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Monday, May 18, 2020

Elliott Wave Update ~ 18 May 2020

Well, there was the kick in the nuts I mentioned in my late update on Friday!

New recovery highs in the SPX and Wilshire5000 but not the DJIA or NYSE.

Primary count. Also note at the bottom the divergence on the VIX, it did not make a new recovery low.
Best guess is that today's peak was (iii) of [c].
If there are a few squiggles or so left in the count, the 200 DMA is 30,473 - would be a nice place for wave (2) to strike. Note: the 200DMA on the SPX is 2998 right near a very excitable target of S&P 3000. That would garner the public's attention. It made it intraday to 2968.

7 waves up on the daily = corrective = bearish.
The 50 week Moving Average is 30,523. 
Top alternates for wave (2) would be the next 2 charts. The market would collapse to [e] in glorious fashion. I don't like this count but I included it because my 2nd alternate sucks even worse and I'll discuss that next.
The count below supposes that today was a the "kickoff" of Minor wave C of Intermediate (2). Elliott Wave International is using 1 higher wave degree than I am and would have this as the kickoff to an Intermediate wave (C) of Primary [2].  In either case, this implies that (2) or [2] has a long way to go. 

If you look at the count below, we just had 5 weeks of "A" and 2 weeks of "B". How long is "C" now supposed to last?

Also what price ratio would C take in relationship to A?  Wave B didn't even retrace 30% of the entire rise of A.  That's an awful shallow B wave. 

So I will stick with my primary count of triple zigzag for now and suppose that even though the market threw us a last minute curveball, wave (2) is over or nearly so with a squiggle or two left to go.

[Update 5:45EST - I screwed the chart up below and had it in log scale so I changed it. For my C extension calculations I should have used non-log scale. It is now corrected.]
NYSE because I wanted to show the internals today also that its didn't make a new recovery high. Was a very robust internal day but the overnight mega-gap up will help things like that. It ended the day at 6.88:1 and 7.95:1. 
And finally I found 2 headlines on Marketwatch that show how exuberant everyone can be again.
And then later this one:

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