It now appears that SPX has broken its 3-week Ending Diagonal formation. The minimum retrace is 100%. There are only 3 waves evident here, so the move is as yet incomplete. The most likely immediate target is either the Broadening Wedge trendline at 1692.00 or short-term support at 1688.12.

An interesting alternative may be a close at the lows today and a gap down through all supports at the open on Monday.

This seems to be a good start of the decline.

The VIX made a triple zigzag decline into its Intermediate Wave (2) low. The total decline was a Fibonacci 88.5% retracement. Fortunately, the cycle was a short 46 days from the prior Master Cycle low. This makes it right-translated and Bullish.

GLD is wasting no time resuming its bearish trend. The wave structure is still developing, but this gives us an approximation of where we may be. It appears that this decline may also take GLD to the end of October (25-31).

TLT is embarking on its final and largest decline of the season. It, also, is due for a low in late October or early November.

You may be getting the idea there is no place to hide in all the traditional places, and you may be correct.

Regards,

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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