The closest thing I can think of for a fractal of the current market condition is the late 2016 correction prior to the elections. If you are really creative you can count 5 waves down in that decline too starting from Aug 2016 high. The current 5 wave decline is seen much more clear in the the RUT and NYA. In the SPX the market breaks EW rule of wave 2 retraces all of wave 1. I believe this is because of the overwhelming strength of tech of which SPX is a overweight in. Again for best count look at RUT, NYA or even some foreign markets. You will see a much more clear 5 wave decline starting from Jan of this year.
Now, because I think we will go down in 5 waves to complete the 5th wave. the 1st wave will drop to support level of 2700 area, then bounce then drop in a 3rd wave etc. In the SPX this entire structure will look like a double zigzag starting from Feb highs.
THere is no guarantee this is what will occur, but based on previous fractal in 2016 this is likely. Essentially the 5th wave becomes extended in time and takes the longest to occur with clear subwaves.
Now, because I think we will go down in 5 waves to complete the 5th wave. the 1st wave will drop to support level of 2700 area, then bounce then drop in a 3rd wave etc. In the SPX this entire structure will look like a double zigzag starting from Feb highs.
THere is no guarantee this is what will occur, but based on previous fractal in 2016 this is likely. Essentially the 5th wave becomes extended in time and takes the longest to occur with clear subwaves.
評論:
There is also the possibility we only retest the lows in 5 waves and do not go down to new lows. We will have to just wait and see.