SPX Cycle Top - End of an Era?
Stock-Markets / Stock Markets 2014 May 24, 2014 - 01:12 PM GMT
SPX is up against its Cycle Top resistance and appears to have completed its retracement. It may be time for a Dynamic Sell Signal. The current high of 1899.05 is still short of the May 13 high of 1902.17. The pattern does not support a further rally.
The VIX has several ways to account for the declining pattern. The chart pattern I have used makes the most sense.
ZeroHedge has made no further comments so far.
The weekly chart of the VIX gives us a further perspective on the pattern. The only stick in the mud is that Primary Wave [5] is not lower than Primary Wave [3] at 11.05. Final waves of very long patterns are known to truncate, so the low of 11.45 may be sufficient to make this bottom in the VIX.
There are several comments that may be made about this chart. The first is that it has been bumping against the upper trendline of its Orthodox Broadening Top since December 31. This compares with the SPX Orthodox Broadening Top trendline which was overtaken at 1600.00. The Dow formation may confirm that the SPX Broadening Top is still valid.
The second is that its seems to have made several rallies lasting 5.16 years. This is the third of a series. The current 5.16 years was projected to end on May 7, 2014. The final high in the Dow was May 13, only 6 days later.
It did not make a new high today and is clearly retracing the first decline from its May 13 high.
Regards,
Tony
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