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Thursday, January 14, 2021

Elliott Wave Update ~ 14 January 2021


I believe we may be almost upon the greatest stock market crash the world has ever seen.  If this is an expanded flat as shown below, it is very close to peaking as it has "expanded" above the previous February 2020 high by quite a bit already and is "due" for wave (C) of [A]. Wave (C) should consist of 5 Minor waves down. A rough landing zone creating the "right look" is Wilshire 15,000, or roughly the previous peaks of 2000 and 2007.  Sometime in 2022 would make sense for the low as according to Robert Prechter of Elliott Wave International (click my links to left!), a 20 year cycle low is due in 2022. It is late getting started to the downside so it'll have to start soon and, may be very harsh.

And the same count from the INDU perspective shows that a new high formed from a small triangle.
The weekly shows the other way to label this: as the final wave of a 233 Grand Supercycle rise.  But we must assume social mood is "peaking". It certainly is not, and from a social mood context, the "false" (B) wave "irregular" top certainly fits. However, both counts are correct in a sense and both imply 5 waves down to come regardless.

And yes, I would say on the weekly we finally reached the upper channel line again. Look at the volume spike! Its trying to tell us something!
Everything is accounted for is all I am saying. Top? 
Again, from a squiggle point of view, there are enough waves in place to consider the count complete. (and it just may be). (also adjusted some front end squiggles for a better count and look)
Top variation is that a very sharp downturn is in store but it will bounce off the base channel as shown below and have one final rally to form [v] of 5. Call this the Biden/Harris honeymoon period.

I'm a bit burned out on social mood commentary today. Everything I wanted to say about social mood I have been saying for the past many nights.

One small point that I haven't been talking about much is a collapse would be massively deflationary. Everything has been "on hold" and that won't last forever. Sooner or later the loan losses from unpaid mortgages both commercial and residential are going to stack up and get noticed.  And all the other loans and obligations that have been "on hold". 

Everything we have done over the last year since March has been deflationary. People losing their jobs is deflationary. Major sports leagues losing fans and money is deflationary.  Big Tech cancelling 1/2 the country is certainly deflationary.  Closing restaurants, businesses, limiting travel, cancelling tourism are all deflationary. I could go on and on.

Yet the stock market seemed to "ignore" the deflation (for now).  The market is gaslighting us all. That is why I strongly feel it is likely a (B) wave false peak and on the verge of total collapse.

The wave counts and social mood suggest that outcome is a very strong possibility.

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