave (B) consumed 17 hours and Wave (C) consumed 26 hours, giving us a near-perfect fractal model for a corrective pattern.

Yesterday was the Model Pivot day, but the two hours of additional rally today does not endanger the potential panic fractal that is due next. While the panic fractal may be over in as little as three days, there is a stronger likelihood of the panic low coming in next Monday or Tuesday.

As of the last count, the number of December 22 put option contracts on the SPX has increased from 2,217,000 to 3,193,252. The January contracts have not appreciably changed, so it appears that the probability is stronger than ever that there may be a “take down” of the market in the next week. That’s right…this appears deliberate.

The Cycles Model says that we are now overdue for a significant cycle low.

Best wishes,

Tony

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As a State Registered Investment Advisor, The Practical Investor (TPI) manages private client investment portfolios using a proprietary investment strategy created by Chief Investment Officer Tony Cherniawski. Throughout 2000-01, when many investors felt the pain of double digit market losses, TPI successfully navigated the choppy investment waters, creating a profit for our private investment clients. With a focus on preserving assets and capitalizing on opportunities, TPI clients benefited greatly from the TPI strategies, allowing them to stay on track with their life goals

Disclaimer: The content in this article is written for educational and informational purposes only. There is no offer or recommendation to buy or sell any security and no information contained here should be interpreted or construed as investment advice. Do you own due diligence as the information in this article is the opinion of Anthony M. Cherniawski and subject to change without notice.

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