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Thursday, June 25, 2020

Elliott Wave Update ~ 25 June 2020 [UPDATE 7:30PM]

[UPDATE 7:30PM]  I'm really trying this VIX theory of ONE five wave nested count from VIX surge peak back to VIX pivot low for significant corrections. As pointed out yesterday, it helped us to find Intermediate (2), and it helped us to find Minute [ii]. Now we can see if it helps us find ii - or (ii) if you prefer.

My rules for counting the VIX are generally these: 1) Nothing is generally "truncated". Start the count and end the count wherever it is.  2)  The VIX is surging to a new spot, then settling back down in a 5 wave move - then surging to a higher spot after the 5 wave move is over.  3) Generally I think you can count each settlement back to a low in its own context.   4) The new low settlement spot shouldn't be lower than the previous count low (for a bear market wave such as the one I am proposing we have started down in).  5) Don't include after-hours VIX other than to anticipate how it will open.

Again, my theory is that we get agitated and fearful and we don't "correct" this agitation and fearfulness back down in 3 waves we impulse it down in a nested 5 wave move. The great thing is the VIX counts almost always starts prior to prices actually hitting their lows. Our max fear is somewhere in a market wave 3 down.

But all the same, our overall state of agitation is getting steadily higher. Strike prices get further and further out on both sides of the bet. We are less certain. Everyone is all over the map with their emotions.  The once homogenous, calm steady state is no longer calm.  Once a surge is momentarily peaked, we strive to impulse back to a calmer state.

The wave degree labels don't really mean anything. I just used whatever to convey the meaning. I tried to keep it relatively tied-in to the market count so you get the idea.

Using the VIX count, may help us predict the market count.

Even though I showed the "MAX mega gap up" count below as a possible alt, the mega gap up probably wouldn't fit into my VIX theory count below unless I am labeling things too early.  But who knows.

Lets just see if a few ups and downs finish it off nicely.  I just developed this theory so it's still being tested. Tomorrow is a big test. This is one chart to count intraday.
Another Wilshire count.  Fun with trendlines.
Primary count is that wave ii of (i) of [iii] down is retracing back up. Once its done, a strong wave iii of (i) of [iii] down should commence.
There could be enough retrace to consider wave ii over but this is not an easy market.
However, the bulls managed to hold the bottom channel line as shown on the chart(s) above. And it snuck prices just over the resistance line at end of day. I just knew that would happen!

Therefore here is the top variation of the bearish count, well, just because. I tried to think of the most surprising move for everyone (bulls and bears alike) and here is what  I came up with. 

This is the scenario where the market has a mega-mega-gap up  that once it opens it keeps driving and not only covers the open gap from yesterday but covers the open gap from the mega "kickoff" wave down from 2 weeks ago.

But no worries mate! At the end, it all falls apart in an about face downwards. Fake breakout!
This would give us the second strike on the down trendline. I cannot believe that won't be tested.  This would produce repeating fractals at differing scales. And both wave two retraces would be deep. And both retraces will have taken a lot of time versus the wave ones down.
Would likely gap right up through the previous distribution zone not allowing any dip buyers at all!
LOL cruel market! First you mercilessly eat all their stops, now you make 'em dip back in at much higher prices!
Another possible wedge forming on the Composite if it surges again.  Price target is posted.  This would have to happen within a day or so. 10,264.
Apple would probably count better also.
I'll post more down here later. I'm gonna look like an idiot if futures do opposite.

And here is the Minor wave 4 count. It also would take  some significant price gain to form a final triangle in an [w]-[x]-[y] formation.
Or if you prefer a simple contracting triangle. Wave [a] was a very bearish wave though.  "Kickoff" for wave (3) down. Usually wave [a] of a triangle coming from peak does not produce a 33-1 down stock ratio and 90% down day all-around.   Wave [e] is starting from a deep spot also in this chart.  Its not a favorable count for this and other reasons.

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