As mentioned earlier, SPX wasn’t finished with its final extension. It now appears to be done. It has exceeded all Wave relationship calculations, from the smallest degree to the largest.

This may be a very dangerous place for the longs, but even the shorts will have difficulty taking a position. We have seen a 2.5% rally in 56 hours, just 4 hours short of 8.6 days.

I wonder who will start the selling. The first probable date for a low appears to be 8.6 market days away, should the reversal turn into a panic.

I have no market signals, other than the conviction that this may be the top. I will attempt to relay the signals to you as they happen, but there may be a delay. Use your best judgement should you desire to take action sooner.

The VIX made what appears to be its final plunge in an Ending Diagonal formation. I was wrong in saying that there might not be a new low today. Right now Wave [v] of C is 75% the size of Wave [i] and 68/% the size of Wave [iii]. At 9.32, it was 61.8% the size of Wave [iii].

Oh well. You can’t achieve perfection in this market.

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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